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Tim Mohin: Europe’s Green Deal Finalized

Tim Mohin: Europe’s Green Deal Finalized

Europe's Green Deal Finalized
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After a green voting marathon, the EU Parliament closed its final plenary of this term before its June elections. The huge voting sessions yielded a plethora of new policies, including the Corporate Sustainability Due Diligence Directive (CSDDD), which we covered last week. There was also an amendment to the Corporate Sustainability Reporting Directive (CSRD), an EU version of the Inflation Reduction Act, and a host of other agreements. Here is a quick rundown of what went through:

  • The Net Zero Investment Act (NZIA)This is the EU’s version of the US Inflation Reduction Act. It is designed to improve the competitiveness of EU manufacturing of 19 net zero technologies ranging from battery storage to carbon capture. 
  • Ban on products made with forced laborCompanies will be investigated if there is verifiable information that they have sold, imported, or exported products made using forced labor. If found guilty, the company will have to remove its products from the EU market.
  • Withdrawal from the Energy Treaty Charter:The Energy Treaty Charter is an international treaty founded in the 90s that allows fossil fuel investors to sue countries for taking ‘unfair’ climate actions in private courts. This gives the EU, and its member states the freedom to enact climate regulations without the threat of litigation. 
  • Common agricultural policy:In light of the winter farmer protests, an update to the common agricultural policy exempts small farm owners from fines, and there will be additional exemptions in the case of extreme weather events.
  • CSRD update:As expected, the EU Council confirmed a two-year delay for sector-specific and non-EU reporting through the Corporate Sustainability Reporting Directive (CSRD). 

The lasting legacy of this five-year EU Parliament will be the Green Deal.  Since the Green Deal was announced in 2020, the EU has enacted a myriad of globally leading sustainability policies. Even with an expected rightward tilt in the June elections, these policies are locked in and can only be amended. 

However, with the elections looming, future actions to implement the Green Deal hangs in the balance. Foreshadowing how a more conservative parliament may govern, a leading right-wing politician, Nicola Procaccini, said, “Obviously the Green Deal was crazy and sort of a religion.” 

With political battlelines drawn, it seems the Green Deal is the most contentious election issue. EU Commissioner hopeful for the Greens Bas Eickhout said in a televised debate, “Let’s make these elections the Green Deal elections.” 

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