European Green Deal: Setting The Course For A Sustainable Future

• The European Green Deal aims to transform Europe into a carbon-neutral economy by 2050.
• This article discusses the European Green Deal in more detail, what it means for businesses, and what opportunities it brings.

What is the European Green Deal?

When it was unveiled in 2019, European Commission President, Ursula von der Leyen, described the Green Deal as “Europe’s man on the moon moment”. It’s a fitting description giving the enormity of the task – to become the world’s first climate-neutral continent.

The European Green Deal effectively marks the beginning of a 30-year sustainability strategy for the EU. It sets out a roadmap to enable a ‘just’ transition to a sustainable economy and achieve the goals set out in the 2015 Paris Agreement.

In the European Commission’s own words, the Green Deal “is a new growth strategy that aims to transform the EU into a fair and prosperous society, with a modern, resource-efficient and competitive economy where there are no net emissions of greenhouse gases in 2050 and where economic growth is decoupled from resource use.”

What are the goals of the European Green Deal?

At a top level, the goals of the Green Deal are quite straightforward:

• Become climate neutral by 2050
• Protect human life, plants, and animals by cutting pollution
• Help EU companies become world leaders in sustainable products and technologies
• Ensure a just and inclusive transition

While the goals may seem straightforward, their achievement will require immense effort from all aspects of European society. National governments, companies, and citizens will all have an important role to play.

What is the European Green Deal roadmap?

The EU Commission set out an initial roadmap for the Green Deal with targeted milestones for 2020 and 2021. The roadmap covers a wide range of areas and sets out timelines for the delivery of new legislation, strategies, and initiatives.

To simplify the complexity of the roadmap, we’ve broken down the main policies that directly affect businesses in the EU, outlined the key commitments, and their current progress.

1. Climate ambition

A core aspect of the European Green Deal. The plan proposes to ramp up climate action targets and set an objective of carbon neutrality by 2050 at the latest.

Key commitments:

• Proposal for a European ‘Climate Law’ legislating the 2050 climate neutrality objective
• Plan to increase the EU 2030 climate target to at least 55%
• Proposals for revisions of relevant legislative measures to deliver on the increased climate ambition such as the Emissions Trading System Directive and Energy Efficiency Directive
• Proposal for a revision of the Energy Taxation Directive

Progress to date?

The proposal for a European climate law to ensure a climate-neutral EU by 2050 was introduced in 2020. It’s still under discussion and talks are expected to conclude this year.

The commission has also recently concluded a consultation on the revision of the EU Emissions Trading Scheme (EU ETS). The proposal may seek to extend the ETS into new sectors and enhance the scheme to better align with more ambitious climate targets. Further details are expected to be published in Q2 2021.

2. Clean affordable and secure energy

To achieve climate neutrality, we need to decarbonise our energy system. Stronger targets for renewables deployment and integration will be required, as part of the European Green Deal. In addition, new technologies such as ocean energy need to be explored to assist in the green transition.

Key commitments:

• Assessment of the final National Energy and Climate Plans
• Strategy for smart sector integration
• Strategy on offshore renewable energy
• Evaluation and review of the Trans-European Network – Energy Regulation
• ‘Renovation wave’ initiative for the building sector

Progress to Date?

In November 2020, the Strategy On Offshore Renewable Energy was released. The strategy proposes to “increase Europe's offshore wind capacity from its current level of 12 GW to at least 60 GW by 2030 and to 300 GW by 2050”.

The European Commission has also published its Renovation Wave Strategy to improve the energy performance of buildings. The strategy aims to “at least double renovation rates in the next ten years and make sure renovations lead to higher energy and resource efficiency”.

3. Industrial Strategy for a clean and circular economy

Industry will be key to achieving climate goals. The commission states that “it takes 25 years – a generation – to transform an industrial sector and all the value chains”. Transforming our industry will need to start today if we’re to meet targets for 2050.

Key commitments:

• EU Industrial Strategy
• Circular Economy Action Plan
• Proposal to support zero-carbon steel-making processes by 2030
• Propose legislative waste reforms

Progress to Date?

The commission has now adopted the European Industrial Strategy. The plan outlines a package of initiatives to make Europe’s industry cleaner, more competitive, and equipped to take advantage of the digital age.

We have also seen the publication of the new Circular Economy Action Plan. This plan presents several measures to transition to a circular economy including making sustainable products the norm, preventing waste, and prioritising areas where the potential for circularity is high.

4. Sustainable and smart mobility

The transport sector accounts for one quarter of total GHG emissions in the EU. Road, rail, aviation, and shipping will need to achieve a 90% reduction in emissions by 2050.

Key commitments:

• Strategy for sustainable and smart mobility
• Funding call to support the deployment of public recharging and refuelling points as part of alternative fuel infrastructure
• Assessment of legislative options to boost the production and supply of sustainable alternative fuels
• Proposal for more stringent air pollutant emissions standards for combustion-engine vehicles

Progress to Date?

In December 2020, the Sustainable and Smart Mobility Strategy was adopted by the commission. Some key initiatives that the strategy outlines include boosting the uptake of low-emission vehicles, making urban mobility more sustainable, and using data and Artificial Intelligence (AI) to make our transport systems smarter.

5. Greening the Common Agricultural Policy / ‘Farm to Fork’ Strategy

Farmers, agri-food businesses, and rural communities have an essential role to play to decarbonise our food system. Sustainable food is a cornerstone policy of the European Green Deal and should result in a massive transformation of the food sector in the coming decades.

Key commitments:

• ‘Farm to Fork’ Strategy
• Measures, including legislative, to significantly reduce the use and risk of chemical pesticides, as well as the use of fertilizers and antibiotics

Progress to Date?

The ‘farm to fork’ strategy was published in 2020. This strategy sets out a roadmap to create a more healthy and sustainable EU food system. The main objectives of the plan are to reduce the amount of chemicals used in agriculture, promote organic farming, step up the fight against food waste, and empower consumers to choose healthier, greener diets.

In March 2021, the European Commission published the Organic Action Plan. The plan sets out a path to achieve ‘at least 25% of the EU’s agricultural land under organic farming and a significant increase in organic aquaculture by 2030’.

For further insight on the transition to sustainable food systems, check out our recent FutureproofedCities article - Local Food Systems: A Sustainable Food System For Cities.

5. Preserving and protecting biodiversity

Biodiversity loss and the climate crisis are interdependent. When one gets worse, so does the other. We need to take greater care of our natural environment if we want to continue to reap its benefits. Our food, health, medicines, and wellbeing are heavily dependent on maintaining healthy balanced ecosystems.

Key commitments:

• EU Biodiversity Strategy for 2030
• New EU Forest Strategy
• Measures to address the main drivers of biodiversity loss
• Measures to support deforestation-free value chains

Progress to Date?

The EU Biodiversity Strategy for 2030 was launched in May 2020. The plan seeks to establish legally protected areas for at least 30% of land and 30% of sea in Europe. Restoring degraded ecosystems is also a primary objective of the strategy - with plans to restore 25,000 km of rivers to a free-flowing state and plant 3 billion trees by 2030, among others.

A new EU strategy for Forests is currently under consultation. The strategy will focus on EU forest protection, restoration & sustainable management, and on world forests where not already covered.

6. Towards a zero-pollution ambition for a toxic-free environment

The creation of a pollution-free environment will require action on two main fronts. We need to find better solutions to prevent pollution from being created in the first place and also improve and innovate in dealing with pollution when it occurs.

Key commitments:

• Chemicals strategy for sustainability
• Zero pollution action plan for water, air and soil
• Revision of measures to address pollution from large industrial installations

Progress to Date?

In October 2020, the Chemical Strategy for Sustainability was adopted. This has been billed as one of the first steps to creating a zero pollution and toxic-free environment in the EU. Some notable actions proposed in the strategy include the banning of the most harmful chemicals in consumer products and increasing investment in innovation to create safer and more sustainable chemicals.

Why should businesses be interested in the European Green Deal?

The Green Deal will transform the economic landscape of Europe for the next 30 years. This transformation will create significant economic opportunities for businesses, especially those well-placed to take advantage of the transition.

Investment opportunities, financial incentives, and new markets will present themselves in the coming decades, providing companies with the ability to grow their business and expand into new areas. The construction sector is just one example:

Green Deal Industry Impact - The Construction Sector

Companies operating in the construction industry will be well placed to take advantage of Green Deal opportunities with appropriate planning. The transition towards sustainable infrastructure will be key to achieving the goals of the European Green Deal and overlaps many different areas of the roadmap.

• Clean affordable and secure energy – To achieve clean energy targets, massive investment will be needed to build out new renewable power plants, grid infrastructure, and enabling technologies. Construction firms will be at the forefront of this movement.
• Building and renovating in an energy and resource-efficient way – The recently announced strategy on renovation plans to double the renovation rate to cut emissions, boost recovery, and reduce energy poverty. By 2030, 35 million buildings could be renovated creating up to 160,000 additional green jobs in the construction sector.
• Sustainable and Smart Mobility – The transport sector is undergoing massive change with the growth of electric vehicles. The EU estimates by 2025, about 1 million public recharging and refuelling stations will be needed for the 13 million zero- and low-emission vehicles expected on European roads. The construction sector will be key to the installation of this charging infrastructure.

Case study: D’Ieteren Immo: sustainable real estate driven by innovation

FutureproofedBusiness recently partnered with D'Ieteren Immo, a player in the real estate industry, to create a sustainability strategy to meet many of these climate goals.

Futureproofed helped us translating our ambitions into a company-wide strategy for sustainable value creation. Their intensive bottom-up trajectory with external stakeholder consultations and interactive workshops resulted in a clear set of priorities, targets and KPIs to follow up on our progress. - Paul Monville, CEO

How can Futureproofed Business help?

The Green Deal is a broad-ranging strategy with many different sub-set strategies and initiatives that will evolve in the coming years. It can be difficult to stay on top of the changes and plan for the future. This is where we can help.

Our team of consultants can help businesses navigate the opportunities and risks that the Green Deal may present.

We have already helped a wide range of clients prepare for the upcoming changes and requirements of the Green Deal. We assisted them with setting up their own 'roadmap for the future' with clear environmental and climate goals and well-defined actions and measures.