EUROPE: The European Commission answers questions about the 2040 climate target

The European Union is embarking on an ambitious journey to become the first climate-neutral continent by 2050, with a significant milestone set for 2040.

The EU Climate Law mandates a reduction of net greenhouse gas (GHG) emissions by at least 55% by 2030 and necessitates the establishment of an intermediate target for 2040. The European Commission has proposed a 90% reduction in net GHG emissions by 2040. This initiative not only aims to align with the Paris Agreement commitments but also to stimulate a comprehensive political debate and stakeholder dialogue on achieving climate neutrality.

The Commission’s recommendation is underpinned by a detailed impact assessment exploring pathways to attain this climate neutrality. The assessment emphasises the importance of timely setting targets to facilitate the necessary policy and investment decisions that would transition the EU towards a resilient economy, characterized by competitive industries, future-proof jobs, and sustainable energy solutions. The EU’s role on the international stage is crucial, as the 2040 climate target will form the basis of a new Nationally Determined Contribution under the Paris Agreement, urging other global partners to adopt similar ambitious measures.

Achieving a 90% emissions reduction by 2040 requires a multi-faceted approach, including the full implementation of the agreed 2030 framework and a focus on a just transition that leaves no one behind. The energy sector, particularly through renewables, nuclear, and bio-energy, alongside energy efficiency and carbon capture technologies, is pivotal in driving this decarbonisation. The Commission highlights the ongoing progress in renewable energy deployment and the importance of reducing fossil fuel consumption by 2040.

The economic implications of setting a 2040 target are profound, offering predictability and confidence for businesses, public authorities, and citizens to make informed investment and policy decisions. This proactive approach aims to prevent wasteful resource allocation and promote investments in clean technologies, thereby enhancing the EU’s competitiveness in the clean tech sector and reducing reliance on imported fossil fuels.

For European citizens, the transition to climate neutrality signifies a shift towards a more sustainable, healthy, and prosperous society. The reduction in GHG emissions and fossil fuel use will have direct benefits on air quality, health, and the environment, fostering a fair transition that benefits all. Investment in clean energy, efficient buildings, and sustainable transport will create new business opportunities and jobs, contributing to a robust economy.

The investments required to achieve the 2040 target are substantial, necessitating a blend of private and public sector funding. The Commission estimates an annual increase in investment in the energy system and transport sector, highlighting the need for a supportive policy framework to attract these investments. This comprehensive investment strategy will enable the EU to lead in the global transition to a sustainable future, ensuring economic resilience and environmental sustainability.

11 September 2024

Government urged to act after four more tax avoidance schemes identified

As reported in LondonLovesBisiness.com on wednesday 11 September, HMRC has added four more tax avoidance schemes to its list of known avoidance promoters. The update, issued on 5 September, should

Read More
13 December 2024

GLOBAL TAX: Wealth tax will raise revenue without burdening lower-income groups, say activists

A wealth tax is an effective way of raising much-needed revenue without imposing additional tax burdens on middle and low-income groups, says an alliance of Asian activist groups calling for the tax

Read More
19 July 2025

UK: HMRC does not know how many billionaires pay tax in the UK

PAC warns of lack of clarity over how much tax is paid or avoided by the very wealthy, as report highlights significant opportunities to collect more revenue. Public Accounts CommitteeHM Revenue &

Read More
26 July 2024

Former Sky News Editor and Formula 1 Team Head to Share Insights at Jersey Finance Flagship Conference

Press Release from Jersey Finance, Monday 8 July, 2024.  A former renowned diplomatic editor for Sky News and one of the most successful women in Formula 1 history are to take to the stage at this

Read More