‘Governance’, ‘Effort Sharing’ and ‘Juncker Investment Plan’: European Parliament starts introducing “the shift of financial flows” as required by the Paris Climate Agreement

Financing the transition

In 3 legislative files currently negotiated in Brussels the European Parliament progressed on financing matters: reporting on Fossil Fuel Subsidies phase-out; the linking the EU budget comes to national climate ambitions; a climate impact assessment tool for EU investments; and a 40% climate earmarking target for the Juncker Investment Plan.

What happened recently?

The rapporteurs in the Environment and Energy Committees, Claude Turmes (LU) and Michele Rivasi (FR) published their joint draft report on the Governance regulation on 17 May (SEE Caroline’s FLASH on the topic). Among all other elements the report introduces a provision that would require Member States to plan for and to report on their phasing out of fossil fuel subsidies via their National Energy and Climate Plans. The same report as well calls for the EU budget to play a crucial role in achieving high ambitions of national climate and energy objectives.
The requirement to undertake climate impact assessment of EU funds investments has been put into the European Parliament’s Environment Committee position on the Effort Sharing Regulation 30 May (SEE Caroline’s FLASH on the topic).
Finally, ECON and BUDG committees supported a 40% climate action target for Juncker Investment Plan (European Fund for Strategic Investments – EFSI) for the period 2018-2020, accompanied with guidelines on how to ensure compliance with the Paris Climate Agreement of individual projects as well as the entire EFSI portfolio.

What happens next months?

All 3 files are still to be finalized and adopted in the Parliament and then negotiated with Member States.


By Markus Trilling