E.U. Adopts 2040 Climate Target

Summary

The European Union has set a tar­get for mem­ber states to reduce green­house gas emis­sions by 90 per­cent com­pared to 1990 lev­els by 2040, with most cuts required to come from domes­tic sources. The use of inter­na­tional car­bon cred­its is lim­ited in achiev­ing this goal, as some ques­tion the effec­tive­ness of off­set projects in deliv­er­ing real emis­sions reduc­tions.

European Union mem­ber states have com­mit­ted to a stricter time­line for cut­ting green­house gas emis­sions. Following a vote by the E.U. Council, an amend­ment to the bloc’s cli­mate reg­u­la­tion now applies across all 27 mem­ber states, requir­ing emis­sions to fall 90 per­cent by 2040 com­pared with 1990 lev­els.

According to the European Environment Agency, emis­sions in 1990 totaled about 4,726 mil­lion tonnes of CO2-equiv­a­lent, a met­ric that com­pares the warm­ing impact of dif­fer­ent green­house gases rel­a­tive to car­bon diox­ide, the most preva­lent.

For com­par­i­son, the Center for Climate and Energy Solutions esti­mates that U.S. emis­sions in 1990 were about 6,140 mil­lion tons of CO2-equiv­a­lent, nearly twice China’s out­put at the time and more than five times India’s.

Since 1990, E.U. emis­sions have declined to about 3,000 mil­lion tons by 2025, accord­ing to the fig­ures cited in the plan. By com­par­i­son, annual emis­sions were esti­mated at 5,000 to 6,000 mil­lion tons in the United States, 13,000 to 14,000 mil­lion tons in China and 3,400 mil­lion tons in India. If fully imple­mented, the new E.U. tar­get would reduce the bloc’s emis­sions to roughly 470 – 480 mil­lion tons of CO2-equiv­a­lent by 2040.

The 2040 tar­get is intended as an inter­me­di­ate step between the 55 per­cent reduc­tion goal for 2030 and the net-zero tar­get set for 2050.

Under the agree­ment, most of the emis­sions cuts needed to reach the 2040 goal will have to take place within the European Union itself. At least 85 per­cent of the 90 per­cent reduc­tion must come from domes­tic cuts across the econ­omy, includ­ing energy, indus­try, trans­port and build­ings. Agriculture and land use are also iden­ti­fied as key areas for inter­ven­tion.

One of the most con­tentious ele­ments of the deci­sion, and the sub­ject of lengthy debate, is the lim­ited role allowed for inter­na­tional car­bon cred­its. Up to five per­cent­age points of the total reduc­tion may be achieved by pur­chas­ing high-qual­ity cred­its gen­er­ated by cer­ti­fied emis­sions-reduc­tion or car­bon-removal projects in part­ner coun­tries out­side the European Union.

A car­bon credit is a trad­able cer­tifi­cate rep­re­sent­ing the reduc­tion or removal of one met­ric tonne of CO2-equiv­a­lent. Credits are gen­er­ated by projects that avoid emis­sions or cap­ture car­bon, such as renew­able energy instal­la­tions, for­est pro­tec­tion or soil car­bon seques­tra­tion. Governments and com­pa­nies can buy those cred­its and count them toward their cli­mate tar­gets.

In agri­cul­ture, the debate is espe­cially rel­e­vant for crops and land­scapes that can store car­bon in soils and veg­e­ta­tion.

A lim­ited num­ber of ini­tia­tives have launched car­bon credit mar­kets in the olive oil sec­tor, while the International Olive Council is work­ing on a spe­cial­ized project to reward sus­tain­able land man­age­ment. Research is also con­tin­u­ing into the poten­tial of olive groves as car­bon sinks for such mar­kets.

For agri­cul­ture and the use of soils as car­bon sinks, the European Union is devel­op­ing a car­bon farm­ing frame­work. It is expected to iden­tify agri­cul­tural prac­tices that increase the capac­ity of soils and veg­e­ta­tion to absorb CO2, includ­ing olive orchard man­age­ment. Those prac­tices are expected to play an impor­tant role in deter­min­ing which farm­ing activ­i­ties can gen­er­ate cer­ti­fied car­bon cred­its.

Part of the debate stems from sci­en­tific research ques­tion­ing whether many off­set projects actu­ally deliver the emis­sions reduc­tions they claim.

One recur­ring issue is ​“addi­tion­al­ity,” the prin­ci­ple that a project should gen­er­ate cred­its only if the emis­sions reduc­tions would not have hap­pened any­way. Because the base­line sce­nario is hypo­thet­i­cal, researchers say it is often dif­fi­cult to ver­ify whether a project pro­duces gen­uine addi­tional cli­mate ben­e­fits, leav­ing room for inflated esti­mates of avoided emis­sions.

Several empir­i­cal stud­ies have also raised doubts about the over­all effec­tive­ness of the off­set mar­ket. One analy­sis of cor­po­rate car­bon credit pur­chases found that 87 per­cent of the off­sets used by com­pa­nies car­ried a high risk of fail­ing to deliver real and addi­tional emis­sions reduc­tions.

Other research has reached sim­i­lar con­clu­sions for spe­cific types of projects. Academic stud­ies exam­in­ing for­est and land-use off­sets have found that only a small share of cred­its cor­re­spond to mea­sur­able emis­sions cuts, with some analy­ses esti­mat­ing that fewer than 16 per­cent of issued cred­its pro­vide real cli­mate ben­e­fits.

Because of those con­cerns, sci­en­tists and pol­icy ana­lysts increas­ingly argue that car­bon cred­its should play only a lim­ited role in cli­mate pol­icy, with deep domes­tic emis­sions cuts remain­ing the most reli­able path to reduc­ing green­house gases.

“The European Union remains com­mit­ted to lead­ing the global fight against cli­mate change while pro­tect­ing our com­pet­i­tive­ness and ensur­ing no one is left behind. Today’s adop­tion of the land­mark 2040 cli­mate tar­get will give indus­try, cit­i­zens and investors the reas­sur­ance they need for the clean tran­si­tion in the decade ahead,” said Maria Panayiotou, Cyprus’ min­is­ter of agri­cul­ture, rural devel­op­ment and envi­ron­ment, whose coun­try cur­rently holds the rotat­ing pres­i­dency of the Council of the European Union.