What is the European Green Deal?

CLIMATE ACTIVISTS, policymakers and delegates from European cities are gathering (virtually) for the European Union’s Green Week, an annual talking-shop. This year’s event is dedicated to finding ways to stop pollution of the air, water and soil (past themes have included how to implement environmental laws and make cities climate friendly). This objective aligns with another adopted by the EU as part of the European Green Deal. The deal emerged from the European Commission (the EU’s executive arm) in December 2019. It is the bloc’s most ambitious attempt to date to counter climate change and environmental degradation. All 27 member states—except smoggy Poland—back it. What does the deal actually entail?

The European Green Deal is a slim, 24-page document with an enormous scope and a dearth of detail. The main objective is for the EU to eliminate or offset its greenhouse gas emissions (ie achieve “net zero emissions”) by 2050, in line with global efforts to limit global warming to 1.5-2°C above pre-industrial averages. Underpinning that are a host of interconnected goals covering almost every element of society and the economy. These include decoupling economic growth and resource consumption by moving to a “circular” economy that increases recycling and reduces waste; preventing biodiversity loss and deforestation; overhauling agriculture and electrifying transport.

The deal itself is not a piece of legislation but a set of agreed objectives. Achieving them will require sweeping new rules. The most important of these is a European climate law which enshrines the 2050 net-zero emissions goal, the details of which were agreed by European politicians in April 2021, including an interim requirement for member states to cut their emissions by “at least” 55% from 1990 levels by 2030. It is part of a wave of green regulation working its way through Brussels’ bureaucracy.

The European Green Deal also demands masses of cash. The investment plan that supports it proposed €1trn ($1.2trn) of investment across ten years. Of that, roughly half is meant to come from Europe’s emissions-trading scheme and the EU budget. Within the budget, much of the promised funding seems to have been conjured up by relabelling money that would have been spent anyway, for example on infrastructure and agriculture. The rest relies on mobilising unprecedented amounts of private investment. The commission itself has previously estimated that the bloc will need €260bn a year to reach its climate and energy targets by 2030. Even if such sums are raised, member states will struggle to agree on how they should be spent. Those in the north and west want to focus on investing in technology such as batteries and power grids; poorer southern and eastern states fret over how to support their economies through the transition. Poland has already declared itself exempt from the 2050 goal.

Surprisingly, the covid-19 pandemic may go some way to overcoming these disagreements. Countries hoping for a cut of the €672.5bn-worth of grants and loans in the bloc’s recovery fund will have to spend it on Brussels-approved plans, with 37% earmarked for climate-friendly spending and all subject to a “do no harm” principle which should, in theory, stop the money being used for projects that work against climate objectives. The need for cash might bring even the most recalcitrant countries in line. Extraordinary times may yet prove the making of the Green Deal.

Editor’s note (6th June 2021): This piece has been updated since it was published.