The EU wants to achieve climate neutrality by 2050, then it will aim for negative emissions

The existential threat resulting from climate change demands that the EU as well as its member states heighten their ambitions and intensify their measures. This is reflected not only in the EU’s approach to the European Climate Law and in the constant collection and analysis of data (referring to carbon rates, for example), but also in a change of the judicial ruling practice. In a recent ground-breaking verdict, a Dutch court ordered a private company to adjust its activities with regard to the need for tackling climate change.

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The EU’s climate neutrality will be incorporated into the respective legislation by 2050

In the previous edition of the EnviLaw newsletter, we reported on the EU’s new strategy for adapting to climate change. This time, we are again going to focus on measures concerning climate: on 28 June 2021, the EU Council adopted, at first reading, its approach to the European Climate Law, which means the legislative process has been concluded and the target of achieving the EU’s climate neutrality by 2050 has been incorporated into the respective legal regulations.

The target of climate neutrality is for EU-wide greenhouse gas emissions and removals – which are regulated by EU law – to be balanced by 2050 at the latest, decreasing them to net zero by the given date. After this date, the EU will strive to achieve negative emissions. To this end, the European Climate Law stipulates a legally binding EU target for 2030, which is a net reduction of greenhouse gas emissions by at least 55% compared to the levels in 1990.

At the same time, the Commission is to adopt an EU Strategy on Adaptation to Climate Change. Consequently, member states will need to create their own strategies which should reflect the specifics of the individual states. The Commission will regularly re-evaluate these strategies and study their compliance with the targets of the EU as a whole. Measures in the field of tackling climate change should, among other things, present opportunities for all sectors of the EU’s economy and should contribute to the EU’s industry holding a leading position in global innovations.

Increase in carbon prices to support transition to greener solutions

Carbon pricing is a very efficient manner of supporting the shift of production and consumption towards low-carbon and zero-carbon alternatives, which are a necessary step in limiting climate change.  The Effective Carbon Rates 2021 report measures the prices of CO2 emissions based on energy consumption in 44 OECD and G20 countries. It covers approx. 80% of global emissions and provides an evaluation of carbon prices since 2018, along with an assessment of the impacts of the more ambitious greenhouse emission trading in China and in the EU.

The above report monitors the structure of carbon pricing across countries and industries. It also provides a comprehensive overview of carbon prices, including fuel excise taxes, carbon taxes and tradable emission permit prices. The report shows that the overall progress in the field of carbon pricing remains very moderate. Although no country has achieved the target so far, the countries that have been increasing their carbon prices balance these investments against the costs of emissions for society, thus choosing the transition to greener growth.

Dutch court has assigned climate-related obligations to a private company

On 26 May 2021, the court in Haag issued a ground-breaking verdict, stipulating that Royal Dutch Shell (RDS) is obliged to decrease, through the company politics of the Shell group, the CO2 emissions from the group’s activities. By the end of 2030, the emissions must be reduced by a net 45%, as compared to 2019. In other words, the court ordered a private company to adapt its activities to combat climate change.

This obligation to reduce emissions is to concern the entire energy portfolio of the Shell group and the aggregate volume of all emissions. In its verdict, the court further states that it is the responsibility of RDS to propose the reduction obligation with regard to its current commitments as well as other relevant circumstances. The court explains that RDS is in the leading position of the Shell group, which consists of approx. 1,100 companies and is active in 160 countries worldwide. RDS has a very important political position in the group. The Shell group is a key player in the global fossil fuels market and it is responsible for large CO2 emissions. These not only exceed the limits of the emissions produced by many states; they also contribute to global warming and the dangerous climate change that is taking place in the Netherlands, not to mention the serious and irreversible impacts on the human rights of – not only – Dutch citizens.

The German Constitutional Court has decided that low environmental targets violate human rights

In another break-through verdict, the German Constitutional Court has ruled that the German government is violating the human rights of the young generation by reducing emissions too slowly. The target stipulated by the German legislation is “only” a 55% decrease in emissions by the end of 2030. However, it is clear that after 2030, the rate of reducing emissions will need to be significantly increased, so that Germany complies with the Paris Agreement. The fact that the environmental targets have been set at a relatively low level only postpones the emission-reduction problem until after 2030, meaning that the young generation will need to deal with the problem of climate change. Thus, according to the Court, the basic rights of the young generation have been violated. In practice, this means that it is not sufficient for governments to commit to mid-term targets without any further plans. Instead, a detailed strategy is necessary, naming the steps that the states will take and the outcomes of the combat against climate change that citizens may expect in ten years. If this is not the case, the states are only postponing the problem and leaving it to the next generation to deal with, which is a violation of the next generation’s rights.

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