The European Commission is set to include natural gas and nuclear power in its taxonomy for what qualifies as sustainable finance, in order to get EU member states that support these energy sources on board with its climate agenda, the Financial Times reported on November 3 citing sources.
The EU taxonomy is designed to help companies, investors and policymakers decide what can and cannot be considered environmentally sustainable economic activities, and avoid support for greenwashing.
According to FT, the European Commission is drafting a taxonomy text that will «open the door for nuclear power to be awarded the highest green label under the rules.» Europe is divided over nuclear power, which while not emitting CO2, produces toxic waste and is seen by some as a danger post-Fukushima. While France wants to maintain its nuclear capacity, Germany is shutting down its plants.
The FT notes that «natural gas … will also be included in the draft to win support from countries in east and south Europe which have demanded that gas is not penalised.»
A number of east and south EU member states have positioned gas as a central part of their transition plans. Poland, which for years defended its coal industry from EU criticism, has now embraced gas as a substitute. It is developing several new gas import projects, and is building new gas power plants.
The European Commission’s inclusion of gas and power comes as the energy crisis in Europe has exposed a divide between member states’ views on the energy transition. Characterising the opposition to a fast-tracked transition, Hungarian prime minister Viktor Orban in late October accused the commission of having a «utopian fantasy,» warning that EU climate policies would cause energy prices to spike and «kill» Europe’s middle class.