The Nordic business federations of Finland, Iceland, Norway and Sweden are deeply concerned by the delegated Regulation on the EU’s environmental objectives for climate change mitigation and adaptation under the ‘Taxonomy’. We find that it will undermine ours, and Europe’s, ability to reach our climate goals.
The Nordic business federations of Finland, Iceland, Norway and Sweden are committed to the EU’s ambition of reaching carbon neutrality by 2050. While policies set the course and define the climate-neutral ambitions, the private sector will largely be responsible for delivering the required capital, technologies, solutions, products, and innovations needed to achieve such far-reaching goals.
We are deeply concerned by the delegated Regulation on the EU’s environmental objectives for climate change mitigation and adaptation under the ‘Taxonomy’. We also find that it will undermine ours, and Europe’s, ability to reach our climate goals.
The increased electrification of our communities will be vital in delivering effective approaches for fighting climate change. It is therefore worrying that the carbon-neutral electricity generated from large scale hydropower risks being classified as unsustainable in the taxonomy. This could drive up capital costs for fossil-free hydropower and companies that rely on hydropower for their production will be perceived as generally less sustainable by investors. The Nordic large scale hydropower is a flexible energy source and is an important enabler for the expansion of intermittent renewable energy, such as wind and solar power in other parts of northern Europe.
We are also concerned that the technical criteria in the Taxonomy will undoubtedly disadvantage the use of biofuels, which can play an important role to reach climate neutrality and reduce the use of fossil fuels.
Therefore we urge the EU governments, as well as the European Commission and the European Parliament, to act swiftly and decisively. It is vital that they ensure that the existing competitiveness of business and industry is not undermined, weakening the capacity to address the challenges of climate change as a result. These are our main objections:
– The increased electrification of our communities will be vital in delivering effective approaches for fighting climate change. The Nordic business federations from Finland, Iceland, Norway and Sweden are therefore deeply concerned by the fact that the carbon-neutral electricity generated from large scale hydropower risks being classified as unsustainable in the taxonomy.
– This will drive up capital costs for fossil-free hydro power and companies that rely on hydropower for their production will be perceived as generally less sustainable by investors. The Nordic large scale hydropower is a flexible energy source. It is therefore an important enabler for the expansion of intermittent renewable energy such as wind and solar power in other parts of northern Europe.
– The fact that zero-emission forms of electricity production are treated differently, ie. the proposition is not technology-neutral. Techno- neutrality, be it renewables, nuclear, the use of CCUS or any carbon-free technologies, is imperative for a cost efficient path to carbon neutrality and well-functioning markets.
– We are also concerned that the technical criteria’s in the taxonomy will undoubtedly disadvantage the use of biofuels which can play an important role to reach climate neutrality and reduce the use of fossil fuels.
– Consequently, we believe that the proposal will undermine ours, and Europe’s, ability to reach our climate goals. It also risks damaging the competitiveness of European industry and ultimately leading to an overall increase in global CO2 emissions.