Against the backdrop of the 70th anniversary of the Schuman declaration, we publish a series on the EU’s future. Our Young Professionals Advisors reflect on the current state of the EU and propose a way forward to overcome the crisis. Read their view on how the EU should manoeuvre through the upcoming economic crisis.
CLIMATE & ENERGY
In our previous articles, we reflected on democracy, the financial crises, and healthcare in the EU. In this article, we’d like to discuss climate and energy in times of global warming, energy transition, and the Corona crisis.
The corona crisis has a profound impact on the world’s economy and by extension also on its carbon footprint. The restrictions in mobility and the diminishing levels of production and consumption associated with Covid-19 do have a downward effect on global emissions. According to the International Energy Agency, global greenhouse gas emissions could decline by almost 8 percent this year. This decline is however likely to be temporary.
The corona crisis might in fact bring the European Union further away from, rather than closer, to climate neutrality by 2050. As previous economic downturns, such as the financial crisis of 2008, have shown: once economic recovery kicks in, emissions tend to move back up to their original and even higher levels if no additional measures are taken.
The economic recession following the Corona crisis might diminish the capacity and willingness of governments, companies and households to invest in sustainability. Given the steep ramp-up of sustainable investments needed to reach the 2050 climate targets, such postponement of investments puts the timely attainment of these targets at risk. Choices that governments will make as they exit the crisis, will determine long term and structural impacts on their carbon footprint, their competitiveness and will curb reparations for climate damages.
European countries (EEA members) are already losing an average 13 billion euros a year to climate related extremes and this number is growing. But this is only the economic damage. There are also human fatalities, loss of biodiversity and lost land areas. The UN is warning of millions of climate refugees who will be forced out of their homes because of the impacts of the climate crisis. All this has far-reaching, possibly explosive implications. While the cost of achieving the climate targets might be high, the future costs of later cuts to greenhouse gases will be much higher.
The climate crisis and the coronavirus might be linked. World’s leading scientists warn that the destruction of natural habitats, decreasing biodiversity and the change in temperatures are heightening biological risks to humans, among other threats. Early studies also show that Covid-19 is more deadly in polluted areas. Thus, we are morally and strategically even more obliged to react to the climate crisis.
As climate change effects seem to keep on increasing (changing weather patterns, melting of the ice caps, warming oceans etc.), it is vital to come up with an EU level strategy on resilience and local adaptation in order to ensure our readiness for unexpected climate-related shocks. It is crucial for the EU to continue to commit to its ambitious climate agenda and the execution of the European Green Deal. Challenging times can stimulate great changes and it is up to the EU and its members to be decisive and committed.
In the short term, this means supporting clean energy projects, mobility schemes and life-style changes already taking place in the Member States. Apart from coping with the difficult situation emerging from virus management and the related economic fallout, Member States should focus even more on designing policies to execute the Green Deal in order to provide the needed clarity and certainty to the EU’s citizens and companies. Going half-way doesn’t help anybody, it creates uncertainty and inefficiency. So, we have to do what we know is the right thing but might have seemed too disruptive at other times.
In the medium to longer term, it means directing economic stimuli specifically at those sectors that can contribute to a resilient and climate-neutral economy in 2050. Economic recovery measures should be viewed through the lens of their contribution to the aims of the European Green Deal and especially investments in climate transition enabling projects and infrastructures should be stimulated. Europe should be straightforward in this: our suppliers from outside the EU should also fulfill our high climate requirements in order to avoid carbon leakage and maintain the competitiveness of our own companies. However to be achieved, via a carbon import tax or other measures, this will be very hard to achieve.
At a recent Young Professional Seminar in Paris, we concluded that the transition to climate neutrality requires profound changes in all parts of the value creation and economic chain. A far-reaching CO2 reduction can only be achieved through significant electrification of industrial processes and mobility, which leads to an enormous increase in low-carbon electricity demand. Therefore, a radical reduction in the price of electricity from renewable energy sources, including lower government surcharges and levies, is an essential prerequisite for successful industrial change. Ultimately, we need to move towards a low-carbon EU internal market where there is both demand and supply for low-emission products.
To be competitive in a global market, Europe should focus on at least allowing European champions in renewable energy production and clean industrial and chemical processes. In its Green Deal, the EU Commission should therefore examine how collaborative and innovative corporate ecosystems and global European players can be promoted. The assessment of potential barriers arising from consumer-oriented competition law requirements, for example, and how these concerns can be reconciled with the need for a consolidated European response to foreign competition, could also be appropriate points for the European Green Deal.
We need focus here: we cannot implement contradicting strategies. As a recent study by the European Court of Auditors shows, European investment has not enabled positive change in the way we move in our growing cities. The EU has invested 16 billion to make mobility more sustainable but as the instruments were lax, we’ve gotten another wave of congestion. This means that climate action should be present in every action we undertake.
To promote long term capacity for the energy transition and to combat corona-induced unemployment, the training and retraining of workers should be another high-level priority. This is important not only for the energy transition but the transition of societies and their most vulnerable members to a new reality in work and skills acquisition. The crisis with its high unemployment numbers has highlighted that.
On the European level, directing funds to critical Trans-European Networks in, for example, the field of hydrogen or carbon dioxide transport might be a good way to steer economic recovery measures towards promoting climate change mitigation. On the more regional level, focusing on bottom-up processes such as energy communities and regional strategies, e.g. collective housing insulation, could be an ideal way to combine the energy transition with strengthening the local economy.
Europe might not be the biggest emitter of greenhouse gases but it is a strong example for the rest of the world. Life-style trends created here have an impact. For this, it is a very welcome initiative that European cities are boldly allocating street space away from cars towards bicycles, transforming the car-centric, energy and space intensive cities. We would now need a “bicycle moment” in all walks of life: going forward or indeed going back to less energy-consuming lifestyles, promoting climate, public health and economic action at the same time.
Europe’s unique history and its capacity to adapt bode well for achieving the necessary changes ahead towards the 2050 goals. It’s time to take strong initiative on all levels, the EU level, member state level, on community and personal levels. Now more than ever, Europe should act as a lighthouse, pointing towards a carbon-neutral, a biodiversity preserving and a prosperous life model for the world.
Authors: Albert Guasch, Kalina Trendafilova, Dyria Alloussi, Raiko Puustusma, Dinand Drankier, Justinas Lingevicius, Mihkel Kaevats, Felix Klein, Karl Luis Neumann, Silja Raunio, Anna Penninger, Armando Guçe, Mihály Szabó, Andranik Hovhannisyan, Raphael Kohler, Jens-Daniel Florian, Elif Dilmen, Eshgin Tanriverdi, Robert Grecu.
About the YPAs: We are a group of 36 United Europe Alumni from 20 countries. We consider ourselves a task force for United Europe e.V.,promoting young leadership from various regions in Europe. We represent diverse and young European voices on the EU’s most pressing issues. We aim to restore trust in the European project among the youth and citizens of Europe. We are a network that promotes professional exchanges between young Europeans and give impulses for a more European way of thinking. We promote plurality and want to generate new ideas for smart analysis of EU policies.