Analysis of Europe’s 2030 Climate Ambition

Currently, the CO 2 emissions and removals from agriculture and land use, land use change and forestry
(LULUCF) are excluded from EU’s 2020 climate target. However, in order to tackle climate change all
sectors should contribute to the mitigation efforts in the future, including the climate impact of the
agriculture and the LULUCF sector. The Heads of State have invited the Commission to look into the best
ways of ensuring that also the LULUCF sector contributes to greenhouse gas mitigation and increased
sequestration.
The results of a recent Commission’s impact assessment has shown that a separate framework for
LULUCF is the preferred option to tackle the sector’s climate impact and to ensure the integrity of the
EU’s climate framework. Because the LULUCF sector is fundamentally different from the sectors
currently subject to EU’s climate legislation, due to its inherent characteristics such as non-permanence,
data uncertainties and inter-annual variability, it seems unfit for inclusion in the current climate laws.
Previous drafts of the council conclusions also indicated that certain countries should be allowed to
offset agriculture emissions with afforestation projects. This option appeared to have been included at
the request of Ireland, which has a large agriculture sector. The final council conclusions however only
include a very implicit reference when mentioning in one sentence both intensification of food
production and optimized sequestration “including through afforestation”.
Next steps
- The European Commission is expected to come forward with new legislation how to tackle the
climate impact of the LULUCF sector before 2020.
Carbon Market Watch Recommendations
- The LULUCF sector is best placed in a separate pillar, since the sector’s characteristics (annual
fluctuations, long-time horizons, uncertain data reliability) make the sector unfit for inclusion in
the legislation covering the non-ETS emissions that requires annual compliance.
- Tackling the climate impact of the LULUCF sector should be additional to the mitigation efforts
in other sectors and can thereby enhance the ambition of the overall EU climate framework.
- The sink function of the LLULUCF sector should not be used to displace mitigation efforts in the
buildings, transport and agriculture sectors.
Nine NGOs, including Carbon Market Watch, have recently published best practice principles for how
best to deal with LULUCF in the EU’s climate framework, see here .
6. Financial support to the power sector in low-income states
The 2030 council conclusions read:
2.5 in this context, Member States with a GDP per capita below 60% of the EU average may opt to
continue to give free allowances to the energy sector up to 2030. The maximum amount handed out
for free after 2020 should be no more than 40% of the allowances allocated under 2.9 for auctioning
to the Member States using this option. The current modalities, including transparency, should be
improved to ensure that the funds are used to promote real investments modernising the energy
sector, while avoiding distortions of the internal energy market;
2.7 a new reserve of 2% of the EU ETS allowances will be set aside to address particularly high
additional investment needs in low income Member States (GDP per capita below 60% of the EU
average). It will have the following characteristics:
- the proceeds from the reserve will be used to improve energy efficiency and to modernise the energy
systems of these Member States, so as to provide their citizens with cleaner, secure and affordable
energy;
11