The proposal by the EU Commission to classify, subject to requirements, natural gas and nuclear energy as "green" to provide private investors with guidance on the financial market, was met with plenty of resistance over recent months. However, at the vote on 6 July 2022, the EU Parliament did not veto the proposal. As a result and in accordance with the Taxonomy Regulation, investments in gas and nuclear energy will be classified as sustainable from January 2023 – provided they fulfil the requirements.
After the decision in the EU Parliament, many Austrian politicians across all parties and civil society representatives were dismayed by the decision to classify gas and nuclear energy as climate-friendly. The SPÖ MEPs Evelyn Regner and Günther Sidl, regretted the outcome of the vote: "It was and is still clear for us that there must be no greenwashing of past fossil technologies. However, classifying nuclear energy and gas as sustainable within the scope of Taxonomy is greenwashing par excellence!". The Green MEP Thomas Waitz agreed that the vote was a major setback for climate protection in the EU. The new Taxonomy amounted to “fraudulent labelling“, which in contrast to scientific findings had been put through due to a lot of lobbying. At a press conference shortly before the vote , a cross-party coalition of MEPs criticised the strong lobbying in favour of this delegated legal act on Taxonomy, which had also been operated by Russian state-controlled energy companies Gazprom and Rosneft.
It shall only be possible to classify investments in new nuclear power plants as ‘green’ when the plants fulfil the latest technical standards. This includes the “safe” disposal of nuclear waste. Another condition is that the new nuclear power plants will have obtained a construction permit by 2045. Apart from that, investments in new gas power plants may temporarily be classified as ‘green’, whereby the amount of greenhouse gas emissions is the relevant factor here: for plants, which are approved after 31 December 2030, life-cycle based emissions shall not exceed 100g CO2e/kWh, whereby the value in case of Austrian gas power plants is currently above 300. Gas plants may operate until 2030: however, it is not clear what will happen after 2030, as the technology for these ”green“ gas plants does currently not exist.
Commission ignored important arguments
The Commission’s consultation process attracted substantial criticism right from the start: The Platform on Sustainable Finance, which represents Think Tanks and NGOs, was to advise the Commission on Taxonomy, and arrived at a clear assessment of the Commission proposal: the criteria and act proposed were not in line with the original targets of the Taxonomy Regulation; in particular, the requirements do not fulfil the “Do No Significant Harm“ principle. Gas does not make a significant contribution to climate protection and nuclear energy bears the risk that other environmental targets will suffer significant damage, the latter is also stated in a legal opinion from Germany. However, when the Platform and NGOs made their statement shortly before the end of 2021, the Commission announced that it would accept the legal act only a few days later, under consideration of a specifically requested expert opinion. Interestingly enough, the copyright of this expert opinion for the Commission belongs to the European Atomic Energy Community EURATOM.
Is it possible to still halt the proposal?
The EU Parliament had been regarded as the last big hurdle for the Taxonomy project, as a possibility to overturn it in the Council is regarded as being hopeless: 20 of 27 countries would have to cast a No-vote, otherwise the proposal will come into force in 2023. Austria and Luxembourg belong to the small number of countries within the Council, which have adopted a clear position against the delegated legal act. In addition, they have already announced that they would take legal action against Taxonomy. According to Minister Leonore Gewessler, Austria intends to lodge the already prepared action for annulment with the European Court of Justice, as soon as this "greenwashing programme" comes into force: "We shall use the coming weeks and months to gain further allies." Some MEPs, but also environmental organisations such as Greenpeace, Climate Earth and “Atomstopp” announced that further legal remedies would be examined.