The European Union needs to double its targeted investments to meet its 2030 climate change targets, a coalition of research institutes said on Tuesday, warning that the pace of related European action needs to accelerate.
Achieving the 2030 target is crucial for the EU to meet its ambitious target of net-zero greenhouse gas emissions by 2050 and end its contribution to global warming.
The European Climate Neutral Observatory (ECNO), which tracks the European Union’s progress towards carbon neutrality, said it had seen “promising signs of progress” in decarbonizing power generation and industry and adopting clean technologies.
But the report also noted that “overall progress is currently too slow.”
The group warned that a lack of climate finance is slowing down the transition.
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“Without a more favorable fiscal position and the realization of needed investments, the transition is likely to fail,” the summary for policymakers said.
The report is based on data from 2022, a year in which the EU was plunged into an energy crisis due to Russia’s invasion of Ukraine.
That year, the EU recorded an investment shortfall of 406 billion euros ($435 billion) in the energy, buildings and transport sectors alone, compared to what was needed to meet its 2030 climate targets, the researchers said.
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The EU has committed to reducing its greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels.
To meet climate targets, annual investment in these areas needs to double to €800 billion.
“The next challenge for the European Commission is a long-term investment plan on how to address the investment gap,” said report co-author Clara Kallipel of the Climate Economics Institute.
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The analysis compared spending and investment needs of households, businesses and governments across the EU’s 27 member states in 2022.
That year, fossil fuel subsidies tripled from 2021 levels to 190 billion euros as governments sought to support households and businesses facing rising energy prices.
Kallipel said subsidies for fossil fuels needed to be phased out and money used to fund the transition, including helping households retrofit their homes, install heat pumps and switch to electric cars.
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Speeding up climate action also means accelerating the deployment of renewable energy and phasing out coal, oil and gas.
The report says that to meet 2030 climate targets the share of renewable electricity needs to increase 1.4 times faster, while the EU’s fossil fuel phase-out needs to proceed 1.8 times faster, with the gas phase-out slowing.
chf/giv/bc
