EU Leaders May Delay Landmark Decision on 2030 Climate Goal

The European Union may have to delay a decision on a stricter 2030 climate goal as a quarrel over strings attached to a jointly financed stimulus package risks spilling over into other policy areas.

Leaders of the bloc are supposed to discuss the draft European Climate Law, which would commit their countries to climate neutrality by 2050, at a Dec. 10-11 summit. But one key plank in the so-called European Green Deal, the target of reducing emissions by 55% compared to 1990 levels by the end of this decade, has yet to garner the required unanimous backing, according to an official familiar with the deliberations.

Reaching an agreement on the target, which looked challenging to begin with, appears trickier following a spat over the bloc’s budget for the next seven years and its economic recovery package funded by jointly backed borrowing. Poland and Hungary have blocked a deal, casting doubt over the financing of the transition to a low-carbon economy. Their move is likely to dominate next month’s summit, leaving little room for discussion on climate goals, the official said.

A potential delay could keep businesses from gaining clarity as they prepare for unprecedented changes under the European Green Deal. It could also shake trust in Europe’s ability to realize major initiatives, and have knock-on effects on secondary legislation expected in coming months in areas ranging from transportation to environmental levies.

Contentious Topics

It may be practically impossible for leaders to discuss and rule on several contentious topics at the same meeting, where they could also have to deal with the failure of ongoing negotiations over a post-Brexit trade deal, said the official, who asked not to be named discussing confidential deliberations.

A decision on whether an agreement on the 2030 goals is a realistic expectation from the summit will be taken in preparatory deliberations over the next 10 days, the official added.

The EU’s current goal is to cut 2030 emissions by 40% compared to 1990 levels. Increasing the target to 55% would require an additional 350 billion euros ($415 billion) per year in investments for energy production and infrastructure.

Countries including Poland have said they can’t commit to that goal unless they have assurances they’ll get sufficient financial assistance for the transition. EU leaders can only take decisions unanimously.

©2020 Bloomberg L.P.

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