Money, money, money
Back in April 2020, the EU found itself facing not just a severe health crisis but an economic one, too. The deepest recession since the second world war pushed a number of highly indebted countries on the brink of debt default, and posed an existential risk to the Union. Coerced into solidarity, heads of state decided to launch a massive stimulus plan and use Brussels’ institutions to foot part of the bill for the crisis. Next Generation EU - the union’s recovery plan - was announced, including a whopping €600 billion of ‘climate spending’ for the next seven years. If spent correctly, this would enable Europe to accelerate its transition towards a zero-emission mobility system.
With Next Generation EU dwarfing pretty much everything else in finance, the launch early in the year of the taxonomy regulation - the world’s most advanced set of rules for green finance - went somewhat unnoticed. T&E played a major role in shaping the regulation that establishes what banks and investment funds can call 'green', in favour of zero-emissions vehicles. From 2026 only zero-tailpipe emissions vehicles can be defined as sustainable. For trucks the regulation is even stricter, allowing only zero-emission or low-emissions trucks to be labelled green (ruling out almost all of the models commercially available today).
The taxonomy regulation was eclipsed however by the EU’s Covid-recovery package. Although €600 billion was earmarked for green spending, the operational guidelines remained quite vague, leaving the door open for greenwashing. As a consequence, the handful of member states that would receive more than 50% of the funds (Italy, Spain, France and Poland) were given the possibility to invest so called green funds in a number of polluting activities, such as gas powered energy, biofuels and more.
To ensure the recovery fund is truly green, T&E led an EU-wide campaign for a green and just recovery that was endorsed by 130 NGOs and 1.3 million people. As a result the EU increased the green share of the €2 trillion stimulus package and the seven-year budget from 25% to 30%. Most notably, the share of the Recovery and Resilience Facility was increased to 37%, dedicating a whopping €250 billion to climate-friendly investments in just 2 years, making it the world's largest ever green stimulus package.
T&E appointed to the Platform for Sustainable Finance
In recognition of its work and expertise, T&E was appointed by the European Commission as a member of the expert group, the Platform for Sustainable Finance. The group defines the sustainability criteria for the financial industry. T&E holds one of 30 seats in the technical working group and leads the 10 experts in the transport sector team.
A once in a generation opportunity
2020 was a difficult year for everyone but recovery spending offers a major opportunity to green Europe’s economy. T&E will fight to ensure that this means cleaning up the transport and energy sector.