EU Taxonomy: Environmental groups start legal action against ‘sustainable’ gas classification

ClientEarth, WWF’s European Policy Office, Transport & Environment (T&E), and BUND (Friends of the Earth Germany) are starting legal action to prevent fossil gas from featuring in the EU’s sustainable finance Taxonomy.

The Taxonomy’s Complementary Delegated Act (CDA), adopted controversially before the summer, gives gas a ‘sustainable’ label. 

The groups argue the CDA clashes with other EU laws, in particular the Taxonomy Regulation itself and the European Climate Law. It also does not respect the EU’s obligations under the Paris Agreement.

Gas is responsible for sky-high energy bills across Europe. It also has detrimental impacts on the environment – including the release of vast amounts of carbon and methane emissions. 

This label risks channelling investments into this harmful energy source, away from genuinely sustainable sources of energy like homegrown renewables – and skilfully reducing demand in the first place. 

A spokesperson for ClientEarth, WWF European Policy Office, T&E and BUND said: “Propping up gas, a fossil fuel which is currently at the centre of a cost of living crisisacross the bloc, undermines the EU’s fundamental aims of achieving cleaner, cheaper and more secure energy. To bring down people’s bills, secure energy supplies and protect citizens from climate chaos, the EU needs to stop greenwashing gas as ‘sustainable’ in the EU Taxonomy.

“The Taxonomy is supposed to be the gold standard for investments but, as it stands, this Taxonomy Act sends all the wrong signals to investors. It needs to be repealed.”

The groups have been able to commence legal action through a request for internal review – a mechanism now open for use by NGOs and the public after amajor reform of EU access to justice laws last year.

The groups request the EU Commission to repeal the Complementary Delegated Act. The European Commission now has up to 22 weeks to reply. If the Commission refuses, the groups will be able to ask the Court of Justice of the EU to rule.

The desired end result could be a judgement that forces the Commission to repeal the Complementary Delegated Act.

Notes to editors 

What is the legal procedure used in this case?

In 2021,a landmark reform of EU access to justice laws was approved. This has lifted the main barriers preventing NGOs and people from challenging environmental wrongdoings in court.

Environmental NGOs now have the right to ask EU institutions and bodies – in this case the European Commission – to review one of their own decisions for contravening EU law related to the environment. The Commission must officially reply to such a request within 16 weeks, a deadline that can be extended up to 22 weeks. If the claimants find that the Commission’s reply does not fix the legal violation, the claimants can sue the Commission in the Court of Justice of the European Union.

What are the climate impacts of gas and methane?

Gas extraction and transportation not only emitshuge amounts of CO2, it is also a big emitter of potent and poisonous greenhouse gas methane, which is a whopping86 times more powerful than carbon dioxide in terms of climate change over 20 years. Methane is emitted through the drilling and extraction of gas from wells and its transit through pipelines. Beyond climate,methane also has devastating impacts on human health – via air pollution – and ecosystems.

Both the IEA and the IPCC have clearly saidno new oil and gas extraction projects should be commenced if we are to keep warming within 1.5C. Additionally, arecent study found that nearly half of existing fossil fuel production sites need to be shut down early if 1.5C is to be achieved.

Why does the legal action brought by ClientEarth, WWF EPO, T&E and BUND not cover nuclear? 

We lack the technical and legal expertise to be able to challenge the inclusion of nuclear-based activities in the CDA.