How the next EU budget will tackle climate change



Kate Abnett | Reuters

BRUSSELS (Reuters) – EU leaders meet in Brussels on Thursday to haggle over the bloc’s next seven-year budget, a hole of up to 80 billion euros (66.8 billion pounds) created by Brexit, and the need to finance initiatives including the 1 trillion euro European Green Deal.

Here are the key climate change elements of the 2021-27 budget proposal that European Council President Charles Michel has put on the table as a starting point for the 27 leaders:


Michel wants at least a quarter of 2021-27 spending to further climate goals, including the ultimate ambition to make the EU “climate neutral” by 2050. That would equate to 274 billion of his proposed total budget of 1.095 trillion euros – an increase from the 2014-20 budget, in which 20% of spending was earmarked for climate.

Michel also wants all EU spending to be consistent with the Paris Agreement goals which aim to cap global warming at 1.5 degrees Celsius above pre-industrial levels this century.


Michel’s proposal sets aside 7.5 billion euros for a “Just Transition Fund” to help emissions-intensive regions and sectors shift away from fossil fuels. But this comes with a caveat: member states that have not signed up to a national objective of climate neutrality by 2050 will only get half of their share.

This is aimed at Poland, the only member state that refused to commit to the 2050 climate neutrality goal at an EU summit in December but which had been set to get 2 billion euros of the 7.5 billion on offer, making it by far the biggest beneficiary.


Agriculture spending would become greener as Michel wants 40% of the Common Agricultural Policy (CAP) budget to be dedicated to climate action. The CAP would make up nearly a third of the total 2021-27 budget under Michel’s proposal.

To deliver this, the EU will launch a “new environmental architecture” for farming subsidies, while rural development projects with a climate angle will get access to a higher co-financing rate from the bloc.


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