Gas subsidies included in EU Recovery Fund

Published by Kayle Crosson on

10 November 2020 

Fossil gas will fall into the scope of the €672.5 billion EU recovery fund and “contradicts the Parliament’s multiple earlier commitments” to end fossil fuel subsidies, according to Europe’s largest climate coalition. 

MEPs from both the Budget and Economic Affairs Committee allowed for its inclusion yesterday as part of the Recovery and Resilience Facility. 

Markus Trilling of CAN Europe said the inclusion of fossil gas shows the European Parliament to be “two-faced on climate action” as the body declared a climate emergency and promotes further climate action but also allows for further fossil fuel subsidies in the EU budget. 

Additionally, within its resolution on a European Green Deal, the European Parliament said it “insists on a rapid phase-out of direct and indirect fossil fuel subsidies by 2020” across the EU and for each of the 27 Member States. 

“If the Parliament wants to merit its climate credits, MEPs will have to exclude all fossil fuels from the entire EU budget, Cohesion Policy, Just Transition and Recovery funding in particular,” Mr Trilling said. 

Last month the European Parliament voted to increase its 2030 target to a 60 per cent emissions reduction, which CAN Europe called a “significant step forward”. 

The Environment Committee of the Parliament shortly afterwards agreed that fossil fuel subsidies should be excluded from the multi-billion euro recovery fund pot in order to fund a clean energy transition, yet both leading Committees created exemptions for certain fossil gas projects yesterday. 

Gas has “no role in a Europe transitioning towards climate neutrality”, Esther Bollendorff of CAN Europe said. 

“Putting public money in fossil gas is like falling in a dangerous, dirty and expensive pipe-trap,” she warned. 

Gas & Just Transition Fund 

The bloc’s Just Transition Fund also has allowances for fossil gas subsidies, and CAN Europe warned in September that the move would lock-in polluting emissions over the coming decades. 

“Fossil gas is an economic dead-end in this time of economic crisis, as renewables and building renovation provide three times more jobs than any fossil fuel,” Mr Trilling said at the time. 

The vote was a triple loss for people, the economy, and the climate, he added. 

The climate impact of gas 

While it has a lower carbon dioxide output than other fossil fuels, the production of gas presents multiple climate issues. 

Methane leaks throughout the supply chain, a greenhouse gas which is estimated to have a warming effect 84 to 87 times greater than that of carbon dioxide over a 20 year period. 

In order to maintain a 66 per cent chance of limiting global warming to 1.5 C, the use of gas must fall by 20 to 25 per cent in 2030 relative to 2010 levels, and by mid-century it must further decline by 53 per cent to 74 per cent. 

However, despite this warning, the global economy was on course to produce 70 per cent more gas by the end of the decade that would be consistent with a 1.5 C warming scenario, according to a report by the UN Environmental Programme and several NGOs. 

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