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Euractiv
16-07-2025
- Business
- Euractiv
Europe's 2040 climate target isn't just for environmentalists
William Todts is the Executive Director of The European Federation for Transport and Environment (T&E). He oversees the organisation's strategy to achieve emissions-free mobility. The European Green Deal is alive and kicking. With the US abandoning the Paris Agreement, the centre-right led EU Commission's proposal of a 90% emissions reduction target by 2040 is a very big deal. The question now is how to get this ambitious proposal adopted, and how to design it so that it leads to progress, not just in Europe but internationally. It's clear the Commission's 2040 vision cannot be realised through climate policy alone. To succeed, the EU's 2040 strategy must encompass energy security, defence, economic security, investment and industrial strategy. This is partially about outcomes. For example, a strong 2040 target could save between €70 and €90 billion a year flowing out of Europe to buy oil – from the Middle East, Trump and other petro-dictators. As important is 'how' we get there. China combined energy security and industrial strategy with smart regulations and subsidies to become the cleantech manufacturing powerhouse it is today. Europe needs to learn from this. A successful 2040 strategy would see Europe achieving energy independence, with the EU's domestic battery industry supporting not just cars and storage but also military drones and unmanned underwater vessels. Meanwhile, EU producers would vie with Chinese companies for electric vehicle, wind and heat pump market share in emerging economies, having left Japanese and US laggards behind long ago. To be successful, the 2040 strategy cannot just be the strategy of the left. It requires a grand coalition that combines the best of both aisles: a belief in a state that supports and sets direction, and also a belief in entrepreneurship and free markets so that successful solutions can be scaled quickly – even when that is disruptive. That being said, Europe cannot decarbonise the world on its own. Today, it accounts for 6% to 7% of global emissions; by 2030, that will be a lot less. The more successful we are, the more we lose our ability to influence the global emissions trajectory simply by reducing Europe's own emissions. So how do we create global leverage? The world is watching whether Europe's energy strategy actually works. Europe is building one of the great electrostates of the 21st century, but the benefits are not yet clear to see. First, it must continue building renewables and make full use of the revolutionary potential of electric vehicles and battery storage. If we want to go fast, we must make it much easier to build clean projects like wind or power lines, or indeed industrial facilities like battery factories or processing plants. In fact, the 2040 plan should be an electrification action plan as much as a climate strategy. Second, one of the key lessons from my recent trips to Asia is that countries look to Europe for inspiration on how to regulate. Few countries have the ability to develop the innovative, complex policies required to decarbonise our societies. Historically, the EU, California, China and the US led the way. It now falls to Europe to develop policies that work, so that other nations can copy and adapt them. Third, it is logical that the EU starts to think about how it can encourage greater international ambition through its own policies. This debate is polluted by the catastrophic inclusion of worthless offset projects in Europe's Emissions Trading Scheme 15 years ago. But it's not a debate we can afford to avoid. The Commission suggests international credits focused on bioenergy with carbon capture and storage and direct air capture and storage. This is complicated, expensive and niche. Instead, we could integrate this into the EU's foreign affairs and development policy. Could the EU strike trade and financing deals with countries to achieve additional emission cuts, partially with European technology and know-how? Could we count this towards our 2040 efforts without flooding the Emissions Trading Scheme with those credits? It would not be simple, but it would actually support Europe's wider goals. That's not just nice to have. If we want the 2040 agenda to succeed, we need to get to a place where you no longer have to be an environmentalist to support ambitious climate measures.
Euractiv
09-07-2025
- Business
- Euractiv
Europe's raw material shortages threaten EV decarbonisation goals
The European Union's ambitious targets for decarbonising its transport sector are increasingly threatened by a looming shortage of critical raw materials necessary for electric vehicle batteries, particularly cobalt, lithium and nickel. Despite significant policy efforts, recent reports have underscored the gravity of raw material constraints and highlighted Europe's risk of falling behind global competitors in EV manufacturing. Julia Poliscanova, Senior Director for Vehicles and E-mobility Supply Chains at the green transport NGO T&E, warned at a recent Euractiv event that though there was building attention on this issue in Brussels a few years ago, that focus seems to have been lost since publication of the Critical Raw Materials Act. 'Two years later, we have the act, but I think we lost some of this zeal and ambition,' she said. 'Maybe it's the change of the Commission, but the momentum is no longer there, and it would be good to get it back.' 'Generally, as we go toward all aspects of the energy transition – be it renewables, be it green hydrogen, be it electric vehicles – the cleantech behind it relies on some of those critical minerals,' she noted. She said that more mining is needed, but it needs to be done strategically. 'I think everyone understands that, but then some people jump on that to say, well, this is also bad because we'll have more mining. But actually, the largest mining today is coal, then iron and then gold. So these critical materials that we need are different from the mining elements we've had in the past. And we require less [than those other mined substances], not more, we just need to focus.' Europe doesn't have enough Mark Mistry, Director of Public Policy and Sustainability at the Nickel Institute, an industry association, agreed. He pointed out there are three pillars of the Critical Raw Materials Act: increased mining, increased recycling, and making imports more strategic. 'We need to make sure we're supplied with raw materials, given the fact that in some cases, if I take the example of nickel, we will not be able to satisfy the growing demand, especially for EV batteries, with the nickel that we can mine or recycle in the European Union.' Speaking at the event, Daniel Cios, the raw materials policy officer at the European Commission, said that the EU executive still views this as a critical issue. 'We haven't lost any energy in the Commission, we're devoted as much as we were before or even more with the hard work of implementing the act and selecting the strategic projects,' he said. There has been a 'learning by doing' experience with the first round of strategic projects, which the act enables to get special funding and permitting procedures because the minerals they're mining are critical. 'We see actually after the first projects were selected that they get a lot of attention in the media, in the discussions with the governments of those countries and third countries, and many companies came to us and said they got a lot more interest from financial institutions, off-takers and suppliers after being selected,' he said. 'So we see this has really changed the discussion around raw materials projects. This is a very tangible result.' Poliscanova said she views the strategic projects as being one of the most important parts of the act. 'The critical raw materials act as agreed is a really great framework,' she said. 'I was in a meeting last year in Canada, which is a mining jurisdiction, and people from the Canadian government were saying Julia, we would love the strategic projects in the act, that's such a great requirement, we're going to repeat something like that. Strategic projects is really the way to go. And permitting is a great compromise where we're going faster, but we're not compromising on environmental safeguards.' Environmental concerns However, there have been concerns raised about whether the easier permitting and financing procedures given to these strategic projects could lead to environmental damage from new mining activities, where the materials could have been obtained instead through recycling or imports. Benedetta Scuderi, an Italian Green MEP who sits on the European Parliament's industry committee, said at the event that we need a balance going forward. 'It's important that we make the circular economy sector more competitive in terms of being able to substitute some of the needs that we have for critical raw materials,' she said. Scuderi warned that 'even if we increase the access to critical raw materials, we have a problem in actually manufacturing [the cars].' The core issue lies in the cost disparity: 'We are struggling to add capacity or compete with batteries coming from third countries like China when the cost of batteries there is around 50% less than the cost in Europe.' Europe's battery manufacturing industry is under mounting pressure as it struggles to compete with significantly cheaper imports from China, raising concerns over the bloc's ability to sustain a domestic supply chain for electric vehicles. This price gap is proving detrimental to the viability of European battery producers. 'This is making our battery industry incapable of surviving,' she added, underscoring the urgency for a comprehensive strategy to bolster the sector. The call is not only for increased production but also for a systemic approach to stimulate internal demand and competitiveness. 'We need to look at the whole battery chain, how to increase internal demand and make it competitive without negatively impacting end-user prices,' she said. The goal, she stressed, is to ensure consumers are not forced to 'pay more for European batteries' while still encouraging the use of 'those that are more sustainable and better sourced.' Good signs on the horizon Sara Matthieu, another Green MEP on the committee from Belgium who was involved in the act's negotiations in the parliament, said at the event that there are good signs so far that the act is working. 'We can see from what the Commission has published that for Lithium, for instance, if all projects go ahead as planned, we would reach the recycling benchmark, and even 80% of self-sufficiency when it comes to extraction.' 'When you look at cobalt, we would actually surpass the recycling benchmark but not for extraction and processing. And on rare earths, there's only good news for processing. So it's quite a mixed picture, and in any case, these are the best-case scenarios; it could occur that not all of these projects make it.' 'We also need to focus on demand management,' she added. 'There's been a lot of focus on extraction. Yes, we will need more, but the question for me is really how much and what kind of impact is that going to have?' Matthieu remarked, 'For mobility, for instance, if you invest in public transport and shared e-mobility, that could really drastically moderate the increase in demand. The act actually contains a clause to develop a clause for demand moderation, so I'm wondering if the Commission has actually worked on that yet.' Complicated geopolitics The speakers at the event also discussed the complicated geopolitical situation which makes the EU's dependence on third countries for raw materials imports precarious. The 2024 Draghi Report, commissioned by the European Commission, paints a stark picture of Europe's supply chain vulnerabilities. It emphasised that Europe's reliance on imported raw materials exposes its EV industry to significant risks, including price volatility, supply disruptions, and geopolitical dependencies. The report highlights that current European domestic extraction and processing capacities for critical minerals are insufficient to meet the growing demand projected for the coming decades. 'China has a competitive advantage simply out of the fact that these days China is one of the most mature markets when it comes to EV batteries, so there are the amounts available to recycle,' noted Mistry. 'What we need to make sure is that the materials that we put on the market here in Europe stay within the EU and are available for European recycling facilities. We see within our member companies that they start preparing or they're already active in recycling.' The Competitiveness Compass put forward by the European Commission earlier this year reported that Europe is starting to lag behind emerging global hubs on EV manufacturing, particularly China, the United States, and parts of Latin America, and that part of the reason is those countries have heavily invested in raw material processing and battery manufacturing capacity. The competitiveness gap could lead to increased import reliance, stranded investments, and diminished economic benefits from the EV supply chain, the compass warned. [Edited By Brian Maguire | Euractiv's Advocacy Lab ]
TimesLIVE
08-07-2025
- Automotive
- TimesLIVE
Abandoning EU's 2035 zero-emission car target would risk one million jobs
Europe's car industry could return to producing 16.8-million cars a year, equalling its post-2008 crisis peak, if the EU maintains its 2035 clean cars target and implements policies to support the transition, a study published by campaign group Transport & Environment (T & E) showed on Tuesday. Conversely, deploying no industrial strategy and going back on the 2035 target that all new cars and vans sold in the EU no longer emit carbon dioxide could result in a loss of one million auto industry jobs and two-thirds of planned battery investments, T&E said. Challenged by high costs in their home markets and a gap to Chinese and US rivals in the electric vehicle industry, European carmakers face the effects of US President Donald Trump's 25% tariffs on car imports, which have pushed many manufacturers to pull their forecasts for 2025. After heavy lobbying, the European Parliament gave its backing to softening some EU CO2 emissions targets for cars and vans in May, but it has so far stuck to regulations that will bar the sale of fossil-fuel cars by 2035. "It's a make or break moment for Europe's automotive industry as the global competition to lead the production of electric cars, batteries and chargers is immense," said Julia Poliscanova, senior director for vehicles and emobility supply chains at T&E. If the 2035 goal is maintained and policies to boost domestic EV production are implemented, the automotive value chain's contribution to the European economy would grow 11% by 2035, the advocacy group said. Job displacement in vehicle manufacturing could be offset by the creation of more than 100,000 jobs in battery making by 2030 and 120,000 in charging by 2035, it added.
Time of India
08-07-2025
- Automotive
- Time of India
Abandoning EU's 2035 zero-emission car target would risk 1 million jobs, study says
Europe's car industry could return to producing 16.8 million cars a year, equalling its post-2008 crisis peak, if the European Union maintains its 2035 clean cars target and implements policies to support the transition, a study published by campaign group Transport & Environment showed on Tuesday. Conversely, deploying no industrial strategy and going back on the 2035 target that all new cars and vans sold in the EU no longer emit carbon dioxide could result in a loss of 1 million auto industry jobs and two-thirds of planned battery investments, T&E said in a statement. WHY IT'S IMPORTANT Already challenged by high costs in their home markets and a gap to Chinese and U.S. rivals in the electric vehicle industry, European carmakers now face the effects of U.S. President Donald Trump's 25% tariffs on auto imports, which have pushed many manufacturers to pull their forecasts for 2025. Following heavy lobbying, the European Parliament gave its backing to a softening some of the EU CO2 emissions targets for cars and vans in May, but it has so far stuck the regulations that will bar the sale of fossil-fuel cars by 2035. KEY QUOTES "It's a make or break moment for Europe's automotive industry as the global competition to lead the production of electric cars, batteries and chargers is immense," Julia Poliscanova, Senior Director for Vehicles & Emobility Supply Chains at T&E, said in the statement. BY THE NUMBERS If the 2035 goal is maintained and policies to boost domestic EV production are implemented, the automotive value chain's contribution to the European economy would grow 11% by 2035, the advocacy group said. Job displacement in vehicle manufacturing could be offset by the creation of more than 100,000 jobs in battery making by 2030 and 120,000 in charging by 2035, it added. Weakening the goal alongside lack of comprehensive industrial policies meanwhile could slash the value chain's contribution by 90 billion euros ($105.5 billion) by 2035.
Euractiv
02-07-2025
- Business
- Euractiv
What a 90% emissions cut could mean for EU citizens
The EU's 2040 climate goal is likely to affect Europeans' wallets – and those of the companies they work for. Whether a 90% reduction in Europe's greenhouse gas emissions compared to 1990 levels will bring net costs or benefits for workers, households, and industry depends on how EU leaders choose to implement the target – if they agree to it at all. That decision comes as the European Commission shifts its focus increasingly toward competitiveness and lowering energy prices. In recent months, calls have mounted to roll back landmark policies like the 2035 phase-out of petrol and diesel cars, or to weaken key measures by outsourcing climate action through international carbon credits, or by capping the price polluters must pay for emitting CO2. This is despite mounting evidence that failing to act on climate could ultimately cost more – and undermine crucial price signals meant to steer companies toward cleaner technologies like electrification, sustainable fuels, and carbon capture and storage. Rising costs Transport remains the only EU sector where emissions have increased since the 1990s. It is also where the public is most likely to feel the cost of the green transition first-hand – even as more affordable electric cars enter the market. Business travellers and tourists, for instance, could see airfares rise as airlines begin passing on the cost of sustainable jet fuel mandates to consumers. Fully decarbonising European aviation by 2050 is expected to cost €2.4 trillion in investment, according to the lobby group Airlines for Europe. The NGO umbrella group Transport and Environment (T&E) warns that by 2030, the transport sector could account for up to 45% of the EU's total emissions – making its transformation critical to meeting climate targets. Likewise, renovating Europe's poorly insulated homes and replacing gas boilers with efficient heat pumps will bring significant upfront costs for many households, even as these measures aim to reduce emissions and long-term energy bills. The other side of the balance sheet Still, the EU's push to decarbonise energy through renewables is expected to lower energy bills over time and reduce the bloc's reliance on imported fossil fuels – potentially freeing up billions for strategic investments. According to T&E, the European Commission's own modelling suggests a 90% reduction pathway would cut the EU's oil bill by $75-100 billion a year. Failing to act, on the other hand, carries indirect but massive economic risks amid rising global temperatures. 'Over the period 2031-2050, the cumulative additional GDP cost of a pathway leading to worse global warming could amount to €2.4 trillion in the EU, compared to the costs under a pathway compatible with the 1.5°C objective of the Paris Agreement,' the European Commission said last year. And EU citizens are already paying the price for 'extreme weather events that are accelerated by climate change', consumer organisation BEUC told Euractiv. Making it happen How the costs and benefits of the 2040 target will be distributed depends largely on how Brussels acts – and how national governments respond. Some core legislation is already in place, including a new carbon price on heating and transport fuels. To cushion the impact, especially for low-income households and small businesses, the law includes a Social Climate Fund to recycle revenues back to vulnerable groups But this week, 26 out of 27 national governments missed the deadline to submit the national plans needed to activate the fund. More broadly, any backtracking on climate policies could derail the price signals these mechanisms are designed to send to the private sector – frustrating many businesses that see the green transition as a strategic opportunity, not a burden. The risk of being too flexible The European Commission is expected to allow the use of international carbon credits to meet the yet-to-be-confirmed 90% target. This means investing in climate-friendly projects abroad – like tree planting in developing countries – and counting the resulting emissions savings toward Europe's target. Proponents argue this could cut the costs of the green transition. Critics – including some promoters of carbon capture and storage technology as well as highly sceptical environmental campaigners – say it would undermine incentives to cut emissions in Europe and delay the development of clean technologies more generally. 'The EU's cleantech industry experiences the greatest benefits when EU climate investments are made in Europe – not abroad. Why should we outsource the benefits that the energy transition provides to countries outside of the EU,' the socialist lawmaker Mohammed Chahim asked. Greenpeace's Thomas Gelin echoed this message: 'With an effectively lower domestic target, there will be less impetus for businesses and communities in Europe to implement the solutions we need.' (de)
