EU climate package fairly good, but some changes needed: EK

The Confederation of Finnish Industries (EK) supports the EU’s ambitious climate policy and recognize the benefits of the comprehensive package but sees also some worrying elements.

For instance, the expansion of emissions trading to maritime and road transport, as well as the introduction of carbon tariffs, will bring more costs to companies, said EK in a press release on Friday.

At the same time, substantial additional investment will be needed in new technologies.

The European Green Deal took a major step forward when the Commission published its “Fit for 55” climate initiatives on 14 July. The 12 legislative proposals presented concrete steps for Europe towards the 55% emission reduction target by 2030.

The upgraded target for 2030 demands an unprecedented effort from the business community, EK Director General Jyri Häkämies said.

“Achieving the emission reduction target requires companies to make massive investments in innovation, technology and low-emission production and services. As companies are key drivers of climate policy, Fit for 55 legislation must be business- and investment-friendly. Finland, as well as all other EU member states, must be seen as an attractive investment environment,” said Häkämies.

Chief Policy Adviser Kati Ruohomäki lists the main advantages of the legislative package.

“We support the EU’s way of grouping several legislative initiatives together. It helps to preserve coherence. In addition, the additional efforts to achieve tighter climate target are rightly shared to all sectors and member states,” Ruohomäki said.

The strengthening role of the EU Emissions Trading is welcomed. As well as the continuity of free allocation and electricity price compensation to prevent a risk of carbon leakage. It is also important that the EU Emissions Trading System would consider new climate technologies, such as carbon capture and reuse.

Carbon tariffs are linked tightly to EU Emissions Trading System, and the payment will be made through CO2-allowances using same price as in the EU ETS.

Concerning national energy saving obligation, the Commission allows use of voluntary energy efficiency agreements. In Finland, more than 60% of energy use is included in such agreements, covering companies, real estate agents and municipalities.

The EK also suggested to bring change in the package to EU Emissions Trading System in various sectors, Carbon border tariffs CBAM, Energy efficiency, Energy taxation, Country-specific emission reduction targets, Renewable Energy etc.