Following an initial draft compromise presented on 25 October (see EUROPE 13739/4), the Member States’ ambassadors to the European Union continued discussions on Friday 31 October on the revision of the ‘European Climate Law’, on the basis of a new proposal from the Danish Presidency of the Council, with a view to a ‘general approach’ at the extraordinary ‘Environment’ Council on 4 November.
According to a Danish spokesman, the Presidency believes it is close to “a deal”, although it is “aware that we are now walking on a knife edge”.
The debate centred on the strengthening of the revision clause, which now includes the explicit possibility of re-examining the target of reducing emissions by 90% by 2040.
This wording follows the conclusions of the European Council (see EUROPE 13737/3) and responds to the request of several Member States to ensure a more “realistic” approach to monitoring the climate trajectory.
A number of delegations felt that the Presidency had struck a satisfactory balance, while others expressed their reservations, fearing uncertainty for economic players and investors, and some called for a stricter framework for this revaluation.
“Emergency brake”. This development is partly in line with France’s position, which advocates in a - “broadly supported” - open note for a “risk reduction” mechanism, combining a more precise revision clause between now and 2030 and an “emergency brake” enabling, if necessary, the net reduction target to be adjusted by up to three points (i.e. to -87%), should carbon absorption prove to be lower than currently projected.
This would be more a precautionary measure than a change of direction. And with good reason: it would only apply in the event of a proven shortfall in carbon sinks, would preserve the stability of the regulatory framework and would not create uncertainty for investors, particularly as regards the price of carbon.
International carbon credits. The Presidency’s updated text maintains the possibility of an “adequate contribution” of these credits to the overall objective, replacing the term “limited” used in the previous version. The 3% level proposed by the European Commission remains in square brackets, as does the implementation date (2036).
Some Member States have supported an increase to 5% of these credits provided for in Article 6 of the Paris Agreement, which would allow European efforts to include the financing of decarbonisation projects abroad and implementation from 2031, but the decision will have to be taken by the ministers.
A new compromise, with slight modifications, should be presented before the EU Council to allow ministers to concentrate on the main political decisions.
NDC. With regard to the updating of the Nationally Determined Contribution (NDC), which was also on the agenda, the Member States agreed that the adoption of the NDC would depend directly on the agreement on the ‘Climate Law’. Several delegations insisted that the intermediate trajectory to 2035 should flow directly from the 2040 target.
The compromise proposal: https://aeur.eu/f/j8y
The French note: https://aeur.eu/f/j8z (Original version in French by Nithya Paquiry)