The European Green Deal, Europe's moonshot strategy

While it’s defining the future of millions and the roadmap for a continent, my personal guess is that the EU Green Deal will also become a great case-study of how to structure, communicate and deliver a strategy, despite a multitude of stakeholders and opinions and, what these days is called, a polycrisis.

The European Green Deal (#EGD), launched in December 2019, is meeting its objectives as a strategic framework, that puts all noses in the same direction of becoming the first #climateneutral continent by 2050. Despite all turbulences, Europe’s moonshot program was translated in a Climate Law, a plan (Fit for 55) for first deliverables by 2030, and a commitment to dedicate 30% of the EUR 2 trillion recovery and multi-annual budgets to climate efforts. The lead that Europe is taking in this Sustainability revolution, has not gone unnoticed on other continents, with similar climate neutrality commitments and, not so similar, budgetary support.

The European Green Deal is an integrated strategy: all important sectors (industry, housing, mobility, chemicals, agriculture, finance) have to take their responsibility; it’s not only about reducing #CO2, but also about protecting #biodiversity; and in the process ‘no one should be left behind’. This is creating an enormous transformation, a huge workload and a relentless effort to avoid contradictions. The fact that the #climate ambition is translated in regulation is, of course, causing political and sectorial discussions and pushbacks.

The strategy has been translated in tangible milestones, too long to all list here. Since July 2021 a formal European Climate Law has entered into force. This makes net zero greenhouse gas emissions by 2050 a legal obligation for the EU Institutions and its member States. And it includes the target to – already by 2030 - reduce emissions with 55% compared to 1990. In the car industry we see an acceleration to electrification; the building industry is concentrating on energy efficiency; the energy sector sees a growing part of renewables; and the financial sector is starting to implement new legislation (‘#SFDR’) to clarify the environmental and social (ESG) preferences of their customers and the ESG aspects of their investment offering. At the same time intense debates have been taking place on e.g. biodiversity versus agriculture (‘farm-to-fork’) or on the inclusion of nuclear and gas in the list of sustainable activities (the ‘EU #Taxonomy’);

The in July 2021 announced #Fitfor55 package includes a.o. proposals on the EU Emissions Trading System (#EUETS) (e.g. include shipping, international aviation, buildings and road transport), stricter energy efficiency and renewable energy targets for member states, measures to promote greener fuels for aviation and shipping, and a social climate fund to protect vulnerable households and small companies impacted by climate measures. Most of these measures are now being discussed between the three EU institutions (Commission, Council and Parliament).

Despite the obvious risk of delay or abandonment, the EU Green Deal strategy was upheld and even accelerated during COVID and the war in Ukraine. Both crises confirm fundamental vulnerabilities: vulnerability of our health, of our supply chains; of our energy and food systems. Although both crises must be taking an enormous amount of crisis management, the European Commission has built on these crises to accelerate the Green Deal. While, in the short term, energy security will require more fossil fuels, the #REPowerEU plan, announced last May, doubles down on energy efficiency, renewable energy and renewable hydrogen.

The most recent development impacting the EU Green Deal roadmap is the alternative approach the US is taking with the Inflation Reduction Act, subsidizing - primarily home-made - green energy and EV’s. With the Green Deal Industrial Plan proposed by European Commission President Ursula von der Leyen, the EU hopes to keep the momentum on this side of the Atlantic, with final outcome pending on currently ongoing high-level discussions.

In this geopolitical context and with EU elections coming up in 2024, it will be key to see how some flagship initiatives of the EU Green Deal can become enshrined in European legislation, such as: The in June 2022 proposed Nature Restoration Law  and the proposal to reduce the use and risk of chemical pesticides by 50% by 2030; The proposal of a Corporate Sustainability Due Diligence (#CSDD) obliging large companies to take legal responsibility for their social and environmental impacts;  The further development and clarification of the EU Sustainable Finance Taxonomy; And in particular the Corporate Sustainability Reporting Directive (#CSRD), the initiative to create transparency on the non-financial (or #ESG) performance of companies by strengthening their reporting obligations, ideally aligned with international reporting standards being developed as we speak.

In the current difficult economic and energy environment, the ultimate challenge will be to maintain and even accelerate the momentum of an energy transition, while avoiding and managing the social impacts. This is the European Green Deal in its essence!