What The European Green Deal Means For Businesses
What’s happening? The European Commission unveiled the European Green Deal, which re-evaluates almost every aspect of the European economy in an effort to combat climate change. In addition to a target of net-zero carbon emissions by 2050, and a 50% reduction in emissions by 2030, the deal would set standards on goods manufacturing, designed to establish a circular economy, while phasing out plastic and waste before it is produced.
Why does this matter? Less of a deal, and more of a “European Green Paradigm Shift”, the proposal from Ursula von der Leyen’s Commission has the potential to change the way companies operate in every business sector across the continent. Every major European law and regulation is going to be revised by March 2021 to align with the climate goal. Hitting carbon neutrality in 30 years will mean transforming Europe’s entire economy.
There are a number of business areas that will thrive if the vision is enacted:
Already setting low electricity cost records faster than many predicted, there is abundant offshore wind potential in the North Sea and elsewhere in Europe, for example off the coast of France and Spain. As part of the deal the Commission will unveil a new offshore wind strategy next year, and states the large-scale, low-carbon technology will be essential for the bloc to meet its carbon neutrality target.
A key component in making Europe’s steel industry clean, hydrogen in Europe could be a €820bn ($912bn) a year market by 2050. Climate Home News quotes an EU official stating green hydrogen – created using electrolysis powered by renewable energy – needs to be in place by 2030, as this is the last investment cycle if the EU’s industry is to be fully decarbonised by 2050.
Advanced batteries and vehicle charging infrastructure
To help decarbonise the transport sector (no small task) EVs are a key element, and, under the proposals, the Commission will legislate next year to make the batteries they run on reusable and recyclable. It has also recently approved measures to promote cell production in the EU. It wants new vehicles to emit zero emissions “sometime in the 2030s” and will launch funding calls for public EV charging infrastructure.
Companies that are smart with waste
The circular economy is being billed as the number one priority of the deal, and one that will account for half of the emissions reduction to 2050. Eco-design regulations are starting to ensure products are easier to recycle, and the Commission wants to increase the market in secondary raw materials. The aim is to link the benefits of circular economics to demonstrated reductions in carbon dioxide.
The Green Deal is by no means set in its current form as member states start negotiating, and Poland is refusing to commit to the carbon neutrality goal, despite the proposed €100bn “Just Transition Mechanism” aimed to help member states that have a tougher job ahead of them to decarbonise.
But, despite member state squabbles, it does indicate the direction of travel in Brussels.
Nick Finegold is Founder & CEO of Curation Corp, an emerging and peripheral risks monitoring service.
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