The European Commission has confirmed that tougher emissions regulations would be less costly to implement than previously thought, according to a study published on Monday. This is due to multiple factors, especially: 1) the economic recession, which caused a significant overall decrease in energy usage, and 2) the effectiveness of EU climate policies to date.
The existing EU emissions regulations require that emissions be cut 20% by the year 2020. There is an up-front cost of doing this and the factors mentioned have reduced it to an estimated €48 billion. According to the report, the lowered cost of the emissions reductions means that emissions can smoothly be reduced by an additional ten percentage points (to 30%). This would be achieved with a 25% domestic emissions reduction and a 5% reduction caused by purchasing international emissions reduction credits.
“The fact that the 20 per cent emissions reduction target is now less costly in monetary terms than was assumed in 2008 means the 30 per cent reduction scenario has become considerably less costly, too,” the report says. “Achieving 25 per cent out of 30 per cent reductions domestically by 2020 is estimated now to cost about €70bn.”
Financial Savings, Jobs, & Reduced Dependence on Foreign Oil
“For the EU as a whole, moving to a 25% domestic reduction in 2020 would save an average of €20 billion in fuel costs each year over the period 2016-2020 compared to the reference scenario. Of this, by 2020, €9 billion comes from reduced oil and gas imports.”
Those are some significant savings, and look like they’re well worth the initial investment.
An increased target is also estimated to create an additional two million jobs.
For these reasons, and out of a sense of responsibility, many NGOs, businesses, and investors have been pushing for a higher 2020 target for awhile now. This report gives them more backing and will, hopefully, push decision-makers to up the EU’s target.
According to the EU climate policy officer:
“This study is important because it offers member states a way to ensure greater stability and resilience against oil price and supply fluctuations, which in turn will create stronger economies and a healthier environment in all of Europe,” she added.
“Higher targets will benefit the EU’s citizens and economy, as well as poorer countries already experiencing the effects of climate change in other parts of the world.”