Yesterday began with sad news: David Sassoli, President of the European Parliament, passed away on Tuesday night. His death caused consternation in Brussels and far beyond – especially in Sassoli’s home country of Italy. “È un giorno triste per l’Europa,” a sad day for Europe, said President of the European Commission Ursula von der Leyen. In his obituary, Eric Bonse looks back on Sassoli’s career and his role in the EU.
It is not the best news that Germany’s Minister for Economic Affairs Robert Habeck had to share at the presentation of the opening balance sheet on climate protection. CO2 emissions have not fallen sharply enough, and the expansion of renewables has progressed too slowly. The government now wants to triple the pace of climate protection. In doing so, the German government is relying fully on the EU, as Lukas Scheid reports.
The introduction of a CO2 border adjustment for imported goods (CBAM) is one of the most controversial measures in the Fit for 55 package. Critics doubt that the climate tariff can be implemented in compliance with WTO regulations, fear trade conflicts with partner countries, and a high risk of carbon leakage due to the discontinuation of the free allocation of emission rights. If the demands of the CBAM rapporteur in the EU Parliament are anything to go by, this should be phased out even earlier than envisaged by the Commission. Environmentalists welcome the proposals, but there is an outcry among industry associations. Timo Landenberger has the details.
On Tuesday, Minister for Economic Affairs and Climate Action Robert Habeck took a look in the rear-view mirror “perhaps for the last time,” as he himself put it. At the presentation of the opening balance sheet of climate protection, he outlined the current backlog in efforts to reduce emissions in energy supply, industry, the building sector, and transport. Between 2010 and 2020, CO2 emissions had dropped by 15 million tons a year. This is not enough, after all, a reduction of 36 to 41 million metric tons per year is needed by 2030 to achieve the climate protection targets, Habeck said.
The Vice-Chancellor also said that the expansion of renewable energies has so far proceeded too slowly. It took 30 years to achieve a share of renewables in gross electricity consumption of around 40 percent. However, by the end of the current decade, Germany wants to be at 80 percent – measured against the significantly higher expected electricity demand in 2030.
However, Habeck’s assessment is not just a reckoning with the climate policy of the past decades but rather reflects the scale of the tasks ahead in this legislative term. It indicates the direction of two packages of measures that are to come at Easter and in summer to complete all legislative and review bodies, such as necessary notifications at the EU level, in time before the end of the year. Both packages of measures are expected to come into force as early as 2023.
In it, he wants to triple the pace of climate protection and does not rule out adjustments to the German Climate Change Act. But the German government is also counting on the rapid implementation of the Green Deal. The measures of the Fit for 55 package are intended to make fossil fuels uneconomical through high CO2 prices. The 37-page report by the Federal Ministry for Economic Affairs and Climate Action (BMWi), therefore, calls for an ambitious reform of the ETS. In principle, Germany could play a key role in the Fit-for-55 dossier, the paper says.
Habeck also calls for an integrated European power grid. Europe would make faster progress in the energy transition if the grid were better. Everyone would have to make their own contribution. This would also require electricity imports and exports – of which there are not yet enough, he said. However, he is not thinking of French nuclear power or Polish coal-fired power – which will not be needed – but rather of energy partnerships such as the German-Norwegian Nordlink power cable.
Germany is currently a net exporter of electricity, added State Secretary Patrick Graichen. The nuclear phase-out at the end of 2022 is expected to balance the books next year. Despite its climate protection plans, Germany would not be dependent on foreign energy imports.
However, in order to achieve an 80 percent share of renewable energy (about 715 terawatt-hours) by 2030, numerous new plants will have to be added. According to the BMWi, there was even a decline in renewable capacity in 2021. So in order for the expansion to proceed faster, it is to be classified as “in the overriding public interest and public safety.” Thus, areas for solar and wind power plants are to be created more quickly. The 2-percent target for wind power is to apply equally to all German states. However, Habeck did not rule out the possibility that a state that fails to meet its own targets can have the corresponding share compensated by another state.
In the long term, the expansion of renewables should also benefit the industry, which is to be supplied with low-cost green electricity that is exempt from levies. Decarbonization is considered one of the biggest challenges. Compared with the COVID-19 crisis year of 2020, 30 million more tons of process-related emissions were expected to be emitted in 2021.
The expansion is to be flanked by a revised hydrogen strategy and additional subsidy programs so that emissions-intensive industries, in particular, can produce with green hydrogen in the future. By 2030, 10 gigawatts of electrolyzers are to be added, the import of hydrogen is to be expanded, and the network infrastructure is to be built up for a “reliable and efficient supply overall,” it says. So-called hydrogen IPCEIs (Important Projects of Common European Interest) and carbon contracts for difference are also to help with rapid implementation.
Following the phase-out of nuclear power and coal, green hydrogen should also enable the phase-out of gas in a third step. However, for this to happen, the “secured capacity needed to maintain security of supply” must be available, and the end of natural gas use must be “widely accepted by society and legally secure in regulatory terms,” it says. The electricity market design is also to be adjusted accordingly. A newly created “climate-neutral electricity design” platform is to discuss what the adjustments might look like.
The expansion of renewables and the abolition of the EEG surcharge from 2023 are also intended to ease the burden on private households. Heating costs are to fall, energy efficiency is to be increased, and 50 percent of thermal energy is to be produced climate-neutral by 2030. The German government wants to anchor these goals in a new “Climate Neutrality Building Strategy”. The Federal Ministry for Economic Affairs and Climate Action also wants to revise the Building Energy Act together with the newly established Federal Ministry of the Interior, Building and Community under Social Democrat Klara Geywitz in order to bring new buildings and renovations into line with the climate targets.
The transport sector is also considered particularly difficult to decarbonize. With advancing electrification and energy supply from renewables, the German government plans to reduce emissions to 85 million metric tons in 2030. Compared to 2019, that would be half. The target of 15 million EVs by 2030 set out in the coalition agreement is to be accompanied by the expansion of the charging infrastructure – one million charging stations by 2030. From 2025, this would require 100,000 charging stations to be added annually to those already in place or planned.
In addition, vehicles that can demonstrably be fueled exclusively with e-fuels should be able to be registered even after the discussed phase-out of internal combustion engines. However, this would require e-fuels to be taken into account in the EU’s CO2 limits. The Commission had not provided for such an exception in its proposal, and e-fuels were also not included in the draft report by rapporteur Jan Huitema.
The Fit for 55 climate package is visibly taking shape. The majority of the measures are to be adopted before the end of this year. This is an ambitious goal, given the complexity of the negotiations on the plans, some of which are highly controversial.
A foretaste is provided by the planned CO2 limit compensation for imports (CBAM), which had already caused quite a bit of controversy in recent months. Last week, the EU Parliament’s rapporteur, Mohammed Chahim (S&D), presented his draft – and fueled the debate with his partly far-reaching amendment proposals.
Accordingly, Chahim wants to introduce the CBAM more quickly than envisaged by the Commission and shorten the planned transition phase from three years to two. In addition, Chahim calls for the allocation of allowances to be reduced to 90 percent as early as 2025, to 70 percent in 2026, and to 40 percent in 2027. By the end of 2028, the allocation of free certificates is to be phased out completely – and thus seven years earlier than planned by the Commission.
The industry reacts appalled to the demands. The Wirtschaftsvereinigung Stahl (German Steel Industry Association), for example, criticizes that the down melting of free emission allowances already means a considerable additional burden per se for companies in the transformation, which massively complicates the switch to low-CO2 processes. “If there were to be no more free allocation as early as 2028, this situation threatens to get even worse,” WV Stahl President Juergen Kerkhoff tells Europe.Table. “In order to avoid experiments at the expense of the steel industry’s competitiveness, new instruments should be extensively tested, and already established and target-oriented paths for carbon leakage protection should be maintained during this period.”
The German Chemical Industry Association (VCI) is also opposed: “This would place an additional burden on chemical customers in the EU’s internal market and also significantly impair our export opportunities on the global market, as exports from the EU would be burdened with higher climate protection costs that our global competitors do not have,” says Joerg Rothermel, Head of Department Energy, Climate Protection and Raw Materials. Ultimately, the CBAM does not yet provide a solution for exports.
According to the VCI, many additional steps would be necessary, for which there is no concrete design yet. These would include emissions reporting by foreign plants, processing at the border by customs, and verification of the information. If the introduction is rushed, there is also a great risk that importers could circumvent the CBAM requirements and thus no longer have any protection on the European market.
Peter Liese, environmental policy spokesman for the German CDU/CSU in the EU Parliament, calls Chahim’s assumption, that the CBAM can function this quickly without any problems, “naive”. The Commission’s more cautious approach is more sensible here: “The bottom line is that I see a great risk of carbon leakage if the plans are implemented as they are,” Liese says. However, Chahim had assured him several times that he saw his proposals only as a starting point for discussion. “That’s why I’m very optimistic that we’ll be able to steer him away from his overambitious plans in the course of the negotiations.”
However, the CDU MEP fears that protection against carbon leakage will be undermined even if the Commission proposal is adopted unchanged. Liese is the EU Parliament’s rapporteur for the revision of the Emissions Trading Scheme (ETS), which is closely linked to the CBAM. The CDU MEP plans to present his draft report on Friday.
However, Liese has already announced his intention to include some kind of CBAM hedge in the ETS: Accordingly, emission allowances that are no longer issued free of charge to the industry as a result of the introduction of CBAM should not be canceled but set aside as a reserve for one year. “In the event that the CBAM does not function or does not function sufficiently, these certificates could be distributed to the affected companies to prevent carbon leakage,” explains Liese.
For the environmental organization Germanwatch, on the other hand, a faster end to the free allocations is an important step forward. “Only the full auctioning of CO2 certificates will give companies sufficient incentive to convert their production to climate-friendly methods,” says Anne Glaeser, Policy Advisor Carbon Pricing at Germanwatch. A longer transition period carries the risk that European heavy industry will miss the transformation.
Michael Bloss, the environmental policy spokesman for the Greens in Brussels and ETS shadow rapporteur, is also convinced: “The instrument will not get better by waiting longer.” An earlier date of introduction is therefore conceivable.
In his draft report, Mohammed Chahim also calls for the extension of the CBAMs scope to include organic chemicals, hydrogen, and polymers. Unthinkable for the VCI: “We plead for the chemical industry to be completely exempted from CBAM, at least in the first phase. Under no circumstances should there be an extension to large parts of the chemical industry, as proposed by the rapporteur. That would significantly increase the problems for our industry,” Rothermel said.
And WV Stahl is also skeptical, especially about the expansion to hydrogen. “In order to meet the high demand, the industry will also have to rely on imports. Overly strict regulation must not prevent the supply of hydrogen and thus slow down the transformation,” says Kerkhoff.
However, hydrogen would only be affected by the CBAM if it is produced using fossil fuels. “Including H2 in the CBAM is, in my opinion, a signal to trading partners to focus on green hydrogen in order to avoid a CO2 cap-and-trade tax,” says Susanne Droege, CBAM expert at Stiftung Wissenschaft und Politik. (For an interview with Susanne Dröge, see tomorrow’s issue of Europe.Table).
The question of how the revenues from border adjustment are to be used and how the green transformation of poorer trading partners is to be supported is also causing controversy. According to the draft report, only the least developed countries, i.e., the economically poorest countries in the world, are to be supported. For Michael Bloss, this is a step in the right direction: “The instrument should serve the green transformation and not be a new tool to boost the budgets of industrialized countries in Europe.”
A large part of the revenue from the border adjustment is nevertheless to flow into the EU budget and the administration of the CBAM. According to Germanwatch, this is the wrong signal. Instead, the majority of the revenue, as well as other funding, should flow to middle- and low-income partner countries, it says. “This is crucial to get the instrument out of the confrontational-protectionist corner and into a more cooperative tool,” says Anne Glaeser of Germanwatch.
Among the countries most affected by the CO2 border adjustment are Ukraine and Turkey. The proposal does not provide any support for them. However, the EU should “support the industries of the countries particularly impacted by the CO2 limit offset on the path towards climate neutrality,” says Glaeser.
The CBAM does not bring in enough money to refinance decarbonization abroad, Droege counters. Countries like Turkey or Ukraine could raise the money themselves “by introducing a CO2 price or increasing the existing one, which they can then offset against the CBAM.” Least developed countries cannot do this so easily because their governments usually lack governance.
He declared a climate emergency, pushed the Green Deal, and backed the multibillion-dollar COVID Recovery Fund to pull the EU out of the crisis. But David Sassoli, the president of the European Parliament, will not live to see the long-term results of his work.
On Tuesday morning, Sassoli died in Aviano, northern Italy – a week before the end of his two-and-a-half-year term. The 65-year-old had been hospitalized at Christmas; he died of an immune system disorder, according to official reports.
Sassoli, who belonged to the Partito Democratico, had led the Parliament since 2019. His term would have ended at the end of this month because the Social Democrats and the conservative EPP family of parties share the five-year legislative term in the presidency. Already in fall, Sassoli had fallen ill with severe pneumonia.
News of the death of the popular but little-known politician outside Italy has caused consternation far beyond Brussels. “Sassoli was a symbol of balance, humanity, and generosity,” Italy’s Prime Minister Mario Draghi said in Rome.
“Today is a sad day for Europe,” said EU Commission President Ursula von der Leyen. The EU is losing a “passionate European, a convinced democrat, and a good person,” the CDU politician said. Sassoli’s smile will be missed.
However, relations between the two EU leaders have been rather frosty of late. Because von der Leyen is not taking enough action against violations of the rule of law in Hungary and Poland, the Parliament has initiated an action for failure to act before the European Court of Justice – a first.
Even the beginning of the cooperation, which was marked by the climate crisis and the COVID-19 pandemic, was not easy. Sassoli, who won a third mandate in the 2019 European elections, saw himself as an adversary of the Commission president, who had been appointed by the Council. “I was not on the list of EU leaders, I am not a product of the Council,” Sassoli said in an interview with “Politico”. Unlike von der Leyen, he said, he emerged from a democratic process. However, his election in 2019 was a surprise even for insiders.
Sergei Stanishev, President of the Party of European Socialists (PES), was considered the favorite. Hardly anyone had Sassoli on their radar. But the political science graduate, who later worked as a journalist and anchorman on Italian television, prevailed.
As a committed Catholic, he was also electable to conservatives. His authoritative style made him an ideal compromise candidate. Sassoli was also appreciated for his rhetorical talent. His inaugural speech was a flaming appeal against nationalism.
Unlike his German predecessor Martin Schulz (SPD), however, Sassoli was hardly able to set his own accents. This was due to the superiority of the Council, which more than ever determines EU business, – but also to the COVID pandemic, which massively hinders the work of the European Parliament.
In recent months, Sassoli has increasingly lost control of Parliament. He toyed with the idea of running for a second term to make up for lost time, but his plans were thwarted, not least by his own comrades. The Social Democrats got involved in the usual dealings with the EPP in Parliament and put together a new personnel package for the second half of the legislative term, which begins in February.
Accordingly, the arch-conservative EPP politician Roberta Metsola from Malta is to take over the leadership of the European Parliament. She already took up her new post on Tuesday in an executive capacity. In turn, the conservative German Secretary-General Klaus Welle (CDU) could step down.
The final details of the personnel package are to be finalized this week. Metsola’s official election is then scheduled for next week’s plenary session of the European Parliament in Strasbourg. Before that, there is to be a memorial ceremony for Sassoli on Monday. Eric Bonse
Yesterday began with sad news: David Sassoli, President of the European Parliament, passed away on Tuesday night. His death caused consternation in Brussels and far beyond – especially in Sassoli’s home country of Italy. “È un giorno triste per l’Europa,” a sad day for Europe, said President of the European Commission Ursula von der Leyen. In his obituary, Eric Bonse looks back on Sassoli’s career and his role in the EU.
It is not the best news that Germany’s Minister for Economic Affairs Robert Habeck had to share at the presentation of the opening balance sheet on climate protection. CO2 emissions have not fallen sharply enough, and the expansion of renewables has progressed too slowly. The government now wants to triple the pace of climate protection. In doing so, the German government is relying fully on the EU, as Lukas Scheid reports.
The introduction of a CO2 border adjustment for imported goods (CBAM) is one of the most controversial measures in the Fit for 55 package. Critics doubt that the climate tariff can be implemented in compliance with WTO regulations, fear trade conflicts with partner countries, and a high risk of carbon leakage due to the discontinuation of the free allocation of emission rights. If the demands of the CBAM rapporteur in the EU Parliament are anything to go by, this should be phased out even earlier than envisaged by the Commission. Environmentalists welcome the proposals, but there is an outcry among industry associations. Timo Landenberger has the details.
On Tuesday, Minister for Economic Affairs and Climate Action Robert Habeck took a look in the rear-view mirror “perhaps for the last time,” as he himself put it. At the presentation of the opening balance sheet of climate protection, he outlined the current backlog in efforts to reduce emissions in energy supply, industry, the building sector, and transport. Between 2010 and 2020, CO2 emissions had dropped by 15 million tons a year. This is not enough, after all, a reduction of 36 to 41 million metric tons per year is needed by 2030 to achieve the climate protection targets, Habeck said.
The Vice-Chancellor also said that the expansion of renewable energies has so far proceeded too slowly. It took 30 years to achieve a share of renewables in gross electricity consumption of around 40 percent. However, by the end of the current decade, Germany wants to be at 80 percent – measured against the significantly higher expected electricity demand in 2030.
However, Habeck’s assessment is not just a reckoning with the climate policy of the past decades but rather reflects the scale of the tasks ahead in this legislative term. It indicates the direction of two packages of measures that are to come at Easter and in summer to complete all legislative and review bodies, such as necessary notifications at the EU level, in time before the end of the year. Both packages of measures are expected to come into force as early as 2023.
In it, he wants to triple the pace of climate protection and does not rule out adjustments to the German Climate Change Act. But the German government is also counting on the rapid implementation of the Green Deal. The measures of the Fit for 55 package are intended to make fossil fuels uneconomical through high CO2 prices. The 37-page report by the Federal Ministry for Economic Affairs and Climate Action (BMWi), therefore, calls for an ambitious reform of the ETS. In principle, Germany could play a key role in the Fit-for-55 dossier, the paper says.
Habeck also calls for an integrated European power grid. Europe would make faster progress in the energy transition if the grid were better. Everyone would have to make their own contribution. This would also require electricity imports and exports – of which there are not yet enough, he said. However, he is not thinking of French nuclear power or Polish coal-fired power – which will not be needed – but rather of energy partnerships such as the German-Norwegian Nordlink power cable.
Germany is currently a net exporter of electricity, added State Secretary Patrick Graichen. The nuclear phase-out at the end of 2022 is expected to balance the books next year. Despite its climate protection plans, Germany would not be dependent on foreign energy imports.
However, in order to achieve an 80 percent share of renewable energy (about 715 terawatt-hours) by 2030, numerous new plants will have to be added. According to the BMWi, there was even a decline in renewable capacity in 2021. So in order for the expansion to proceed faster, it is to be classified as “in the overriding public interest and public safety.” Thus, areas for solar and wind power plants are to be created more quickly. The 2-percent target for wind power is to apply equally to all German states. However, Habeck did not rule out the possibility that a state that fails to meet its own targets can have the corresponding share compensated by another state.
In the long term, the expansion of renewables should also benefit the industry, which is to be supplied with low-cost green electricity that is exempt from levies. Decarbonization is considered one of the biggest challenges. Compared with the COVID-19 crisis year of 2020, 30 million more tons of process-related emissions were expected to be emitted in 2021.
The expansion is to be flanked by a revised hydrogen strategy and additional subsidy programs so that emissions-intensive industries, in particular, can produce with green hydrogen in the future. By 2030, 10 gigawatts of electrolyzers are to be added, the import of hydrogen is to be expanded, and the network infrastructure is to be built up for a “reliable and efficient supply overall,” it says. So-called hydrogen IPCEIs (Important Projects of Common European Interest) and carbon contracts for difference are also to help with rapid implementation.
Following the phase-out of nuclear power and coal, green hydrogen should also enable the phase-out of gas in a third step. However, for this to happen, the “secured capacity needed to maintain security of supply” must be available, and the end of natural gas use must be “widely accepted by society and legally secure in regulatory terms,” it says. The electricity market design is also to be adjusted accordingly. A newly created “climate-neutral electricity design” platform is to discuss what the adjustments might look like.
The expansion of renewables and the abolition of the EEG surcharge from 2023 are also intended to ease the burden on private households. Heating costs are to fall, energy efficiency is to be increased, and 50 percent of thermal energy is to be produced climate-neutral by 2030. The German government wants to anchor these goals in a new “Climate Neutrality Building Strategy”. The Federal Ministry for Economic Affairs and Climate Action also wants to revise the Building Energy Act together with the newly established Federal Ministry of the Interior, Building and Community under Social Democrat Klara Geywitz in order to bring new buildings and renovations into line with the climate targets.
The transport sector is also considered particularly difficult to decarbonize. With advancing electrification and energy supply from renewables, the German government plans to reduce emissions to 85 million metric tons in 2030. Compared to 2019, that would be half. The target of 15 million EVs by 2030 set out in the coalition agreement is to be accompanied by the expansion of the charging infrastructure – one million charging stations by 2030. From 2025, this would require 100,000 charging stations to be added annually to those already in place or planned.
In addition, vehicles that can demonstrably be fueled exclusively with e-fuels should be able to be registered even after the discussed phase-out of internal combustion engines. However, this would require e-fuels to be taken into account in the EU’s CO2 limits. The Commission had not provided for such an exception in its proposal, and e-fuels were also not included in the draft report by rapporteur Jan Huitema.
The Fit for 55 climate package is visibly taking shape. The majority of the measures are to be adopted before the end of this year. This is an ambitious goal, given the complexity of the negotiations on the plans, some of which are highly controversial.
A foretaste is provided by the planned CO2 limit compensation for imports (CBAM), which had already caused quite a bit of controversy in recent months. Last week, the EU Parliament’s rapporteur, Mohammed Chahim (S&D), presented his draft – and fueled the debate with his partly far-reaching amendment proposals.
Accordingly, Chahim wants to introduce the CBAM more quickly than envisaged by the Commission and shorten the planned transition phase from three years to two. In addition, Chahim calls for the allocation of allowances to be reduced to 90 percent as early as 2025, to 70 percent in 2026, and to 40 percent in 2027. By the end of 2028, the allocation of free certificates is to be phased out completely – and thus seven years earlier than planned by the Commission.
The industry reacts appalled to the demands. The Wirtschaftsvereinigung Stahl (German Steel Industry Association), for example, criticizes that the down melting of free emission allowances already means a considerable additional burden per se for companies in the transformation, which massively complicates the switch to low-CO2 processes. “If there were to be no more free allocation as early as 2028, this situation threatens to get even worse,” WV Stahl President Juergen Kerkhoff tells Europe.Table. “In order to avoid experiments at the expense of the steel industry’s competitiveness, new instruments should be extensively tested, and already established and target-oriented paths for carbon leakage protection should be maintained during this period.”
The German Chemical Industry Association (VCI) is also opposed: “This would place an additional burden on chemical customers in the EU’s internal market and also significantly impair our export opportunities on the global market, as exports from the EU would be burdened with higher climate protection costs that our global competitors do not have,” says Joerg Rothermel, Head of Department Energy, Climate Protection and Raw Materials. Ultimately, the CBAM does not yet provide a solution for exports.
According to the VCI, many additional steps would be necessary, for which there is no concrete design yet. These would include emissions reporting by foreign plants, processing at the border by customs, and verification of the information. If the introduction is rushed, there is also a great risk that importers could circumvent the CBAM requirements and thus no longer have any protection on the European market.
Peter Liese, environmental policy spokesman for the German CDU/CSU in the EU Parliament, calls Chahim’s assumption, that the CBAM can function this quickly without any problems, “naive”. The Commission’s more cautious approach is more sensible here: “The bottom line is that I see a great risk of carbon leakage if the plans are implemented as they are,” Liese says. However, Chahim had assured him several times that he saw his proposals only as a starting point for discussion. “That’s why I’m very optimistic that we’ll be able to steer him away from his overambitious plans in the course of the negotiations.”
However, the CDU MEP fears that protection against carbon leakage will be undermined even if the Commission proposal is adopted unchanged. Liese is the EU Parliament’s rapporteur for the revision of the Emissions Trading Scheme (ETS), which is closely linked to the CBAM. The CDU MEP plans to present his draft report on Friday.
However, Liese has already announced his intention to include some kind of CBAM hedge in the ETS: Accordingly, emission allowances that are no longer issued free of charge to the industry as a result of the introduction of CBAM should not be canceled but set aside as a reserve for one year. “In the event that the CBAM does not function or does not function sufficiently, these certificates could be distributed to the affected companies to prevent carbon leakage,” explains Liese.
For the environmental organization Germanwatch, on the other hand, a faster end to the free allocations is an important step forward. “Only the full auctioning of CO2 certificates will give companies sufficient incentive to convert their production to climate-friendly methods,” says Anne Glaeser, Policy Advisor Carbon Pricing at Germanwatch. A longer transition period carries the risk that European heavy industry will miss the transformation.
Michael Bloss, the environmental policy spokesman for the Greens in Brussels and ETS shadow rapporteur, is also convinced: “The instrument will not get better by waiting longer.” An earlier date of introduction is therefore conceivable.
In his draft report, Mohammed Chahim also calls for the extension of the CBAMs scope to include organic chemicals, hydrogen, and polymers. Unthinkable for the VCI: “We plead for the chemical industry to be completely exempted from CBAM, at least in the first phase. Under no circumstances should there be an extension to large parts of the chemical industry, as proposed by the rapporteur. That would significantly increase the problems for our industry,” Rothermel said.
And WV Stahl is also skeptical, especially about the expansion to hydrogen. “In order to meet the high demand, the industry will also have to rely on imports. Overly strict regulation must not prevent the supply of hydrogen and thus slow down the transformation,” says Kerkhoff.
However, hydrogen would only be affected by the CBAM if it is produced using fossil fuels. “Including H2 in the CBAM is, in my opinion, a signal to trading partners to focus on green hydrogen in order to avoid a CO2 cap-and-trade tax,” says Susanne Droege, CBAM expert at Stiftung Wissenschaft und Politik. (For an interview with Susanne Dröge, see tomorrow’s issue of Europe.Table).
The question of how the revenues from border adjustment are to be used and how the green transformation of poorer trading partners is to be supported is also causing controversy. According to the draft report, only the least developed countries, i.e., the economically poorest countries in the world, are to be supported. For Michael Bloss, this is a step in the right direction: “The instrument should serve the green transformation and not be a new tool to boost the budgets of industrialized countries in Europe.”
A large part of the revenue from the border adjustment is nevertheless to flow into the EU budget and the administration of the CBAM. According to Germanwatch, this is the wrong signal. Instead, the majority of the revenue, as well as other funding, should flow to middle- and low-income partner countries, it says. “This is crucial to get the instrument out of the confrontational-protectionist corner and into a more cooperative tool,” says Anne Glaeser of Germanwatch.
Among the countries most affected by the CO2 border adjustment are Ukraine and Turkey. The proposal does not provide any support for them. However, the EU should “support the industries of the countries particularly impacted by the CO2 limit offset on the path towards climate neutrality,” says Glaeser.
The CBAM does not bring in enough money to refinance decarbonization abroad, Droege counters. Countries like Turkey or Ukraine could raise the money themselves “by introducing a CO2 price or increasing the existing one, which they can then offset against the CBAM.” Least developed countries cannot do this so easily because their governments usually lack governance.
He declared a climate emergency, pushed the Green Deal, and backed the multibillion-dollar COVID Recovery Fund to pull the EU out of the crisis. But David Sassoli, the president of the European Parliament, will not live to see the long-term results of his work.
On Tuesday morning, Sassoli died in Aviano, northern Italy – a week before the end of his two-and-a-half-year term. The 65-year-old had been hospitalized at Christmas; he died of an immune system disorder, according to official reports.
Sassoli, who belonged to the Partito Democratico, had led the Parliament since 2019. His term would have ended at the end of this month because the Social Democrats and the conservative EPP family of parties share the five-year legislative term in the presidency. Already in fall, Sassoli had fallen ill with severe pneumonia.
News of the death of the popular but little-known politician outside Italy has caused consternation far beyond Brussels. “Sassoli was a symbol of balance, humanity, and generosity,” Italy’s Prime Minister Mario Draghi said in Rome.
“Today is a sad day for Europe,” said EU Commission President Ursula von der Leyen. The EU is losing a “passionate European, a convinced democrat, and a good person,” the CDU politician said. Sassoli’s smile will be missed.
However, relations between the two EU leaders have been rather frosty of late. Because von der Leyen is not taking enough action against violations of the rule of law in Hungary and Poland, the Parliament has initiated an action for failure to act before the European Court of Justice – a first.
Even the beginning of the cooperation, which was marked by the climate crisis and the COVID-19 pandemic, was not easy. Sassoli, who won a third mandate in the 2019 European elections, saw himself as an adversary of the Commission president, who had been appointed by the Council. “I was not on the list of EU leaders, I am not a product of the Council,” Sassoli said in an interview with “Politico”. Unlike von der Leyen, he said, he emerged from a democratic process. However, his election in 2019 was a surprise even for insiders.
Sergei Stanishev, President of the Party of European Socialists (PES), was considered the favorite. Hardly anyone had Sassoli on their radar. But the political science graduate, who later worked as a journalist and anchorman on Italian television, prevailed.
As a committed Catholic, he was also electable to conservatives. His authoritative style made him an ideal compromise candidate. Sassoli was also appreciated for his rhetorical talent. His inaugural speech was a flaming appeal against nationalism.
Unlike his German predecessor Martin Schulz (SPD), however, Sassoli was hardly able to set his own accents. This was due to the superiority of the Council, which more than ever determines EU business, – but also to the COVID pandemic, which massively hinders the work of the European Parliament.
In recent months, Sassoli has increasingly lost control of Parliament. He toyed with the idea of running for a second term to make up for lost time, but his plans were thwarted, not least by his own comrades. The Social Democrats got involved in the usual dealings with the EPP in Parliament and put together a new personnel package for the second half of the legislative term, which begins in February.
Accordingly, the arch-conservative EPP politician Roberta Metsola from Malta is to take over the leadership of the European Parliament. She already took up her new post on Tuesday in an executive capacity. In turn, the conservative German Secretary-General Klaus Welle (CDU) could step down.
The final details of the personnel package are to be finalized this week. Metsola’s official election is then scheduled for next week’s plenary session of the European Parliament in Strasbourg. Before that, there is to be a memorial ceremony for Sassoli on Monday. Eric Bonse
