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European Commission endorses fossil fuels as ‘transition’ fuel

The European Commission has approved in principle a Complementary Climate Delegated Act which lists specific nuclear and gas energy activities among those covered by the EU taxonomy.

In a statement, the EC said that the criteria for the specific gas and nuclear activities are in line with EU climate and environmental objectives and will help accelerated the shift from solid or liquid fossil fuels, including coal, towards a climate-neutral future.

The EC also said that the act not only introduces additional economic activities into the energy sector under the EU Taxonomy, but that it also brings in specific disclosure requirements for businesses related to their activities in gas and nuclear power generation.

Mairead McGuinness, commissioner in charge of Financial Services, Financial Stability, and Capital Markets Union, said: “The EU is committed to achieving climate neutrality by 2050 and we need to use all the tools at our disposal to get there. Stepping up private investment in the transition is key to reaching our climate goals. Today we are setting out strict conditions to help mobilise finance to support this transition, away from more harmful energy sources like coal. And we are boosting market transparency so that investors will be able to easily identify gas and nuclear activities in any investment decisions.”

Anything the EC proposes comes with some degree of controversy, and the same is true of this, with critics accusing the organisation of helping companies ‘greenwash’ investments. There will also be, others reported, more far-reaching effects.

The website Climate Home News spoke to Maria Pastukhova, a gas analyst for E3G. She said that the decision to include gas had been a ‘disastrous signal’ for investors in the Korean energy sector.

Pastukhova spoke about various countries around the world with their own green taxonomies, and of what the impact of the EC’s decision would be.

She added: “All these have been inspired by the EU effort to create the taxonomy […], so the EU taxonomy has global visibility and symbolic power and inclusion of gas has done some real damage to this symbol. It’s very likely that they will also consider including gas in their own taxonomies particularly if they are developing countries.”

While the EC’s draft has been approved in principle, it will be formally adopted when all the language versions are made available.

Pete Carvill

Pete Carvill is a reporter, writer, and editor based in Berlin who has been writing for the B2B and mainstream media since 2007. He is a contributing writer for Expert Investor and, in addition, has...

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