The EU makes its move on a green coronavirus recovery
The European Commission this morning proposed a $825 billion package of economic responses to the coronavirus pandemic that includes financing for renewable energy, electric vehicle charging and other emissions-friendly projects.
Why it matters: The energy components of the "Next Generation EU" plan, part of a wider multi-year budget proposal, appear to be the most substantial attempt yet to stitch low-carbon investments into economic recovery plans.
One level deeper: Supporting the European Green Deal — the bloc's long-term climate framework unveiled before the pandemic — is one of the "policy fundamentals" of the proposed package of grants and loans, per the summary posted this morning.
But, but, but: The plan will require backing from all EU member states and the European Parliament, per Reuters, which notes it will be discussed at a mid-June summit but "any final deal is likely to take longer."
- Their item and AP both report that hurdles lie ahead, with AP noting that EU nations are "deeply divided" over how to structure the overall recovery plan and that it's "likely to set off weeks of wrangling."
The big picture: The shape of governments' massive stimulus plans could affect the long-term trajectory of carbon emissions after this year's unprecedented pandemic-fueled decline.
- "Imminent fiscal recovery packages could entrench or partly displace the current fossil-fuel-intensive economic system," a paper earlier this month in the Oxford Review of Economic Policy said.
Where it stands: Beyond the EU proposal, individual governments are already beginning to roll out economic packages that affect energy technologies and fuel-intensive sectors.
- The French government yesterday unveiled a roughly $9 billion plan to aid its domestic auto industry that includes major new incentives for buying electric cars.
When it comes to planes, Bloomberg reports individual countries are handling it differently.
- "Germany’s multibillion euro bailout of Deutsche Lufthansa AG may cost the airline some precious airport slots, but one thing it won’t have to do is meet any new environmental rules."
- This contrasts with airline rescue packages in France and Austria, which aim to address climate by cutting routes that compete with trains.
- In the Netherlands, the "Dutch finance minister has said emissions cuts should be a condition of state support for national carrier KLM."
Meanwhile, in the U.S., the big airline aid package approved in March does not include the emissions provisions some Democrats had sought.