EU climate policy to 2040: Initial steps towards more flexibility and effort sharing

By setting a 90 per cent emissions reduction target for 2040, the European Union (EU) has taken a key step forward. This decision marks the start of a substantial realignment of its core climate policy instruments. The Commission's implementation package is expected to comprise more than a dozen legislative proposals, the final form of which is to be negotiated by the Council and the European Parliament. The proposals include, among other items, the crediting of emission reductions from international mitigation projects within the EU Emissions Trading System (ETS), the further development of rules governing land use, land-use change and forestry (LULUCF) and the integration of carbon dioxide removal (CDR) into EU climate policy. Moreover, a political decision is needed on the future role of national targets within the EU's climate policy architecture. Although the EU can still be regarded as a frontrunner at the global level, given its 90 per cent emissions reduction target, the inclusion of flexibilities in achieving this target creates uncertainties that significantly undermine the credibility and effectiveness of EU climate policy. It is therefore crucial that the Commission promptly presents its detailed proposals on international carbon credits and on updating the overall regulatory framework.