Members of the European Parliament are debating today a resolution asking to veto the Commission’s decision to label investments in nuclear and natural gas as environmentally sustainable [1]. A vote will take place tomorrow.

On 14 June, Members of the European Parliament’s Environment and Economic Affairs Committees endorsed the veto in a tight vote. [2] Usually, committee votes are perceived as a likely indication of how the plenary will vote. However, the final outcome is difficult to predict in this case.

In February, the European Commission adopted a Complementary Delegated Act (CDA) that labels specific gas and nuclear activities as environmentally sustainable by listing them as transitional activities under the Taxonomy Regulation as of January 2023 [3].

The European Parliament and the Council of the EU have the power to veto this decision.

In practical terms, if MEPs vote not to veto, gas and nuclear investments would be considered as green as of 1 January 2023. The EU Taxonomy would label unabated fossil gas-fired power generation as environmentally sustainable.

Colombia [4], China [5] or even Russia [6] have recently adopted their national ‘taxonomies’, which have all decided against labelling fossil gas-fired power generation as green.

Mathilde Crêpy, Senior Programme Manager at Environmental Coalition on Standards (ECOS), said:

EU leaders have said countless times that they want the EU to be the climate leader. It is simply illogical to label investments in fossil gas as green. Meanwhile, countries such as Colombia, China, or even Russia, make it clear to their investors that gas investments cannot be considered environmentally sustainable. Members of the European Parliament stand a unique chance to walk the climate talk. MEPs should not endorse state-sponsored greenwashing.

Gas is not green – Investors and scientists agree
The investors community itself has consistently spoken against any such inclusion. They have voiced concerns that going against science adversely impacts both the credibility and usability of the Taxonomy. [7]

The IPCC, EIA, and the Platform on Sustainable Finance have proven that there is no room for investment in new fossil fuel and nuclear power if we want to meet the Paris Agreement goals of keeping global warming below 1.5°C.

Adopting the CDA would be disastrous for the credibility of the Taxonomy Regulation and for the role of the EU as a world leader in sustainable finance.

 
Background:
ECOS is one of the 50+ members of a Platform on Sustainable Finance created by the European Commission in October 2020 to inform the development of the EU Taxonomy.

The EU Taxonomy is a science-based classification system established to clarify which investments are sustainable. The aim is to prevent greenwashing and help investors assess whether investments are consistent with policy commitments like the EU Green Deal.