Europe’s Green Unilateralism
The European Union’s unilateral climate strategy will transform Europe into a trade fortress, encourage green protectionism worldwide, and give other regions the opportunity to develop using cheaper energy. And without China, India, and the United States on board, few will want to emulate the EU’s role as a green guinea pig.
MUNICH – The European Union is one of the few signatories to the 2015 Paris climate agreement that initially committed to binding limits on its carbon dioxide emissions, having promised to reduce them by 40% (and now 55%) from 1990 levels by 2030. On July 14, the European Commission presented a comprehensive package of measures aimed at achieving massive reductions in EU firms’ and households’ CO2 emissions in the short term in order to meet the 55% target by 2030 and make the bloc carbon neutral by 2050.
Never before has the world seen a comparable effort to protect the environment. And rarely, except in wartime, have market economies been subjected to the sort of rigid central planning that the Commission now proposes.
The program envisages three different CO2 emissions-trading systems. The Commission plans to expand the existing scheme, which already applies to the energy and chemical sectors and parts of basic industry, to shipping. The EU will also create a new, separate trading system for buildings and road transport. Moreover, emissions certificates will no longer be allocated free of charge. Instead, the EU wants to sell them and use the proceeds to finance transfers to poorer sections of the population, while also sharply reducing the number of certificates each year.