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The Future of Europe and the Future of Climate Action

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Jonathan Gaventa, E3G

PLACARD foresight workshop, facing the future of Europe’s climate – EU governance and climate risks at a crossroads

11–12 December 2018, European Commission, Brussels

The second PLACARD Foresight workshop showcased the potential of foresight methods in increasing climate resilience across Europe. Within the workshop we explored how Juncker’s “5 futures of Europe” can be used for assessing climate and DRR risks in Europe, and for designing and characterising effective response strategies, for three cases (heat and drought, fluvial flooding, coastal impacts).

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The Future of Europe and the Future of Climate Action

  1. 1. E3G The Future of Europe and the Future of Climate Action Jonathan Gaventa, E3G 11 December 2018 1
  2. 2. Overview • EU leaders have embarked on a “Future of Europe” discussion on the future form, capacity and focus of the EU. • Climate change matters for the Future of Europe. Europe’s prosperity depends on successfully managing climate risk and an orderly transition to a zero carbon economy. • The future form and capacity of the European Union will fundamentally shape Europe’s ability to respond effectively to climate risks and impacts and to guide the transition. • This presentation outlines scenarios for the ‘Future of Europe’ and explores their implications for European climate governance. E3G 2
  3. 3. Climate challenges for the Future of Europe E3G 3 The challenges of managing climate impacts and transitioning to a climate neutral economy intersect with existing governance challenges facing the EU. Eg: - Differential climate impacts risk exacerbating existing inequalities in the EU: North vs South, rich vs poor, insured vs uninsured. - The need to move to a fully climate neutral EU requires transformation in every sector of the economy; traditional policy approaches relying on effort sharing and marginal abatement costs may be less suitable. Yet strategies may vary between EU, national and local levels. - Investment needs for resilience and decarbonisation may conflict with pressures for fiscal discipline within European economic governance.
  4. 4. Future of Europe Timeline September 2016: Bratislava Declaration March 2017: Rome Declaration March 2017: Future of Europe White Paper May-December 2017: thematic reflection papers: social dimension, harnessing globalisation, economic and monetary union, defence, EU finances October 2017: Start of European Council “Leaders Agenda” November 2018: Strategic vision on a climate neutral Europe Ongoing: citizens dialogue on Future of Europe May 2019: Sibiu summit on Future of Europe E3G 4
  5. 5. Recommended reading European Commission: White Paper on the Future of Europe, March 2017 E3G, IEEP, Heinrich Boll Stiftung: The Future of Europe and the Future of Climate Action, November 2017 E3G 5
  6. 6. 5 Scenarios for the Future of Europe Scenario 1: Carrying On “The EU27 focuses on delivering its positive reform agenda” Scenario 2: Nothing but the Single Market “The EU27 is gradually re-centred on the single market” Scenario 3: Those Who Want More Do More “The EU27 allows willing Member States to do more together in specific areas” Scenario 4: Doing Less More Efficiently “The EU27 focuses on delivering more and faster in selected policy areas, while doing less elsewhere” Scenario 5: Doing Much More Together “Member States decide to do much more together across all policy areas” E3G 6
  7. 7. Today’s discussion will focus on 3 scenarios Scenario 1: Carrying On “The EU27 focuses on delivering its positive reform agenda” Scenario 2: Nothing but the Single Market “The EU27 is gradually re-centred on the single market” Scenario 3: Those Who Want More Do More “The EU27 allows willing Member States to do more together in specific areas” Scenario 4: Doing Less More Efficiently “The EU27 focuses on delivering more and faster in selected policy areas, while doing less elsewhere” Scenario 5: Doing Much More Together “Member States decide to do much more together across all policy areas” E3G 7
  8. 8. Scenario 2: Nothing but the single market Upsides for climate action? Strengthening single market rules could challenge high carbon incumbents, for example by preventing capacity payments fossil power plant. A more closely integrated internal energy market could facilitate trade renewables. Once initiated, disruptive low carbon technologies could spread more easily. In practice climate upsides from this scenario are likely to be limited. Downsides for climate action? Likely push for deregulation and a roll back of climate policy. Risk a “race to the bottom” on environmental standards, and a regulatory gap emerges at EU level. Targets are weakened or ignored, and there is growing divergence between countries. Limited ‘solidarity’ in investing in resilience or responding to climate disasters. E3G 8 Description - The EU scales back its ambition to only focusing on the single market. - There is a strong focus on reducing regulation at EU level. - There is little appetite to expand policy into new areas.
  9. 9. Scenario 3: Those who want more do more Upsides for climate action? This scenario provides a clear opportunity to bank increased climate ambition rather than making everyone go at the same pace. Countries such as France and Sweden who have signalled their intention to raise climate ambition would be able to do so, and such actions could be additional to current efforts. Cross-border initiatives on developing low carbon resources, such as the North Seas Grid initiative, are formalised and expanded. Downsides for climate action? Further loss of consistency on climate and clean energy policy across Europe. This may include widening gaps on climate resilience. Further divergence in climate policies would also puts internal energy market under even greater strain and challenges notions of EU solidarity. Countries who are lagging behind feel empowered to do even less on climate. E3G 9 Description - A ‘multi-speed’ Europe where one or several “coalitions of the willing” emerge to work together in specific policy areas. - This includes instituting legal or budgetary arrangements in these domains (cf Schengen and the Eurozone). Other member states have the opportunity of joining over time.
  10. 10. Scenario 5: Doing much more together Upsides for climate action? EU could expand its remit on climate action into new areas, for example on low carbon industrial strategy, and supporting communities most exposed to climate impacts. The international role of the EU on climate change also strengthens: “the EU27 continues to lead the global fight against climate change and strengthens its role as the world’s largest humanitarian and development aid donor”. Downsides for climate action? No indication is given on how agreement will be reached, given existing divisions in EU climate politics. E3G 10 Description - Considerable expansion in EU capacities and remit. - “There is consensus that neither the EU27 as it is, nor European countries on their own, are well-equipped enough to face the challenges of the day”. - “Cooperation between all Member States goes further than ever before in all domains”.
  11. 11. Conclusions • There are important questions to be addressed about future EU capacity both to guide the low carbon transition and respond to climate risk. • Climate change should be central to Future of Europe discussions but has so far been treated at arms length. The ‘Sibiu’ summit of European leaders in 2019 gives an important opportunity to build climate resilience and climate neutrality into EU priorities. • Future governance models cannot be assumed to be fixed. Governance capacity will be a key element in future climate resilience capabilities. E3G 11
  12. 12. Annex: Additional Scenarios E3G 12
  13. 13. Scenario 1: Carrying on Upsides for climate action? EU maintains its international role on climate change (but hampered by domestic disagreements over the level of ambition) Continued incremental (but not transformational) modernisation of energy markets, which gradually opens the door to higher proportions of renewables, active demand and digital technologies. Some member states drive forward their own climate ambitions in parallel to the EU targets; others stick to bare minimum. Downsides for climate action? The EU struggles to increase its climate targets in line with Paris Agreement – with widening divisions between actors. Markets in clean energy technologies grow in the EU, but the EU fails to implement a cohesive low-carbon industrial strategy. Disruption to high-carbon industries (driven by technological and demographic change as well as climate policy) with no clear transition plans lead to backlash against climate action in some part of the EU. E3G 13 Description - EU-27 stick to their current course. - Efforts focus on strengthening the single market and increasing investment, including in areas such as energy infrastructure and digital. - No major change of direction in terms of governance or focus.
  14. 14. Scenario 4: Doing less more efficiently Upsides for climate action? Climate is a fundamentally cross-border issue with clear EU added value, so could see greater focus. Doing things ‘more efficiently’ is almost by definition a good thing – in climate and other fields. Downsides for climate action? Doing less could include doing less on climate and clean energy. Although better enforced, ‘common standards are set to a minimum’. The EU may be less likely to set ambitious standards for efficient products, vehicles and buildings. Rolling back action on regional development means the EU is less able to respond to the social challenges of the clean energy transition and climate adaptation. E3G 14 Description - EU scales back its focus to a limited number of policy areas, but it becomes more effective at reaching agreement and delivering on stated goals. - In this scenario the EU steps away from areas in which its added value or competencies are limited (regional development, public health, social policy and state aid listed as examples)
  15. 15. E3G About E3G E3G is an independent climate change think tank operating to accelerate the global transition to a low carbon economy. E3G builds cross-sectoral coalitions to achieve carefully defined outcomes, chosen for their capacity to leverage change. E3G works closely with like-minded partners in government, politics, business, civil society, science, the media, public interest foundations and elsewhere. More information is available at www.e3g.org 15

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