Mairead McGuinness – Photo © European Union 2022
(BRUSSELS) – The EU Commission published a set of sustainable finance rules Wednesday designed to attract green investment but which could do huge damage to EU environmental action, environmentalists warn.
The aim of the EU taxonomy is to improve the flow of money towards sustainable activities across the EU to help make Europe climate neutral by 2050. But although the taxonomy is portrayed as a science-based transparency tool for companies and investors, environmentalists say the Commission has bowed to pressure from France and others to ‘greenwash’ the taxonomy.
The Commission stresses that taxonomy classification does not determine whether a certain technology will or will not be part of EU Member State energy mixes. The objective is to step up the transition, by drawing on all possible solutions to help us reach our climate goals.
Taking account scientific advice, the EU executive considers there is a role for private investment in gas and nuclear activities in the transition. It says the gas and nuclear activities selected are in line with the EU’s climate and environmental objectives and will allow Europe to accelerate the shift from more polluting activities, such as coal generation, towards a climate-neutral future, mostly based on renewable energy sources.
Financial Services Commissioner Mairead McGuinness said: “The EU is committed to achieving climate neutrality by 2050 and we need to use all the tools at our disposal to get there. Stepping up private investment in the transition is key to reaching our climate goals. Today we are setting out strict conditions to help mobilise finance to support this transition, away from more harmful energy sources like coal.”
The Commission says the Complementary Climate Delegated Act introduces:
- additional economic activities from the energy sector into the EU Taxonomy. The text sets out clear and strict conditions, under Article 10(2) of the Taxonomy Regulation, subject to which certain nuclear and gas activities can be added as transitional activities to those already covered by the first Delegated Act on climate mitigation and adaptation, applicable since 1 January 2022. These stringent conditions are: for both gas and nuclear, that they contribute to the transition to climate neutrality; for nuclear, that it fulfils nuclear and environmental safety requirements; and for gas, that it contributes to the transition from coal to renewables. More specific additional conditions apply for all the above activities and are specified in today’s Complementary Delegated Act.
- specific disclosure requirements for businesses related to their activities in the gas and nuclear energy sectors. To ensure transparency, the Commission has today amended the Taxonomy Disclosures Delegated Act, so that investors can identify which investment opportunities include gas or nuclear activities and make informed choices.
The text of the Complementary Delegated Act now has to be formally transmitted to EU co-legislators for their scrutiny.
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