The forthcoming EU budget post-2020 must serve higher climate ambition both in Europe and worldwide, catalyzing the zero-carbon transition of our societies, including the phasing out of fossil fuels towards 100% renewables and fully energy efficient economies.
The EU’s long-term budget, the so called Multiannual Financial Framework (MFF), currently defines the EU’s spending priorities over a seven-year period. The preparations for the next EU budget post-2020 are underway with the European Commission expected to publish its proposal for the post-2020 MFF by the end of 2017.
KEY POLITICAL DEMANDS
1. Make the EU budget compatible with the Paris Agreement
- Shift the EU budget’s financial flows towards a 1.5°C scenario (Paris Agreement, Article 2) and increase the EU’s climate ambitions in light of the Paris Agreement’s long-term objectives;
- Dedicate 40% of the future EU budget to climate action;
- Increase Project Development Assistance for clean energy projects including capacity-building for beneficiaries; Climate proof the entire budget by: conducting climate impact assessments of the various budget lines in view of the EU’s commitment to decarbonise; improving the applied climate action tracking methodology; introducing mandatory ex-ante climate compatibility checks of programmes and projects and regular monitoring and reporting on how the EU budget is contributing to the EU’s decarbonisation commitment;
- Establish via National Energy and Climate Plans (NECP) a direct link between the level of the national climate ambition put forward to achieve the Paris Agreement and the respective level of EU funding;
- Create a performance reserve which incentivises increased climate and clean energy commitments in the national energy and climate plans.
2. Finance clean energy only
- Apply the Energy Efficiency First principle for all investment plans and programmes;
- Fully exploit the potential of renewable energy, energy efficiency and demand-side management, electricity transmission and storage;
- Exclude any support for fossil fuels, fossil fuel related infrastructure or technology;
- Only support the efficient use of sustainable biomass conditioned to stringent sustainability criteria.
3. Improve climate action funding in forestry, agriculture, transport and industry
- Boost climate change mitigation and adaptation in forestry and in the reform of the Common Agricultural Policy to ensure that farming practices are genuinely contributing to resilient ecosystems and sustainable management of natural resources and to climate action;
- Prioritise transport investment that increases electric mobility and phases out support for airports. To justify transport funding, all applications for funding should be shown to decrease CO2 emissions;
- Support research, development and implementation of low-carbon strategies in industry to replace emission-intensive basic materials processes, e.g. for industrial gases, cement, steel or chemical production.
4. Strengthen resilience to climate change
- Support the revised EU Adaptation Strategy so that it reaches the most vulnerable communities, sectors and regions that will suffer the impacts of climate change more severely. For example, poorer and marginalised communities and neighbourhoods, small-scale farmers and fishers, small to medium sized businesses.
- Accelerate the people-centered and Just Transition by: providing tailored financial support to communities and vulnerable households; supporting regions with particular transformation challenges, e.g. mining regions, for developing and implementing long-term strategies for economic diversification towards sustainable economic activities; increasing the role of cities and regions in investment planning for decentralised clean energy solutions;
- Involve stakeholders and partners in planning, monitoring and implementation of EU budget climate action.
5. EU funding outside the EU
- Enable structural reforms and a fair energy transition in the Accession, Neighbourhood, African Caribbean & Pacific (ACP) and other developing country partners in line with the Paris Agreement;
- Foster longer term sustainable development and climate adaptation in third countries in particular through the EU’s Global Climate Change Alliance and regional arrangements e.g. with Africa, including nature-based solutions to climate change.
- Strengthen the monitoring, tracking and reporting of EU funds to third countries, harnessing the principle of delivering transparent public finance to vulnerable communities unequally affected by the interrelated impacts of climate change, poverty and inequality.
6. Greening the Own Resources
- The EU budget’s ‘Own Resources’ should deliver on EU climate policies and address fiscal distortions that favour fossil fuel-powered economies on national level e.g. through a carbon tax implemented in conjunction with the EU Emission Trading System (ETS).