EU sets new climate goal for 2040 High ambition, yet gaps persist

Down To Earth has published an article noting that dependence on carbon capture, utilisation and  storage is concerning, raises questions on ambition of the target. Caliber.Az reprints the article.

On February 6, 2024, the European Union (EU) introduced via the European Commission its new proposed 2040 climate goal. It laid out a net emissions reduction target of 90 per cent by 2040 compared to the 1990 baseline levels.

In September 2020, EU had announced a goal to cut greenhouse gas (GHG) emissions by 55 per cent below 1990 levels by 2030, compared to 40 per cent earlier. It was submitted as a second Nationally Determined Contribution to the United Nations Framework Convention on Climate Change (UNFCCC) in December 2020.

It was enshrined in the EU Climate Law in 2021, which also laid out a commitment to reach carbon neutrality by 2050. To accompany the target, the Commission released a “Fit for 55” package in 2021, which provided a set of proposals to achieve the 2030 reduction target.

The latest 2024 proposal is an interim step required by the EU Climate Law, which outlines a process to develop a 2040 target within six months of the first Global Stocktake (GST), which concluded at the 28th Conference of Parties to the UNFCCC in Dubai in December 2023.

Fossil fuel phaseout sees a timeline for coal, but with caveats

A critical output of the GST was the call to transition away from fossil fuels. The 2040 target by the EU outlines a roadmap in line with this, stating that coal will be almost completely phased out by 2040, natural gas will rapidly decline in use and oil will be the last to be phased out.

It did, however, add that a small number of fossil fuels will remain in the mix and largely be used for non-energy purposes and long-distance transport. Imports of fossil fuels will decline as the energy mix changes, at the same time the need for rapid deployment of renewable energy sources might lead to imports of raw materials and critical minerals, the target said.

The war on Ukraine led to an energy crisis in the EU, which was heavily dependent on Russia for its natural gas needs. Supplies were cut by nearly 80 per cent, forcing the Commission to diversify its energy suppliers and mix. It has since been a key importer of liquefied natural gas (LNG).

In parallel, it has seen record rises in renewable energy uptake, with wind and solar overtaking fossil gas for electricity generation in 2022.

The EU relies on the United States, the Middle East and Africa for LNG imports. Both France and the Netherlands have recently signed gas deals with Qatar and reports of deals with countries like Nigeria and Mozambique have also surfaced. While the proposed target is expected to enhance the Commission’s independence from fossil fuels, these deals are expected to result in gas imports well after 2050.

These deals could result in a higher risk of carbon lock-in and stranded assets, especially for countries in the African continent who are building capacity to support exports and more so if the EU’s new climate target facilitates reduced fossil fuel imports eventually.

Missing reflection of the EU’s historical emissions burden

While the 2030 goal of 55 per cent reduction would lead to an absolute emission level of 2.16 gigatonnes of CO2 equivalent based on 1990 levels, the 90 per cent goal would mean an absolute emission level of 0.48 gigatonnes of CO2 equivalent.

However, civil society has critiqued EU for not keeping its targets in line with its responsibility as a historic polluter. Climate Action Tracker suggests that the Commission would ideally need a target of 65 per cent emissions reduction by 2030 and at least a 95 per cent reduction by 2040 compared to 1990 levels to remain on a 1.5C pathway and to address its fair share.

Even the European Union Scientific Advisory Board for Climate Change had suggested a reduction range of 90-95 per cent, and the final proposal seems to have stuck to the lower limit of the range. Taking into account the dependence of the proposal on carbon capture and carbon removal solutions, however, shows that the actual reduction level is not clearly represented.

Heavy faith on carbon capture & CO2 removal

The proposal expects carbon removals to reach up to 400 tonnes CO2 by 2040, up from 310 tonnes CO2 removal by 2030 as envisioned in the 2021 plan.

Analysis by Climate Action Tracker suggests that if this dependence on carbon capture usage and storage (CCUS) and carbon dioxide removal (CDR) technologies is removed, the actual reduction will only be about 84 per cent by 2040.

The proposal addresses full decarbonisation of the energy sector “a little after 2040”. But this is expected to be achieved with a mix of renewables, nuclear, hydrogen, CCUS and CDR. CCUS is also mentioned as a requirement for industrial decarbonisation, although targeted at the ‘hard to abate’ sectors. The dependence on CCUS, which still remains largely unreliable as an effective climate action strategy, is concerning and raises questions on the ambition of the target.

In fact, the Institute for Energy Economics and Financial Analysis noted that around 40 per cent of the carbon capture aim is expected to come from direct air capture alone, which costs anywhere between $600 and $1,000 per tonne of carbon.

Concessions for agricultural sector

An earlier leaked draft of the proposal had strong targets on the agricultural sector – a 30 per cent emissions reduction between 2015 and 2040. The agriculture target was in line with recommendations by the European Union Scientific Advisory Board on Climate Change, given that nearly 11 per cent of the emissions in the EU come from the sector.

However, the final proposal has pulled back on this target, now mentioning that all sectors need to contribute to the target and a dialogue with the agriculture sector stakeholders is required. This seems to have come in response to widespread farmer protests across EU.

Parallel climate policies to be factored in

The 2040 proposal is the latest in a series of climate-focused policy measures taken up by the Commission.

Trade regulations came in the form of the Carbon Border Adjustment Mechanism (CBAM), which was introduced in 2022, with the transition period to enact it beginning in October 2023. It garnered criticism largely from developing nations. This included India and South Africa, who are exporters to the EU and say it will lead to enhanced costs in the Global South countries.

In 2022, the Commission also introduced its Green Deal Industrial Plan, which included initiatives such as the Net Zero Industry Act and the Critical Raw Materials Act. These are expected to boost domestic manufacturing of strategic green technologies.

On February 6, the parliament also debated and finalised the Net Zero Industry Act (NZIA), which has various provisions to boost domestic production of green technologies such as renewables, energy storage and electric grids. Reports suggested that entities in the EU also wish to see the scope of the NZIA expanded to nuclear power.

Groups have criticised NZIA for extending support to technologies such as CCUS, which is regarded as comparatively unreliable and expensive at this stage. NZIA is expected to come into force later this year.

The 2040 proposal is now set to be debated following the upcoming EU elections. The newly elected Commission is expected to take the steps to include the target in the EU Climate Law.