The EU needs a bold climate strategy

Scientists report that global temperature increases must be limited to below 1.5 degrees Celsius. With global greenhouse gas emissions continuing to increase and rising temperatures driving up the frequency of extreme weather events, the world needs a greater commitment to climate policy.

By: Date: July 19, 2019 Topic: Energy & Climate

This article was originally published in The Nikkei Veritas, Caixin, Rzeczpospolita and Ta Nea

The Nikkei Veritas logo

Caixin logo

Ta Nea logo

Rzecszpospolita logo

In order to avert catastrophic climate change for the entire human population, global temperature increases must be limited to below 1.5 degrees Celsius. Scientists have shown that achieving net-zero carbon emissions before 2050 is essential to this achievement, which has become a key goal of the Paris agreement. But as global greenhouse gas emissions continue to increase and rising temperatures drive up the frequency of extreme weather events, the world needs to commit much more to climate policy.

Surveys confirm that citizens in the EU want to see progress on fighting climate change. Especially the young generation has been vocal and has already shaped elections with its climate demands. The European Union should therefore play a central role in global efforts to decarbonise. True, Europe produces only 16% of global emissions and the EU only 10%. But if the EU does not decarbonise, less developed parts of the world may find it even more difficult to convince their population to do so. A successful decarbonisation strategy in the EU could also become a business opportunity where the EU could export technology, for example to Africa or India, two regions where emissions are set to grow substantially in the coming decades as they develop. In turn, failing to address the challenge would not only be considered inacceptable by citizens, but could mean that the EU loses out on key technological developments that will shape the future. For example, already now the EU may be lagging on electro mobility.

Yet, the EU is far away from its self-set goals of decarbonisation. While the share of renewable energy in EU gross final energy consumption rose from 10.6 percent in 2007 to 17.5 percent in 2017, this number also means that more than 80% of energy consumption is still not renewable. Moreover, as GDP continues to grow, overall emissions are falling only quite slowly and actually even increased in 2017. Certain sectors such as transport lag behind in their efforts to reduce their emissions and coal phase out is too slow in several countries including Germany and Poland. Finally, Europe actually consumes more greenhouse gases than it produces. In fact, consumption amounts to 18% of global consumption – in other words, Europe’s imports are significantly more carbon-intensive than its exports. To succeed with decarbonisation, the EU will have to change gears and pursue three priorities.

First, the EU needs to put a price on greenhouse gas emissions in all sectors. The current emission trading system only covers some 50% of emissions. Moreover, the price for emission certificates is too low to provide a sufficient incentive to decarbonise. The emission trading system should either cover all sectors or be complemented with a tax on emission that are not covered by the system. Once an all-encompassing and expensive tax on emissions is established, the price signal should drive significant innovation as well as individual efforts to decarbonise. But to avoid even more carbon leakage the EU needs to establish also a tariff on imports of carbon-intensive products to disincentivise firms from shifting production to countries that have lower taxes on emissions.. Such a step would be compatible with the WTO and is also called for by a large group of US economists. Given the size of the EU’s market, it would also provide an incentive to third countries to adjust their production processes.

Second, industrial policy can usefully support decarbonisation. For example, the state needs to set standards that make it easier to switch from the current carbon-intensive mobility towards electro mobility. The EU should also support research and development of new technologies. The government also needs to play a role in the building of the necessary infrastructure for clean electric energy. Public funding for innovation will help reduce the cost of clean energy.

Third, serious climate action will be hugely transformative for the entire economic and social system. It will touch vested interest and result in social fallout as the French yellow vest movement has shown. Lowering the cost of the transformation is all the more important as key industries depend on access to affordable energy. The EU should therefore go ahead with a significant public investment programme. Moreover, the carbon tax proceeds should be redistributed to reduce the burden on low-income households.

Only bold action will suffice to avoid a global climate catastrophe. The EU needs to step up to the challenge.

Republishing and referencing

Bruegel considers itself a public good and takes no institutional standpoint.

Due to copyright agreements we ask that you kindly email request to republish opinions that have appeared in print to communication@bruegel.org.

View comments
Read about event

Upcoming Event


Climate change and the role of central banks

What connections exist between central banks and climate change, and what are the resulting implications?

Speakers: Emanuele Campiglio, Paul Hiebert, Pierre Monnin, Kjell G. Nyborg, Luiz Awazu Pereira da Silva, Mario Quagliariello, Mattia Romani, Paweł Samecki and Dirk Schoenmaker Topic: Energy & Climate, European Macroeconomics & Governance Location: Narodowy Bank Polski, Świętokrzyska 11/21, 00-919 Warsaw
Read article More on this topic More by this author


The Democrats need to have a climate-only TV debate. For Americans and for the rest of us

A series of global summits mean the months between now and November 2020 will be crucial to the future of climate change.

By: Simone Tagliapietra Topic: Global Economics & Governance Date: August 6, 2019
Read article Download PDF More on this topic More by this author

External Publication

The impact of the global energy transition on MENA oil and gas producers

Endowed with half of the world's known oil and gas reserves, the Middle East and North Africa (MENA) region is cornerstone of the global energy architecture. This article argues that – together with the pressing need to create jobs opportunities for a large and youthful population – the possibility of the world moving more aggressively towards a low-carbon future should represent a key argument for the implementation of economic reform programmes.

By: Simone Tagliapietra Topic: Energy & Climate Date: August 5, 2019
Read article More by this author


The Coming Clash Between Climate and Trade

The new leaders of the European Union, who have relentlessly championed open markets, will, ironically, likely trigger a conflict between climate preservation and free trade. But this clash is unavoidable, and how Europe and the world manage it will help to determine the fate of globalisation, if not that of the climate.

By: Jean Pisani-Ferry Topic: Energy & Climate, Global Economics & Governance Date: August 1, 2019
Read about event More on this topic

Upcoming Event


Bank resolution: its impact in the EU

Closed-door workshop on various aspects of bank resolution.

Speakers: Jon Cunliffe, Martin J. Gruenberg and Elke König Topic: Finance & Financial Regulation Location: Bruegel, Rue de la Charité 33, 1210 Brussels
Read article More on this topic More by this author

Blog Post

Modernising European Competition Policy: A Brief Review of Member States’ Proposals

French, German and Polish governments have jointly proposed options for modernising EU competition policy. The debate to recalibrate European competition rules was already well underway. So, it is not surprising that proposals are consistent with other statements made by France and Germany. Yet, proposals do not address current issues weighing on the international competition community, such as conglomerate effects theory or algorithmic collusion.

By: Mathew Heim Topic: Innovation & Competition Policy Date: July 24, 2019
Read article More on this topic


EU policy recommendations: A stronger legal framework is not enough to foster national compliance

In 2011, the EU introduced stricter rules to monitor the implementation of country-specific policy recommendations. Using a new dataset, this column investigates whether these new laws have increased national compliance. There is no evidence that these stricter processes matter for implementation rates, whereas macroeconomic fundamentals and market pressure are important determinants of implementation progress. These results suggest ways to improve the effectiveness of European policy coordination that go beyond stronger legal processes.

By: Konstantinos Efstathiou and Guntram B. Wolff Topic: European Macroeconomics & Governance Date: July 23, 2019
Read article More on this topic More by this author

Blog Post

Croatia’s path into the banking union

Croatia seems a suitable candidate for euro area accession: there is a tight peg to the euro, high public debt is coming down, and the banking sector is already dominated by euro area banks. But the Eurogroup has rightly targeted reforms of the state’s role in the economy as a precondition for participation in ERM II and the banking union. None of the announced reform plans are new or easily concluded within the timeframe that has now been agreed.

By: Alexander Lehmann Topic: European Macroeconomics & Governance Date: July 18, 2019
Read article More on this topic More by this author


Von der Leyen’s Green Deal isn’t just a plan for the environment

Ursula von der Leyen's proposal of a European Green Deal is ambitious and urgent. Not only does it aim to reduce the continent's emissions, but it also has the potential to grow the EU's economy and transform the bloc's politics.

By: Simone Tagliapietra Topic: Energy & Climate Date: July 18, 2019
Read article More on this topic

Blog Post

Talking about Europe: Die Zeit and Der Spiegel 1940s-2010s

An on-going research project is seeking to quantify and analyse printed media discourses about Europe over the decades since the end of the Second World War. A first snapshot screened more than 2.8 million articles in Le Monde between 1944 and 2018. In this second instalment we carry out an analogous exercise on a dataset of more the 500 thousand articles from two German weekly magazines: Die Zeit and Der Spiegel. We also report on the on-going work to refine the quantitative methodology.

By: Enrico Bergamini, Emmanuel Mourlon-Druol, Francesco Papadia and Giuseppe Porcaro Topic: European Macroeconomics & Governance Date: July 18, 2019
Read article More on this topic More by this author

Blog Post

How should the relationship between competition policy and industrial policy evolve in the European Union?

Competition policy aims to ensure that market practices and strategies do not reduce consumer welfare. Industrial policy, meanwhile, aims at securing framework conditions that are favourable to industrial competitiveness, and deals with (sector-specific) production rules as well as the direction of public funds and tax measures. But, how should competition policy and industrial policy interact? Is industrial policy contradicting the aims of competition policy by promoting specific industrial interests?

By: Georgios Petropoulos Topic: Innovation & Competition Policy Date: July 15, 2019
Read about event More on this topic

Past Event

Past Event

The 4th industrial revolution: opportunities and challenges for Europe and China

What is the current status of EU-China relations concerning innovation, and what might their future look like?

Speakers: Elżbieta Bieńkowska, Chen Dongxiao, Patrick Child, Eric Cornuel, Maria Demertzis, Ding Yuan, Luigi Gambardella, Jiang Jianqing, Frank Kirchner, Pascal Lamy, Li Mingjun, Gwenn Sonck, Gerard Van Schaik, Reinhilde Veugelers, Wang Hongjian, Guntram B. Wolff, Xu Bin, Zhang Hongjun and Zhou Snow Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: July 12, 2019
Load more posts