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Weekly Short
22 July, 2021
Last week, the EU launched ‘Fit for 55’, which is neither a public health campaign nor an age-specific dating app, but actually the (curiously named) policy agenda for meeting its commitment to reduce emissions by 55% by 2030.
With the target having been set during a bumper-crop week for climate commitments in April, the proposals mark the start of reform to align the EU’s laws and policies with this climate target. The proposals are thorough and far-reaching, including banning combustion engine cars by 2035, increasing the costs for aviation and fossil fuel heating, and using the revenue raised by expanding the carbon market to create a €72 billion fund to make the transition fair.
But what is most interesting is that, unlike equivalent national climate plans, the EU is the largest trading bloc in the world and its influence goes far beyond its borders. This is most clear with the carbon border tax, which will introduce a levy on certain imports from countries with weaker climate policies. And, although this will create tensions with some countries, the long phase-in period shows a willingness to bring other countries along with this change. There are clear incentives for multinational companies trading across the EU border to make their products and services less emissions intensive and the innovations that will accelerate this.
Before we can get too excited, the proposals need to be accepted by the member states, and there have been objections and friction already. Meeting these targets will be “bloody hard”, as Frans Timmermans suggests. But this is a promising first step, even if the name isn’t.
By Patrick Bapty