In Brief

EU ‘Fit for 55’ Climate policies need a rethink

Source – clustercollaboration.eu

In July, the EU announced a dozen legislative proposals to ensure its climate and energy laws cut greenhouse gas emissions by 55% by the end of this decade. These measures have been called the ‘Fit for 55’ package because they would put the bloc on track to meet its 2030 goal of reducing emissions by 55% from 1990 levels.

EU member states will face tougher greenhouse gas reduction targets and increased demands to produce renewable energy. The EU as a whole will aim to get 40% of its energy from renewable sources by the end of the decade.  It will also lead to the end of the internal combustion engine by 2035

The scale of this plan is astonishing. It will impact on almost every European citizen in all aspects of their lives. To give some perspective, from 1990 to 2019 the EU cut carbon emissions by 24%. However, it now proposes to slash CO2 by another 31% in just 9 years. If net-zero target is to be achieved by 2050—that is what must be done.

Although the “Fit for 55” measures will undergo a two year process to gain approval by member states and the European parliament, they are certainly the  EU’s most ambitious plan yet to tackle climate change.

EU policymakers must also balance climate change reforms with the concerns of developing and poorer European countries who wish to protect their economies from rises in the cost of living.

The challenge posed by the ‘Fit for 55’ initiative is that it ignores the real impacts on vulnerable communities in developing countries. The EU must consider that there are other economic blocks that need to transition to sustainable systems also if global sustainability targets are to be met. Brussels must work together in partnership with other countries to ensure that all sides are working together for common climate goals.

This was clearly the point made by  Dan Tehan, Australian Minister for Trade, Tourism and Investment,  who argued that the EU Carbon Border Adjustment Mechanism (CBAM) was designed to raise revenue rather than reduce emissions.  He even called out Brussels for breaching  global trade rules by instituting a carbon tax that was effectively a ‘new form of protectionism’.  

The point Australia is making is that the EU cannot unilaterally embark on climate change proposals, which affect the rules of global trade, without addressing the potential implications for other trade-dependent countries. Trade is indispensable for the future stability of developing nations.  These new EU climate proposals do not consider the role of trade in levelling the playing field and allowing less developed countries to lift themselves out of poverty – a crucial step to fund the systemic change needed to fight climate change.

If global warming is to be averted, every nation must measure the environmental impact of its policies and take steps to minimize carbon emissions.

The world has witnessed how COVID-19 disrupted global trade and created challenges for vulnerable economies. The EU should be looking for ways to assist developing countries to promote sustainable production models. If less developed countries face severe trade barriers entering the EU market, they would have no choice but to look elsewhere—that all too often means countries with less strict environmental regulations.

The EU’s steps to effectively ban palm oil for biodiesel in 2019, ostensibly to combat deforestation and encourage sustainability, was not well thought through. That ban led to more inefficient use of land with a turn to alternative crops like rapeseed and soybeans that are grown in Europe as a source of oil for biofuel. Unfortunately these crops require much more land to generate the same amount of oil as palm plantations, and they store less CO2 than palm oil. Rapeseed, for example produces four to 10 times less oil than palm oil per unit of land and requires more fertilizer and pesticides.

Meanwhile, major palm oil producers increased their exports to China (the second-largest importer and third-largest consumer of palm oil in the world), where questionable market practices remain.  That EU tactic led to more unchecked and unaccountable carbon emissions, not less palm oil.

Opportunities to work with major palm oil producers should be the first step, not a distant afterthought. There are already good examples in countries like Malaysia, one of the world’s leading producers of palm oil, to tackle deforestation and make palm oil sustainable.

Malaysia has done so by establishing its own  national certification scheme, Malaysian Sustainable Palm Oil (MSPO) which is nationally regulated and legally binding. MSPO includes robust regulations protecting the environment and wildlife. In fact, around 90 percent of Malaysian palm oil is currently MSPO certified. The EU has yet to acknowledge the country’s success in reducing deforestation rates since 2017.

The battle against climate change is a global imperative best solved through cooperation and collaboration. The EU should capitalise on the successful efforts of countries like Malaysia and work to develop better policies.

The EU cannot continue to exclude developing countries from the climate debate because civilization cannot afford hindering efforts to combat the most severe crisis our world is facing.