Taxonomy Fight Moves to Court as EP Cannot Resist Gas and Nuclear

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    Stockholm (NordSIP) – Since its adoption into law in the middle of June 2020, the EU Taxonomy on sustainable investments has been marred by controversy on account of the details of its implementation and greenwashing fears.

    Although the role of nuclear energy and natural gas has been a concern from the start of the legislative process, its inclusion into the Delegated Act governing the details of the taxonomy proposed by the European Commission has brought the issue to the fore. Following the European Parliament’s inability to stop the sectors from diluting the Taxonomy Green Peace is now gearing up for a legal battle on the topic.

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    Pushing Nuclear and Gas

    The role of nuclear power and natural gas came to the fore of the public policy debateafter the European Commission launched a consultation on their inclusion into the Taxonomy at the start of 2022. The inclusion of these two sectors immediately incited criticism and outrage from investors and specialists alike as a clear case of watering down a policy proposal.

    Despite these concerns, the European Commission persisted and pushed the issue through the EU’s legislative process. According to Commission’s proposal certain fossil gas and nuclear energy activities would be classified as transitional activities contributing to climate change mitigation in a time-limited fashion, dependent on specific conditions and transparency requirements. In response, members of the European Parliament (EP) attempted to stop these efforts at the Committee level.

    On 14 June, two of the European Parliament’s lead committees, the Economic and Monetary Affairs Committee and the Environment, Public Health and Food Safety Committee, issued a joint objection to include specific nuclear and gas energy activities in the list of environmentally sustainable economic activities covered by the EU Taxonomy. Seventy-six Members of the European Parliament (MEPs) voted against labelling nuclear and gas green, with sixty-two supporting the Commission’s proposal and four abstaining.

    Not Enough Votes to Stop

    However, these efforts seem to have largely failed to galvanise the opposition necessary to stop the proposal. Now, a majority of the MEPs voted against an objection that the two sectors’ should be included into the Taxonomy. An absolute majority of 353 MEPs was needed for Parliament to endorse a measure vetoing the Commission’s proposal on July 7th, 2022. However, 328 voted against the resolution, 278 MEPs voted in favour and 33 abstained. Members of all parties voted both and against the measure but the vote’s headcount suggests the Commission’s view seems to have the most support from the right-wing parties in the EP.

    In the absence of the necessary majority, the European Parliament was not able to object to the Commission’s Taxonomy Delegated Act to include specific nuclear and gas energy activities, under certain conditions, in the list of environmentally sustainable economic activities covered by the EU Taxonomy.

    Greenpeace To Take Legal Action

    In response, Greenpeace announced it will take legal action against the European Commission. “It’s dirty politics and it’s an outrageous outcome to label gas and nuclear as green and keep more money flowing to Putin’s war chest, but now we will fight this in the courts,” Greenpeace EU sustainable finance campaigner Ariadna Rodrigo said.

    “The EU Commission’s shameful backroom dealing on behalf of the fossil fuel and nuclear industries won’t help them there. We’re inspired by the climate activists here in Strasbourg this week and are confident that the courts will strike down this politically motivated greenwashing as clearly in breach of EU law,” Rodrigo added.

    Next Steps

    Before the lawsuit can take place, Greenpeace will submit a formal request for internal review to the Commission. Once this is finished and if its result is negative, Greenpeace will submit its suit to the European Court of Justice.

    If neither Parliament, nor Council object to the proposal by 11 July 2022, the Taxonomy Delegated Act will enter into force and apply as of 1 January 2023.

    Image courtesy of Greenpeace
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