EK for EU 2040 climate target to boost green economy

The Confederation of Finnish Industries (EK) demanded that the European Union must maintain climate leadership through an ambitious 2040 climate target and enhance the competitiveness of the green economy.

The EK on Monday unveiled its climate position together with other Nordic business organisations, where it said that a well-functioning climate regulation framework is vital for Finland and the EU in order to attract green investments, said EK in a press release.

Finnish Industries believe that a successful green transition calls for the climate measures to be executed in the most cost-effective and technology-neutral way possible.

Therefore, the EU should set only one binding climate target for 2040, which would be a net reduction in greenhouse gas emissions.

As a minimum, the 2040 target should follow the average trajectory between 2030 and climate neutrality in 2050 or have even higher ambition depending on the functionality of the whole framework and measures.

“It is in the interests of both the climate and European companies that the EU continues to pursue ambitious climate policies and achieves the 2050 carbon neutrality target. At the same time, in times of recession, it is crucial to ensure that the green transition strengthens the EU’s economic growth and international competitiveness,” said Jyri Häkämies, Director General of EK.

He said that mitigating climate change must be seen as a driver of economic growth in the EU.

In addition to this, Europe must become the leading solution provider, helping countries around the world to succeed in the energy transition, said the EK Director General, adding that Finland and other Nordic countries must be at the forefront of this export activity.

“The EU’s climate policy and its concrete tools have a significant impact on our ability to attract green investments. In Finland, the value of current green investment plans exceeds 200 billion euros. Now, we need business-friendly EU legislation to ensure that these early-stage plans will actually proceed and materialise. Achieving climate targets also requires smart competition policy in the EU and a level playing field for the companies in the Single Market,” he said.

In the EU, preparations are underway for the next phase of climate policy. The Commission will present its communication with a proposal for the EU’s new climate target for 2040 next February. This will also offer an opportunity to renew the key tools and principles of EU energy and climate policy for the period 2030–2040.

EK’s proposals for reforming EU climate policy for 2030–2040:

Only one binding climate target for the EU by 2040: a net reduction in greenhouse gas emissions covering both emission reductions and carbon removals. As a minimum, the 2040 target should follow the average trajectory between 2030 and climate neutrality in 2050 or have even higher ambition depending on the functionality of the whole framework and measures. Large-scale electrification is essential for the decarbonisation of society. Therefore, nuclear power should be treated as a low-carbon energy source alongside renewable energy.

EU regulations should enable the adoption of all new climate technologies, such as technical removals and sinks, (carbon capture, storage and reuse of carbon).

The green transition will significantly increase the use of clean electricity. Therefore, the EU’s energy consumption reduction target should focus only on fossil energy, or it should be converted to promote energy efficiency in a better way.

Voluntary energy efficiency agreements between companies and the ministry have delivered excellent results in Finland for over 20 years, and the EU should allow this flexible tool to continue beyond 2030.