MEPs voted in favour of extending the Effort Sharing Regulation (ESR) beyond 2030 on Wednesday (8 June) when they adopted by a large majority (437 votes in favour, 142 against and 40 abstentions) the draft report by Jessica Polfjärd (EPP, Sweden).
Adopted in 2018, the ESR sets national targets for the reduction of greenhouse gas (GHG) emissions by 2030 that are not covered by the EU Emissions Trading System (ETS) or the Land Use, Land Use Change and Forestry Regulation (LULUCF).
These emissions are mainly from road transport, heating of buildings, agriculture, small industrial installations, and waste management.
In its proposal for a revision of the ESR, presented on 14 July 2021 (see EUROPE 12762/2), the European Commission plans to increase the national targets set out in the Regulation so that each Member State will contribute to the reduction of the EU's net GHG emissions by at least 55% by 2030 (compared to 1990 levels).
The proposed new targets range from a 10% reduction in emissions (Bulgaria) to a 50% reduction (Finland, Luxembourg, Germany, Denmark, Sweden).
While the Parliament has decided not to change these national contributions, it wants to extend the regulation beyond 2030.
In concrete terms, the Commission would be required to present, by the day of the adoption of the EU’s 2040 climate target, a report setting out an emission reduction pathway covered by the ESR for each Member State. These trajectories should be “consistent with the objective of climate neutrality for each Member State by 2050 at the latest”.
Less flexibility for Member States
Under the current ESR, annual emission allowances are set for each Member State and are progressively reduced until 2030 in order for countries to reach their target.
However, the regulation does include flexibilities to set aside allowances in years when emissions are below their annual emissions quota for use in subsequent years, or to transfer allowances from one Member State to another.
These flexibilities include the ‘safety reserve’ - corresponding to a maximum of 105 million tonnes of CO2 equivalent - which allows an additional quantity of allowances to be allocated to a Member State with a deficit. However, it can only be used by Member States with a low GDP per capita that are failing to meet their emission reduction targets.
The Parliament, on the other hand, voted in favour of deleting this reserve, while rejecting the Commission’s proposal to introduce an additional safety reserve.
In addition, while the European Commission proposes that a Member State may “borrow” up to 10% of its annual emissions allowance for the following year during the period 2021 to 2025 and up to 5% for the years 2026 to 2029, the negotiators want to limit this rate to 5% over the whole period (2021 to 2029). The same applies to the ability of a Member State to transfer allowances to other Member States.
The Parliament also asks the Commission to come forward with one or more EU-wide non-CO2 emission reduction targets by July 2023.
It also calls for more attention to be paid to emissions from biomass combustion plants to ensure that the use of so-called “sustainable” fuels does not lead to higher emissions than fossil fuels. (Original version in French by Damien Genicot)