Europe will compete with technological innovation for the decarbonization of the economy, through the large investments of the Green Deal

16/07/2020
Clara de la Torre, Deputy Director of DG Climate and MEP Nicolás González Casares point out the unique opportunity that the energy transition represents for the public sector and companies. Both have participated in a breakfast on the Green Deal and the future Climate Law organized by the Spanish Chamber in Belgium and Luxembourg in collaboration with ZABALA.

Europe has a unique opportunity to definitively decouple economic growth from CO2 emissions. In the midst of the global pandemic caused by the COVID, the European Commission's commitment to energy transition and the Green Deal (100,000 million euros) is shown to be the viable way for Europe to continue to differentiate itself through innovation and competitiveness. Both the Commission and the European Parliament have the goal of climate neutrality by 2050. To achieve this, the estimated emissions cut must reach 50-55% by 2030. Parliament has a more ambitious draft which estimates the cut at 65% to start negotiations. 

These are some of the most relevant conclusions from the breakfast debate organized by the Spanish Chamber in Belgium and Luxembourg in collaboration with ZABALA having had two of the expert speakers in defining European policies in this area. The Deputy Director of the European Commission's Directorate-General for Climate, Clara de la Torre, and the MEP Nicolás González Casares, member of the European Parliament's Committee on Industry, Research and Energy (ITRE Committee) and shadow rapporteur of the future Climate Law. 

Will the recovery be green?

In her speech, Clara de la Torre highlighted the role of digitisation and the green transition for the future of the EU. "25% of the funds have to be relative investments to fight climate change. The recovery will be green and sustainable and if not, it will not be recovery". Her message was strong in this regard: "The cost of inaction is much more expensive than the added cost. Health problems, floods are much more expensive. “

She added that the economy and competitiveness will benefit from it. She also pointed out that renewable energy is already the cheapest, considering all the impacts. As for possible destruction of jobs in sectors with less capacity to adapt, she considered that instruments such as the social fund and the just transition fund should serve to generate qualified jobs in alternative sectors. "Investing in new technologies and innovation is a secure source of growth. Europe is competing with quality and innovation. It is a golden opportunity so that we do not have to return to situations of the past that lead us to a dead-end".

In the same line, she pointed out the need for public-private collaboration, a fact that has also become relevant during the COVID crisis. Budgets must be oriented in this direction and the Climate Alliance is a demonstration of this fact.

In the same spirit, she pointed out that Europe can be proud "of being the only part of the world that has a legal framework that obliges us to reduce emissions by 2030". The Commission is working to carry out an impact analysis to increase this ambition and to specify the mix of political measures needed to achieve these objectives. The European Climate Act is under construction and it must be implemented by the Member States. This is the way to implement the Green Deal. "The Green Deal is not just a question of climate policy, technological economics, circulation, biodiversity, behavioural change, value chains, or industrial policy. It is a global vision of all the components of our economic system," said MEP Nicolás González Casares. 

For the representative in the European Parliament, the Climate Pact needs to go beyond legislation and all sectors of society must be involved. Once again, the public-private partnership is on the table, and so is the role of European citizenship. Social innovation and citizen participation have long been key actors for Europe, and now their consideration is essential in all guidelines. This shows the change in the role of citizens in the electricity and renewable energy guidelines. Regional and local authorities are also gaining ground in this area. 

The Climate Act must materialise the route to climate neutrality. To do this, impact assessment is essential and its results will be incorporated into the final discussions. 
Another recurring theme combines cohesion with climate commitments in Europe. González Casares pointed out that the most ambitious objectives in Parliament are that emissions neutrality must be achieved by each Member State, and for this there is no other remedy than to make progress in energy efficiency, renewable energies, changing transport systems, electrification, etc. 

The Just Transition Fund

In this scenario, the Just Transition Fund envisaged by the Commission is essential. The idea is to multiply its budget by five. "It will be mainly devoted to those countries that have to decarbonise their economy, such as Poland," said the MEP. 

Difficulties and opportunity

There is a potential for very large investments and for this the so-called "taxonomy" will play a key role in defining what is green and what is not in order to support financing for sustainable technologies. "Businesses have a decisive role to play in moving forward on this path. With these tools and regulatory framework it is time to act," said the MEP. And in the light of these business opportunities, "the legislation has to be firm and secure so that it can be carried out". 

The climate law will affect emissions traffic, and it is intended to include new sectors such as construction. Not all sectors are equally sensitive to a change in price, and this is part of the impact analysis being carried out by the Commission. 

In any case, Europe is at a crucial point in the negotiation of budgets, of how that money is going to be invested over the next seven years. Everything seems to indicate that the commitment to innovation will be green and sustainable, and there will be unique opportunities for those who are flexible and committed and prepared for this transformation. 

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