On 4 March 2020 the Commission published its draft Climate Law, formally a Regulation to establish the framework for achieving climate neutrality. This legislation had been flagged in incoming Commission President von der Leyen’s Political Guidelines published prior to the ratification of her nomination by the European Parliament.
It was confirmed in the Commission’s Communication on the European Green Deal in December 2019 with the stated aims to set out clearly the conditions for an effective and fair transition, to provide predictability for investors, and to ensure that the transition is irreversible. It would also ensure that all EU policies contribute to the climate neutrality objective and that all sectors play their part.
The draft legislation came in for scorching criticism from the Swedish climate activist, Greta Thunberg, on the same day that it was published. Ms Thunberg had been invited by the European Parliament’s Environment Committee to speak at a committee meeting open to all MEPs. On the following day, she repeated her criticisms at a meeting of the Environment Council of Ministers.
Greta Thunberg’s main point was that the remaining carbon budget available to the globe for future emissions if the world is to have a significant (66%) chance of holding the global temperature increase below 1.5° as estimated by the IPCC is so limited that only much more ambitious action than proposed in the Climate Law will keep us within this budget.
“Your distant targets will mean nothing if high emissions continue like today, even for just a few more years, because that will use up our remaining carbon budget before we even have the chance to deliver on your 2030 or 2050 goals,” Ms Thunberg said.
In this post, I describe the provisions of the draft Climate Law and what their implications are likely to be. I also highlight those areas where improvements could be made. The discussion is in two parts. First is the issue of targets, both for 2050 and 2030, and whether these are sufficiently ambitious. The second part examines the powers that are granted to the Commission under the proposed legislation and whether these are adequate. This is a long read, and the conclusions at the end summarise the main points of the analysis for those who prefer a shorter summary.
Are the 2050 and 2030 targets sufficient?
The date to achieve net-zero emissions
Article 2 of the proposed Climate Law sets out:
Union-wide emissions and removals of greenhouse gases regulated in Union law shall be balanced at the latest by 2050, thus reducing emissions to net zero by that date.
It also makes achieving this goal the collective responsibility of the Union and the Member States, binding both to take the necessary measures to enable the collective achievement of the climate-neutrality objective, taking into account the importance of promoting fairness and solidarity among Member States. Thus, the goal of climate-neutrality by 2050 at the Union level does not necessarily imply that every Member State must or should reach this goal by that date.
The EU submitted its long-term low greenhouse gas emission development strategy to the UNFCCC on 5 March 2020 endorsing the objective of achieving a climate-neutral EU by 2050.
The Climate Law proposal justifies the 2050 date for climate-neutrality as follows:
The Intergovernmental Panel on Climate Change (IPCC) Special Report on the impacts of global warming of 1.5°C above pre-industrial levels and related global greenhouse gas emission pathways confirms that the impacts of climate change increase rapidly with increasing global mean temperature, and indicates that already at 2°C the world would see dramatic impacts due to climate change. It estimates that in order to be on a pathway to limit temperature increase to 1.5°C, net-zero CO2 emissions at global level needs to be achieved around 2050 and neutrality for all other greenhouse gases somewhat later in the century. This urgent challenge calls for the EU to step up its action to show global leadership by becoming climate neutral by 2050, covering all sectors of the economy and compensating, by 2050, not only any remaining CO2 but also any other remaining greenhouse gas emissions, as set out in the Communication A Clean Planet for all – A European strategic long term vision for a prosperous, modern, competitive and climate neutral economy and as confirmed by the ‘European Green Deal’ Communication. Both the European Parliament and the European Council have endorsed the long-term EU climate neutrality objective.
Advocates of greater ambition argue that the date for the net-zero goal should be brought forward to 2040 and that the 2030 goal should be correspondingly increased to 65-70%. Without question, the earlier we can reduce emissions, the better. However, in that case, why not demand that the net-zero target be brought forward to 2030?
This is because there is a trade-off between the extent of disruption we can expect from delaying the date of climate stabilisation and the extent of disruption involved in reaching that target. This is a complex trade-off, because the costs involved in both cases are uncertain and the decision involves weighting the welfare of future as against current generations, and the welfare of people living in our own jurisdiction and in other parts of the world. But it is a trade-off, and trade-offs involve value judgements that science alone cannot adjudicate.
Last November, the UN Environment Programme (UNEP) in its Emissions Gap Report 2019 published just before the COP25 conference in Madrid estimated that global emissions must fall by 7.6% per annum over the coming decade (from 2020 to 2030) to have a 66% chance of limiting the global temperature increase to 1.5°. This would translate to a 70% emissions reduction target for the EU by 2030 compared to 1990 (considering that EU emissions are 23% below 1990 levels in 2020). This ignores any global equity arguments that the EU should take responsibility for a greater share of the global emissions reduction than its current share of those emissions.
The UNEP report calculates that global emissions would have to fall by 2.7% per annum between 2020 and 2030 to have a 66% chance of limiting the increase in global temperature to less than 2°. An EU reduction target of 55% by 2030 compared to 1990 would be consistent with this rate of decline, again ignoring global equity considerations. On the other hand, the EU has been reducing its emissions since 1990 while the rest of the world has been increasing its emissions. The EU also has an interest in showing the rest of the world that the transition to a net-zero economy can take place with manageable costs. While the voices calling for more ambitious action must continue to make their arguments, my sense of the trade-offs at this point in time is that the net-zero goal by 2050 is an appropriate EU target.
The issue of timing around setting the 2030 target
Articles 2(3) and 2(4) set out how the Commission proposes to review the EU’s 2030 reduction target of 40% compared to 1990 levels which was set in the European Council conclusions of October 2014 and included in the EU’s Intended Nationally Determined Contribution submitted to the UNFCCC in 2015. The EU is required to submit its updated Nationally Determined Contribution (NDC) in 2020 and, in line with the Paris Agreement’s goal of gradually ratcheting up commitments, is expected to substantially raise its level of climate ambition in this submission.
The Commission’s Communication on the European Green Deal had previously announced that by summer 2020 the Commission will present an impact assessed plan to increase the EU’s greenhouse gas emission (GHG) reductions target for 2030 to at least 50% and towards 55% compared with 1990 levels in a responsible way. To deliver these additional greenhouse gas emissions reductions, the Commission would, by June 2021, review and propose to revise where necessary, all relevant climate-related policy instruments (these comprise the Emissions Trading Scheme (ETS), Member State targets for sectors outside the ETS, and the Land Use, Land Use Change and Forestry (LULUCF) Regulation). The Commission proposed to amend the Climate Law and update it accordingly.
The Commission’s approach in the draft Climate Law is set out in Recital (17):
By September 2020, the Commission should, based on a comprehensive impact assessment and taking into account its analysis of the integrated national energy and climate plans submitted to the Commission in accordance with Regulation (EU) 2018/1999 of the European Parliament and of the Council, review the Union’s 2030 target for climate and explore options for a new 2030 target of 50 to 55% emission reductions compared with 1990 levels. Where it considers necessary to amend the Union’s 2030 target, it should make proposals to the European Parliament and to the Council to amend this Regulation as appropriate. In addition, the Commission should, by 30 June 2021, assess how the Union legislation implementing that target would need to be amended in order to achieve emission reductions of 50 to 55% compared to 1990.
This higher level of ambition by 2030 was supported by the European Parliament in its resolution of 28 November 2019 in advance of the Madrid COP25 meeting. It supported an update of the EU’s NDC with an economy-wide target of a 55% reduction in domestic GHG emissions by 2030 compared to 1990 levels and called on EU leaders to support an increase in the level of ambition of the EU’s NDC. Importantly, on the issue of timing, the Parliament believed that these updated reduction targets should be included already in the European Climate Law when it is first passed.
Twelve Member States that are members of the Green Growth Group, an informal grouping of like-minded energy, climate and environment Ministers, signed a letter on 28 February (just prior to the launch of the Commission’s Climate Law proposal) also asking for the setting of 2030 targets to be brought forward to June rather than September which is closer to the date originally proposed in the European Green Deal Communication.
Part of the Group’s motivation are the opportunities for the EU to show international climate leadership later in 2020 particularly with the EU-China Leaders’ Summit in September (where there is an ambition that the EU jointly with China in the absence of the US could push the climate agenda forward) and the COP26 in Glasgow in November. The concern is that unless the EU puts forward its more ambitious targets well before these events its ability to influence other parties will be greatly reduced.
There is a clear clash of tempos here. On the one hand are those who emphasise the urgency of increasing the pace of emissions reduction whose necessity is underlined by the recent IPCC reports. For this group, the need to increase the EU’s 2030 targets to ensure that the EU moves on to a trajectory leading to a climate-neutral economy by 2050 is so self-evident that waiting for an impact assessment is seen as an unnecessary delaying tactic. On the other side is the lumbering, rule-based decision-making process of the EU which needs to bring along 27 Member States (and recall that even at maximum strength the Green Growth Group only numbers 15 Member States).
A Commission proposal in September will leave little time for the Council and Parliament to debate it if the EU wants to submit its updated NDC prior to COP26 in Glasgow on 9-19 November 2020. While it could be submitted before the end of the year, it would be a major diplomatic failure on the part of the EU which sees itself as a climate leader to go to Glasgow without having first submitted its own updated NDC. Thus trying to agree on more ambitious 2030 targets before the summer would be highly desirable.
But somehow I think this is unlikely. Not only is the impact assessment, if it is to be a helpful analysis, a major undertaking that will require time, but also the Commission’s attention (as well as the resources available) will be diverted by its attempts to deal with the public health and economic consequences of the coronavirus outbreak in the coming months. There is thus a very small window of opportunity in the second half of this year for the EU to get this right.
Setting targets is one thing, implementing the measures to achieve them is the harder bit. Here the Commission will propose legislative changes to its climate-related policy instruments by June 2021. While bringing forward the date when new 2030 targets will be proposed to the early summer would be important if the EU is to exercise international climate leadership in the coming months, bringing forward this second date should be an even greater priority as every year lost in this decade before action is taken makes reaching the 2050 goal of a climate-neutral economy more difficult.
What new powers for the Commission?
Setting targets and trajectory using delegated acts
An important power is given to the Commission in Article 3 of the proposed Climate Law “Trajectory for achieving climate neutrality” where it would be empowered to adopt delegated acts to supplement this Regulation by setting out a trajectory at Union level to achieve over time the 2050 objective, starting from the agreed 2030 target. This implies that the Commission should decide on the specific EU-wide reduction targets for the years between 2030 and 2050.
Nonetheless, there is some ambiguity around what is meant by the phrase “setting out a trajectory at Union level”. Nowhere are the elements of this trajectory defined. Thus it is not clear whether this also includes establishing the division of the reduction target between the ETS and non-ETS sectors, or the extent of credits that can be earned by the LULUCF sector, or even national reduction targets in the non-ETS sector (see discussion in next section).
It is proposed that this would be done every five years, aligned with the Paris Agreement timelines. Under the Paris Agreement, Parties periodically take stock of the implementation of the Agreement and assess collective progress towards achieving its purpose and long-term goals, in the ‘global stocktake’. At the latest within six months of each global stocktake, the Commission will review the trajectory.
What will be controversial here is the proposal that the legislature will delegate the power to the Commission to set these reduction targets in delegated acts. Delegated acts are a non-legislative procedure foreseen in Article 290 of the Treaty on the Functioning of the European Union to supplement or amend certain non-essential elements of a legislative act. The Commission drafts the delegated act in consultation with Member State experts as well as experts from the Council and the Parliament – no formal opinion of any committee is needed. Under the Better Regulation agenda, citizens and other stakeholders can also provide feedback on the draft text of a delegated act during a four-week period.
The delegated act is then forwarded to the Council and the Parliament under a negative assent procedure. If no objection is received from either the Council or the Parliament within the period specified in the basic act (in this case, two months with the possibility to extend this period for a further two months, Article 9), the delegated act becomes law. The right to object to a delegated act on any grounds is a strong legislative safeguard although it is also a nuclear option – the act cannot be amended but only rejected, although the Commission can be requested to submit another delegated act that takes account of the objections from either the Council or Parliament. The empowerment of the Commission to propose a delegated act can also be revoked at any time.
The key point is that it requires a qualified majority in the Council and/or an absolute majority of the Parliament’s members to block approval of a delegated act, thus increasing its chance of passage. There has also been criticism of delegated acts that they give too much weight to technical expertise (the expert committee that the Commission must consult) at the expense of democratic oversight (Robert, 2018).
If the legislation is intended only to set EU-wide targets this might not be an issue as all legislation designed to ensure that the EU is on the proposed trajectory will need to go through the full legislative process in any case (e.g. amendments to the ETS, Effort Sharing Regulation, LULUCF Regulation, etc). Given the list of elements (see next section) that the Commission is required to consider when establishing and updating the trajectory one would in any case expect the delegated act to be based on a published impact assessment, although there is no requirement for this in the proposed Climate Law.
Criteria to be invoked when setting the trajectory
Article 3 sets out a list of criteria that the Commission should consider when setting the future trajectory. The list is as follows:
(a) cost-effectiveness and economic efficiency;
(b) competitiveness of the Union’s economy;
(c) best available technology;
(d) energy efficiency, energy affordability and security of supply;
(e) fairness and solidarity between and within Member States;
(f) the need to ensure environmental effectiveness and progression over time;
(g) investment needs and opportunities;
(h) the need to ensure a just and socially fair transition;
(i) international developments and efforts undertaken to achieve the long-term objectives of the Paris Agreement and the ultimate objective of the United Nations Framework Convention on Climate Change;
(j) the best available and most recent scientific evidence, including the latest reports of the IPCC.
It can be argued that these are all factors that any responsible government would take into account in setting reduction targets. But they have drawn criticism on the grounds that the role of scientific evidence is relegated to the bottom of the list rather than sitting at the top, and that requiring the Commission to take into account numerous factors such as cost-effectiveness, economic efficiency and economic competitiveness leaves too many escape routes for both for Member States and the Commission to “ignore the alarm bells that science has consistently been ringing”.
It is noticeable that fairness and solidarity is mentioned only in the context of between and within Member States, thus leaving the wider climate justice arguments about equity and burden-sharing across Paris Agreement signatories (including responsibility for historical emissions) out of the picture.
It is also the requirement to consider fairness between Member States when setting the Union trajectory that seems to leave open the door to more than just EU-wide reduction targets being set in these delegated acts. This door is pushed even further open by the powers given to the Commission to assess the consistency of national measures with the trajectory towards the climate-neutrality objective. Without specifying what Member States are required to do under this trajectory such an assessment would lack any objective foundation. This underlines the importance of clarifying in the legislation what the term ‘trajectory’ covers.
Keeping track of progress
Articles 5, 6 and 7 set out a process of review of both Union progress and Union and national measures with respect to both mitigation and adaptation and a process in case of insufficient progress or inconsistencies. These processes are summarised in Recital (18) in the draft Climate Law.
To ensure the Union and the Member States remain on track to achieve the climate-neutrality objective and progress on adaptation, the Commission should regularly assess progress. Should the collective progress made by Member States towards the achievement of the climate-neutrality objective or on adaptation be insufficient or Union measures inconsistent with the climate-neutrality objective or inadequate to enhance adaptive capacity, strengthen resilience or reduce vulnerability, the Commission should take the necessary measures in accordance with the Treaties. The Commission should also regularly assess relevant national measures, and issue recommendations where it finds that a Member State’s measures are inconsistent with the climate-neutrality objective or inadequate to enhance adaptive capacity, strengthen resilience and reduce vulnerability to climate change.
Review of Union progress
The review process of Union progress and Union and national measures would build on existing reporting and monitoring requirements set out in the Governance Regulation for the 2030 Climate and Energy Framework (Regulation (EU) 2018/1999). This Regulation (Article 29(5)) already requires the Commission annually to assess whether the Union and its Member States have made sufficient progress towards meeting their UNFCCC and Paris Agreement commitments, their legal obligations under the Effort Sharing and LULUCF Regulations, and the objectives set out in their integrated national energy and climate plans for the first ten-year period with a view to fulfilling the 2030 targets for energy and climate.
The main effect of the Climate Law is to prolong this reporting and monitoring process beyond 2030 to assess progress towards achievement of the climate-neutrality objective as expressed by the agreed trajectory. However, such assessment would be limited to five-yearly periods beginning by 30 September 2023. This is intended to align with the first global stock-take under the Paris Agreement scheduled for end-2023.
The assessment will also cover the consistency of Union measures with the climate-neutrality objective. Where these are inconsistent or insufficient the Commission will propose new measures at the same time as the review of the trajectory carried out under Article 3.
Monitoring of national measures
The proposed law would also give the Commission the power to issue recommendations to states acting in a manner inconsistent with the 2050 objective on the same five-yearly schedule. Once again, this process of review of national measures and recommendations would be on top of those already legislated for in the Governance Regulation for the period up to 2030.
Under this Regulation the Commission, on an annual basis, assesses whether a Member State is on track to reach its targets set out in the ESR and LULUCF Regulation and its integrated national energy and climate plans. The Commission shall issue recommendations to a Member State if policy developments in that Member State show “inconsistencies” with its objectives, taking into account the latest country-specific recommendations issued in the context of the European Semester.
The obligation of the Member State is to take due account of the recommendation “in a spirit of solidarity between Member States and the Union and between Member States”. It must set out in its integrated national energy and climate progress report made in the year following the year the recommendation was issued, how it has taken due account of the recommendation. If the Member State concerned decides not to address a recommendation or a substantial part thereof, that Member State shall provide its reasoning (Article 34 of the Governance Regulation). Essentially the same wording is carried over to the new Climate Law.
The Commission comments as follows in its explanatory memorandum to the Climate Law:
The aspect of Commission recommendations to Member States as set out by the proposed Regulation is complementary to the recommendations issued in the context of the European Semester. While the European Semester focuses on macro-economic and structural reform issues which also encompasses climate issues this initiative addresses specific policy developments inconsistent with the climate neutrality objective or trajectory towards climate neutrality.
Climate proofing
Recital (16) of the proposed Regulation notes that “The European Council, in its Conclusions of 12 December 2019, stated that all relevant Union legislation and policies need to be consistent with, and contribute to, the fulfilment of the climate-neutrality objective while respecting a level playing field, and invited the Commission to examine whether this requires an adjustment of the existing rules.” As part of Article 5, the Commission has proposed a “do no harm” clause so new initiatives will have to be compatible with climate neutrality.
The Commission shall assess any draft measure or legislative proposal in light of the climate-neutrality objective … and include this analysis in any impact assessment accompanying these measures or proposals, and make the result of that assessment public at the time of adoption.
This is a welcome attempt to introduce climate-proofing into consideration of new EU legislation. The weakness is that it is the Commission itself which is both judge and jury of whether new legislation it proposes is consistent with the climate-neutrality objective. One needs only to look at how the Commission has proposed to measure climate mainstreaming in the EU budget to realise that this is a pretty ineffective safeguard.
If the Commission wants to take climate-proofing seriously, then it should set up the equivalent of an independent Climate Council that now exists in many Member States as well as in third countries such as New Zealand to hold national governments to account in their climate policy. This would be different to the Climate Committee set up under Article 44 of the Governance Regulation which is a comitology committee of Member State representatives and which assists the Commission in drafting non-legislative acts. An independent Climate Council should be given the power to review the Commission’s assessments of progress, to make recommendations on additional measures that might be necessary, and to conduct climate-proofing of proposed legislation.
Adaptation to climate change
Finally, we should note that the Climate Law addresses adaptation as well as mitigation in Article 4. Recital (14) recalls that :
Adaptation is a key component of the long-term global response to climate change. Therefore, Member States and the Union should enhance their adaptive capacity, strengthen resilience and reduce vulnerability to climate change, as provided for in Article 7 of the Paris Agreement, as well as maximise the co-benefits with other environmental policies and legislation. Member States should adopt comprehensive national adaptation strategies and plans.
Article 4 is a short article that states that the Union and Member States “shall ensure continuous progress in enhancing adaptive capacity, strengthening resilience and reducing vulnerability to climate change in accordance with Article 7 of the Paris Agreement.” The sole obligation in the Article is a requirement for Member States to “develop and implement adaptation strategies and plans that include comprehensive risk management frameworks, based on robust climate and vulnerability baselines and progress assessments”.
This is already an obligation of Member States under Article 19 of the Governance Regulation which requires Member States, by March 2021 and every two years thereafter, to report to the Commission information on their national climate change adaptation plans and strategies. The Climate Law does not appear to introduce any new obligations under this heading.
Conclusions
The Commission’s Climate Law proposal is, in many ways, anticlimactic. It reiterates matters that have already been decided, such as the climate-neutrality target for 2050. It empowers the Commission to review progress and the consistency of Union and Member State measures with the agreed trajectory to meet this target, powers it already has under the Governance Regulation. It requires Member States to develop adaptation plans, an obligation Member States already have under the Governance Regulation. It binds the Commission to undertake an impact assessment on increasing the ambition of the 2030 reduction target and to forward legislative proposals by certain dates, but one might ask why the Commission needs a law to tell it what to do when it has the power to do these things of its own accord.
The one procedural change of significance in the draft Law is the proposal that the Commission can establish the future trajectory to meet the climate-neutrality target by 2050 through delegated acts which are adopted under a negative assent procedure. As setting future reduction targets (for 2035, 2040 and 2045) only has significance to the extent that these are reflected in revisions in the EU’s climate-related policy instruments (the ETS, the ESR and the LULUCF Regulation) which must be agreed by the ordinary legislative procedure, the practical significance of this change may not be very significant.
The Climate Law itself must now be approved through the ordinary legislative procedure. Despite my assessment that it is a rather light piece of legislation, it does provide the opportunity for a structured debate on some key aspects of EU climate policy. The following will be the central points of contention:
- The target of achieving a climate-neutral Europe by 2050 was adopted by the European Council at its meeting in December 2019, although Poland could not commit to implement this objective as far as it was concerned and the Council intends to return to the issue at its June 2020 meeting. The European Parliament, in its resolution of 14 March 2019 responding to the publication of the Commission’s Clean Planet for All document which examined various pathways to reductions of 80%, 90% and net zero emissions by 2050, underlined that the Union needs to strive towards reaching net-zero GHG emissions as early as possible and by 2050 at the latest. It regretted the fact that no net-zero GHG pathways for before 2050 were considered in that analysis. There will be an attempt to strengthen the level of ambition by bringing forward the net-zero target date although my own view at this point in time is that 2050 remains an appropriate target date.
- All are agreed that the EU’s 2030 targets need revising upwards so that they can be communicated to the UNFCCC when the EU submits its revised Nationally Determined Contribution later this year. The Commission has proposed to “explore options for a new 2030 target of 50 to 55% emission reductions compared to 1990”. This will be based on a comprehensive impact assessment and taking into account its analysis of the integrated national energy and climate plans submitted to the Commission (at the time of writing several of these national plans are still outstanding including big hitters such as France, Germany and Spain, even though they were due by the end of 2019 – the latest scoreboard of submissions can be found on this DG ENER website). Thus the debate on the level of ambition for the 2030 target will take place once the impact assessment is published, though there could be an attempt to require that the Commission examines an even greater level of ambition than reductions of 50-55%. The immediate debate will be around timing, where the Climate Law proposes that the impact assessment would be completed by September this year. For the Parliament and some Member States, this would be too late to allow the EU to effectively engage in international climate diplomacy in the run-up to COP26 in Glasgow.
- The draft Climate Law would allow the Commission to set out a trajectory at Union level to achieve the climate-neutrality objective using delegated acts. What is covered by the term ‘trajectory’ needs clearer definition, including whether or not it covers decisions on splitting the target across the ETS, non-ETS and LULUCF sectors and between Member States. There may also be an attempt to require the Commission to give greater weight to the best available and most recent scientific evidence when deciding on the trajectory, thus limiting the ‘wiggle room’ opened by the possibility to take economic concerns into account. The Parliament especially is traditionally opposed to giving the Commission too much power by way of delegated acts and may well baulk at this proposal.
- The draft Climate Law sets out specific timelines for the Commission to undertake assessments of Union progress and the consistency of Union and Member State measures with the trajectory decided. It also requires that the Commission assess all draft legislation in light of the climate-neutrality objective (climate-proofing). Here the weakness is that the Commission is both judge and jury of its own efforts which precedents do not suggest is satisfactory. An amendment to set up an independent Climate Council to hold the Commission to account as is best practice in many national climate laws would help to strengthen this important oversight function.
One final comment. The proposed Climate Law shifts climate stabilisation targets from simply political commitments to legal obligations or at least aspirations. It would take a legal scholar to assess whether this will make it more likely or not that court actions might be used to bring pressure on governments that are failing in their commitments, as we have seen successfully used in some countries (for example, the Urgenda Foundation case against the government of the Netherlands).
This post was written by Alan Matthews.
Photo credit: andreas160578 (pixabay.com) from needpix.com under CC licence.
