EU urged to attach ‘green strings’ to members’ cash handouts

The European Union is facing pressure from environmentalists and legislators to attach conditions to state aid packages to protect climate goals, as countries pump cash into ailing firms and polluting sectors during the coronavirus pandemic.

The EU agreed on Thursday to build a trillion-euro ($1.08 trillion) recovery fund to revive economies ravaged by the pandemic and has so far signed off on state aid worth 1.8 trillion euros ($1.94 trillion).

So far, the Commission, the bloc’s executive branch, has not attached “green strings” to its approvals of aid from national budgets, as the health crisis takes priority.

Green advocates say they want guarantees that any upcoming state aid will uphold the bloc’s climate ambitions.

“We cannot afford to make the same mistake we did after the financial crisis of 2009 and use public money to invest in the economy, without taking into consideration Green Deal objectives,” Pascal Canfin, a French EU legislator who chairs the European Parliament’s environment committee, told Reuters News Agency.

Canfin said EU approvals must be tied to a pledge from companies that within six months of receiving state aid, they will produce a plan to shift their business towards alignment with the global Paris Agreement on fighting climate change.

The bloc’s chief executive, Ursula von der Leyen, said on Thursday the new package being drafted for review around mid-May, would boost her Green Deal plan to cut EU net emissions to zero by 2050, without giving further details.

In a letter sent to the Commission on Thursday, seen by Reuters, green groups including WWF, Greenpeace and Transport & Environment called for “strict sustainability conditions” on state aid approvals.

High-carbon industries should only get support if they set climate targets, pledge to spend more on low-carbon assets, or shut down polluting ones, they said.

 

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