The EU’s Green Deal Faces Setbacks and Backlash

The European Union’s plan to achieve net zero emissions and decarbonize its economy by 2050, known as the Green Deal, has faced delays and opposition from various sectors. The Green Deal, which was once hailed as a landmark initiative, has been watered down or postponed due to concerns from industry, farmers, and companies impacted by Russia’s invasion of Ukraine.

One significant challenge to the EU’s green transition is its dependence on Chinese imports for clean technologies. Brussels recently launched an anti-subsidy probe against Chinese electric car manufacturers, which could further complicate the EU’s commitment to green energy if China retaliates. European diplomats have expressed concern that such antagonistic actions could provoke unintended consequences and retaliation from China.

Moreover, competition from the United States is discouraging investment in Europe’s green tech industry. The US government’s substantial tax credits and subsidies for companies pursuing clean technologies have been praised by investors for prioritizing funding over regulation.

The revision or introduction of over 70 pieces of legislation under the Green Deal has been slow, and critics argue that it has mainly resulted in a series of unattainable targets for member states and companies. While the EU has a comprehensive regulatory framework in place, there is a lack of a compelling business case for transitioning to a greener economy.

As EU elections approach, disagreements over newer proposals have intensified, and a significant proportion of the commission’s original proposals are unlikely to be adopted before the election. Resistance to climate legislation is also growing within member states, with the centre-right European People’s party focusing on reducing the burden of climate regulation in their election messaging.

The challenges faced by the EU in implementing its environmental agenda are not entirely unexpected, given the scale of its ambitions to transform its economic model. Nevertheless, it is crucial for the EU to address the concerns of various stakeholders and ensure a fair and effective transition to a carbon-neutral economy.

– FT article “The EU’s ambitious climate agenda is running into resistance”