The EU proposes a plan to label gas and nuclear investments green

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Steam rises from the cooling towers of the Electricite de France (EDF) nuclear power plant in Belleville-sur-Loire, France, 12 October 2021. REUTERS / Benoit Tessier

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  • European Commission that develops rules for green investments
  • The draft proposal labels nuclear, some gas plants as green
  • Countries disagree on the green credentials of fuels
  • EU consultants said gas is not compatible with climate goals

Jan 1 (Reuters) – The European Union has come up with plans to label some natural gas and nuclear energy projects as “green” investments after a year-long battle between governments over which investments are truly climate-friendly.

The European Commission is expected to propose rules in January to decide whether gas and nuclear projects will be included in the EU’s “taxonomy of sustainable finance”.

This is a list of the economic activities and environmental criteria they must meet in order to be labeled as green investments.

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By limiting the “green” label to truly climate-friendly projects, the system aims to make such investments more attractive to private capital and to stop “greenwashing”, in which companies or investors overestimate their green credentials.

Brussels has also moved to apply the system to some EU funding, which means that the rules could decide which projects are eligible for certain public finances.

A draft Commission proposal, seen by Reuters, would label investments in nuclear power plants as green if the project has a plan, funds and site to safely dispose of radioactive waste. To be considered green, new nuclear power plants must receive construction permits before 2045.

Investments in natural gas power plants would also be considered green if they produce emissions below 270 g CO2 equivalent per kilowatt hour (kWh), replace a more polluting fossil fuel plant, receive a building permit by 31 December 2030 and plan to move to low-carbon gas plants by the end of 2035.

The production of gas and nuclear power would be labeled green because they are “transitional” activities, defined as those that are not completely sustainable, but that have emissions below the sector average and do not block polluting activities.

“Taking into account scientific advice and current technological progress, as well as the different transition challenges between Member States, the Commission considers that natural gas and nuclear power play a role as a means of facilitating the transition to a predominantly renewable future. “, the European The Commission said in a note.

To help states with diverse energy backgrounds transition, “under certain conditions, solutions that don’t look exactly ‘green’ at first glance may make sense,” a Commission source told Reuters, adding that investments in gas and nuclear power they would have to face “strict conditions”. .

EU countries and a group of experts will review the draft proposal, which could change before publication scheduled for January. Once published, it could be vetoed by a majority of EU countries or by the European Parliament.

Politics has been mired in government pressure for more than a year, and EU countries disagree on which fuels are truly sustainable.

Natural gas emits about half the CO2 emissions of coal when it is burned in power plants, but gas infrastructure is also associated with leaks of methane, a powerful gas that warms the planet.

EU consultants had recommended that gas installations not be labeled as green investments unless they met a CO2e / kWh emission limit of less than 100g, based on the deep cuts in emissions that scientists believe are necessary to avoid. disastrous climate change.

Nuclear power produces very low CO2 emissions, but this year the Commission asked for expert advice on whether to consider green fuel given the potential environmental impact of radioactive waste disposal.

Some environmental activists and Green EU lawmakers have criticized the leaked gas and nuclear proposal.

“By including them … the Commission risks undermining the credibility of the EU’s role as a leading market for sustainable finance,” said Greens President Philippe Lamberts.

Austria opposes nuclear power, along with countries like Germany and Luxembourg. EU states, including the Czech Republic, Finland and France, which derive around 70% of their energy from fuel, see nuclear power as crucial for phasing out carbon energy that emits CO2.

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Reporting by Kate Abnett; Additional reporting by Sabine Siebold; Editing by Frances Kerry and Louise Heavens

Our Standards: Thomson Reuters Trust Principles.

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