EU backs climate change measures

FOCUS ON FUNDING THOSE AT RISK

Subject extremely sensitive as inflation is on the rise.

European Union (EU) countries battled through the night to hash out the bloc’s new measures to fight climate change, with negotiations focused on a social climate fund for those most vulnerable in the green transition.

Late on Tuesday, environment ministers from the EU’s 27 member states adopted a common position on achieving zero emission new cars by 2035 and on a special fund to help firms and consumers cover the cost of their climate efforts.

But the proposal for the social climate fund (SCF) – a key component of the plan presented by the European Commission in July 2021 – was the subject of tense debate late into the night.

Establishing the special budget would help offset the impact of price increases for the bloc’s most vulnerable households and would also go towards housing and road transport measures that would reduce costs.

The subject is extremely sensitive for governments as inflation – linked to energy prices – is on the rise.

With divisions still deep, the 27 member states agreed on the plan in principle but remained at odds on the size of the fund. Initially the fund aimed to provide over €72 billion (about R1.2 trillion) in EU funding from 2025 to 2032.

But richer countries – like the Netherlands and Germany – want a smaller fund, with the spending targeted towards innovation, while Eastern European countries are pushing for a bigger budget to help cover the cost of going green.

Berlin had initially proposed the allocation of €20 billion – the smallest possible portion – but finally on Tuesday raised it to €48 billion.

France, which holds the rotating presidency of the EU, rallied the majority of states to the amount of €59 billion for a shorter period (2027-2032), calling it a “fairly balanced compromise”.

The agreement did not convince Poland, which denounced “decisions that risk undermining popular support for the climate plan”, while Latvia voiced concerns about a fund “unable to meet the challenges faced”.

Other issues, including a revamp of the EU’s Emissions Trading System, were less contentious.

By the early hours of yesterday, member states announced they had agreed to gradually eliminate the free emissions allowances granted to certain industrial sectors. –