European lawmakers on Wednesday agreed to legislation that allows natural gas and nuclear energy to play a part in curbing CO2 emissions.
The European Parliament plenary in Strasbourg gave the go-ahead to a draft proposal of the EU Taxonomy, a classification system that establishes a list of environmentally sustainable economic activities.
The list proposed in January by the European Commission — which drafts and executes European Union legislation — includes both natural gas and nuclear power.
The taxonomy is meant to be a tool to guide investors who want to put their money into green projects. It also introduces disclosure obligations on companies and financial market participants.
It is to take effect on 1 January, 2023.
The Complementary Delegated Act approved by lawmakers also provides criteria under which private investments in gas or nuclear comply with the taxonomy.
Passing the text through parliament means that the taxonomy can now only be overturned by a majority of 20 out of the EU’s 27 member states representing at least 65% of the bloc’s population.
Observers believe this to be unlikely. The driving force behind labeling nuclear green is French President Emmanuel Macron, whose country has been relying for decades on nuclear power to cover its energy needs and has exported it to other countries.
Shipping is not directly affected by the decision. Parts of the industry, however, mainly gas carriers, stand to benefit indirectly as the EU’s move will likely enhance financing for natural gas infrastructure, such as LNG terminals.
Classifying nuclear as a renewable, carbon-free source of energy may also ease some of the burden that shipping faces to contribute to global emission reduction targets.
Cries of betrayal
Nuclear power is divisive. Anti-nuclear protesters watching from the EU parliament's visitor stands cried “betrayal” when results of the vote were announced.
EU authorities, however, stand by the text.
“Low-carbon nuclear is part of our energy mix in [the] transition too. And that is why it is in the transition category of the Taxonomy,” EU financial services commissioner Mairead McGuiness told EU lawmakers on Tuesday.
Several commentators, including in shipping, have criticised the ‘green’ label for natural gas as well.
Critics point out that when "well-to-wake" emissions across its life cycle are taken into account, natural gas can be just as harmful as other fossil fuels, especially because of methane leakage.
McGuiness acknowledged that criticism but said that natural gas has a role to play in the transition.
“I have never described gas as anything other than a fossil fuel. But some member states moving from dirty fossil fuel may need gas in transition — and that is where we have placed gas in this taxonomy,” she said.
