Europe must seize its chance to become the world leader in clean technologies – EURACTIV.com
EU member states are not sufficiently involved in the regulations and funding that will promote clean technologies. necessary to achieve its climate ambitions. Now is the time to change course, argue Peter Sweatman and Thomas Pellerin-Carlin.
Peter Sweatman is the CEO of Climate Strategy & Partners, a leading climate consulting firm based in Madrid. Thomas Pellerin-Carlin is the director of the Jacques Delors Energy Center at the Paris-based Think Tank Jacques Delors Institute.
Economic ministers from across the European Union are meeting tomorrow in Luxembourg. Against the backdrop of sharply rising energy prices, they will discuss the implementation of the stimulus packages that each member state recently submitted as part of NextGenerationEU, the unique 807 billion COVID-19 stimulus package. euros.
Ministers will see whether these plans enable a green economic recovery on the ground and whether they are indeed able to advance innovation so that Europe continues to lead the way in the global climate and energy transition.
Unfortunately, when it comes to funding climate-related research and innovation, Europe continues to hedge its bets. Too often, too much public money ends up in the hands of established business interests and investments that harm the environment, and not enough public money is spent on climate research and innovation.
Look no further than the EU’s green taxonomy on sustainable finance – whose ‘do no harm’ teeth should inform all public investments. The classification system for green financial products is designed to phase out investments that harm the environment and, instead, increase green investments. Corn Fossil gas and nuclear interests attack taxonomy, and loopholes would undermine the kinds of investments we need to reduce our emissions at the pace and scale needed to reach a goal of net zero by 2050.
Now is the time to ask: are the allocation and public procurement mechanisms in the EU and all of its Member States really ’55-fit’? And do they support the package of legislative proposals designed to reduce carbon emissions in the bloc by 55% from 1990 levels by 2030?
Or will the status quo prevail, with stimulus funds failing to reach truly bold and innovative government programs? Leaving aside the small and medium-sized enterprises whose ingenuity is so crucial to any healthy R&D ecosystem.
Extraordinarily, between 2010 and 2018, EU-27 public investment in clean energy R&D declined, while US investment in clean energy increased by more than 25% and Chinese investment nearly tripled. . US President Biden and Chinese President Xi clearly understand the value of public investment in advanced technology.
How many of us have experienced lockdowns thanks to Chinese hardware and American software? Europe must learn the lessons from the failure of its digital strategy two decades ago and quickly improve its climate strategy today.
Fortunately, encouraging signs are emerging. According to Cleantech for Europe, in the second quarter of this year, some of Europe’s most promising and innovative cleantech start-ups raised 5.4 billion euros, a record.
But there is still a lot to do. To fill the gaps in the EU’s current Fit-for-55 legislative package, as well as the gaps in its stimulus and massive investment plan, we need to build on the momentum generated by start-ups. ups, innovation funders, and support our European cleantech industry with more public support, too.
Here’s what needs to happen:
- Follow the call of European Council President Charles Michel for adequate financial support for research, innovation and deployment by increasing the EU’s 2022 annual budget for climate R&I. At the moment, the Council wants to ax Horizon Europe’s budget, cutting it by more than € 300 million, including a € 50 million cut from the European Innovation Council, which is essential to helping young cleantech companies take off. Working against the EU’s stated will to fund R&I is doomed to failure.
- Explore how EU Member States plan to support climate-related R&I in their green recovery. New research from the Jacques Delors Institute shows how member states provided adequate funding for hydrogen in their stimulus packages, but failed to do the same for other equally important clean technologies. Beyond the stimulus, member states must adopt multi-annual cleantech investment plans to boost the research, development, demonstration and deployment needed to achieve climate neutrality by 2050.
- Ensure that the EU Innovation Fund carries out the necessary climate demonstration projects. The International Energy Agency predicts that governments must invest $ 90 billion by 2030 to build a global portfolio of clean technology demonstration projects. If we assume that the EU’s share is around one-third ($ 30 billion), let’s make sure that the Innovation Fund receives enough EU ETS allocations to properly fund the lion’s share of demonstration projects. clean technology we need.
- Ensure that the EU taxonomy can identify and stimulate all technologies that enable the EU’s climate transition. These should include enabling technologies hidden in software, supply chains and new materials, which are just components of green industrial sectors that make a significant contribution to climate change mitigation. And should exclude those that significantly harm environmental goals.
- EU regulations must support the creation and deployment of clean energy innovations. This should enable Europe to become the world leader in crucial clean technologies such as carbon-negative cement, lithium-ion solid-state batteries and floating offshore wind power. It doesn’t mean tiptoeing around the regulations; this means adopting very ambitious climate regulations that boldly set a clear direction, such as new 100% renewable boilers by 2025, 100% zero emission vehicles by 2035 and economy-wide climate neutrality by 2050.
With a challenge as big and as urgent as climate change, we don’t have time for a second chance. This is especially true when it comes to public funding and political support for the development and commercialization of next generation clean technologies. We need to get it now and own our own future.