What does the new European agreement mean?

What these agreements will mean in practice in 2027 now depends on individual governments. The €86.7 billion European Social Climate Fund should in any case prevent low-income people from falling into hardship due to new carbon dioxide requirements. This money can be used to support income, energy investments in existing homes, and to shift to greener modes of transportation such as electric cars and expanding public transportation.

Member states should set their own schemes for subsidies and income support. Additional arrangements must be made if energy prices remain exceptionally high. In that case, caps on what people have to pay could be set or new taxes on carbon dioxide emissions from buildings and ground transportation could be delayed for another year, until 2028.

industry

The billion dollar fund will be largely funded by industry, which will have to pay more and more carbon dioxide emissions. These emissions are linked to the exemptions granted by the European Union. Some of these allowances are given free of charge, particularly to sectors unable to afford expensive alterations due to competition from outside the EU. Other rights must be paid.

By reducing total allowances, making allowances more expensive and not distributing free allowances after 2034, the EU hopes industrial emissions will fall further. Since 2005, when the emissions allowance system was introduced, greenhouse gas emissions from European industry have already been reduced by 41 percent. In 2030, it should be 62 percent.

Another important change is that shipping will be subject to EU regulation. Aviation was already in compliance with European emissions regulations, but naval vessels notoriously polluting were not yet. These too are now being brought under the European ecosystem in stages.

“up to an additional 460 euros”

European Commissioner Frans Timmermans, who is in charge of the Green Deal, greening Europe, expressed his satisfaction with the agreements. “At the end of a difficult year, this is very positive news,” Timmermans says. “Emissions trading is at the heart of the Green Deal, to put a price on carbon dioxide. A strengthened emissions trading system now will help boost investments in carbon dioxide reduction and reduce emissions further and faster.”

Flemish Environment Minister Sahel Demir (N-VA) described the agreement as part of “the European rat race to systematically impoverish singles and families”. Last year, it already calculated that the new emissions trading system would cost the average family between 320 and 460 euros more per year in 2030. This is one reason Flanders is so reluctant to agree to the European climate package.

Saturday’s agreement is temporary. It must now be approved by the entire European Parliament and by the governments of individual member states.