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EU’s trillion euro recovery fund must be made greener

While welcoming the targeting of environmental issues in the EU’s much-needed stimulus package, the European Environmental Bureau (EEB) warns that more needs to be done to phase out Europe’s dependence on fossil fuels, reform agriculture and move beyond economic growth.

Tuesday’s agreement on a landmark EU recovery and stimulus package, [1] worth over €1 trillion, marks a historic moment for inter-European solidarity. The deal comes at a time when the priority is fighting COVID-19 and protecting people’s health, while addressing the social and economic consequences of the coronavirus pandemic.

Heads of government were asked to improve the proposal put forward by the European Commission last month. [2]

The final deal does acknowledge that Europe is facing other historic crises, NGOs said. The EEB welcomes that the European Council has agreed to increase the target on climate action expenditure in the EU budget from the 25% proposed by the European Commission to 30%. The Council also signed up to making climate-related spending consistent with the EU’s goal of becoming climate neutral by 2050 and with the Union’s new 2030 climate targets.

While these political commitments pave the way for an expected overhaul of the current European climate and energy policy package to make it more ambitious and to align align it with the Paris Agreement, there remain several unknowns on the road ahead, especially regarding the lack of conditionality linked to the funds and governance.

Barbara Mariani, the EEB’s senior policy officer for climate and energy, said:

“The language on conditionality and flexibility leaves room to doubt whether the money will be invested to maintain fossil-fuel based economies or will be used to drive a step-change towards a climate-neutral and zero-pollution future, as announced in the European Green Deal. The climate neutrality target must be binding at national level and a clear timeline for phasing out fossil fuels must be set. More than ever, civil society is there to remain watchful and ensure that national planning will channel EU money in the right direction, otherwise the recovery plan will be a missed opportunity that will never return.”

When examining the figures more closely, the EEB found the details to be less than reassuring. Bérénice Dupeux, the EEB’s senior policy officer for agriculture, said:

“The announced €13 billion for rural development will be meaningless for the environment and climate if this budget is not linked to quantitative environmental and climate targets. Much worse, the Council’s conclusions show how member states misused flexibility by introducing the possibility to transfer up to 30% of rural development fund towards the most ineffective policy – direct payment.”

Furthermore, to achieve carbon neutrality through a just ecological transition that embraces sufficiency, the EU will have to move beyond economic growth towards a post-growth economy. Katy Wiese, the EEB’s policy officer for environmental and economic justice, said:

“It is positive that the EU recovery plan says that 30% of the budget will be used to foster climate action, but it is clearly not enough and fails to stop ‘business as usual’. The Just Transition Fund has been cut by almost three quarters. Public money should be used to accelerate the green transition and begin a reorientation towards wellbeing for people and the planet instead of GDP growth.”

Notes to Editors

[1] https://www.consilium.europa.eu/media/45109/210720-euco-final-conclusions-en.pdf [2] https://eeb.org/eu-plans-multi-billion-euro-green-recovery-but-falls-short-in-crucial-areas-1/