EU to unveil landmark plan to reduce carbon footprint

Fit for 55 climate change plan aims to reduce emissions by 55% of 1990 levels by 2030

European Union’s Fit for 55 plan targets emissions in all sectors of the economy and in international trade.

Brussels will set out plans on Wednesday for the EU to become the world's first mover on achieving net zero emissions in order to limit global warming, with a decarbonisation strategy targeting all sectors of the economy and international trade.

The European Commission will unveil 13 policies under its "Fit for 55" package – designed to address climate change by ensuring the continent meets its goal of reducing average greenhouse gas emissions by 55 per cent in 2030 and net zero by 2050, compared to 1990 levels.

The plan, dubbed the EU’s “man on the moon moment” by commission president Ursula von der Leyen, risks a backlash from poorer EU countries and some industries which argue that the pace of change and increased regulations will become a financial burden. The measures will also be examined closely by the bloc’s trading partners as their companies face penalties on exports of carbon-intensive products such as steel and cement.

The centrepiece of the EU's master plan is to expand the Emissions Trading Scheme (ETS), a system that makes companies pay for the cost of polluting. Brussels wants to go further to include emissions from the car industry and from heating buildings to quicken the pace of decarbonisation.



Frans Timmermans, the commission's executive vice-president in charge of green policy, called the package "arguably the biggest transformational operation in living memory".

The US and the UK will follow keenly how the EU’s plans play out as they attempt their own ambitious net zero emissions goals.

One of the most anticipated measures is an EU carbon border adjustment mechanism. This will force importers of steel, cement, aluminium and fertiliser to pay for the soaring carbon costs faced by European industry. The prospect of the levy has raised alarm from Russian businesses who say they will be worst hit.

Europe’s transport sector faces the biggest shake-up as Brussels seeks to curb the carbon footprint of an industry whose emissions have been steadily rising since 1990.

The car industry is set to be included in the ETS and new vehicles will be subject to stricter CO2 reduction standards over the next 15 years. The commission’s targets will amount to a de facto ban on the sale of new diesel and petrol cars by 2035, according to officials. This will be accompanied by new rules to increase the availability of charging points and encourage the switch to electric cars.


Aviation and shipping will be penalised for polluting, with a tax on aviation and maritime fuels proposed for the first time. The shipping industry will also fall under the expanded ETS to cover intra-EU journeys from 2023.

The commission hopes to ward off a political revolt over carbon pricing by offering financial support worth tens of billions of euro to help compensate households suffering from energy poverty.

Brussels admits that extending the ETS will have an impact on the poorest households who spend more of their income on heating bills and cannot readily afford to adopt greener forms of transport.

The proposals have already generated opposition from some governments and members of the European parliament who will need to approve the reforms for them to come into force.

Pascal Canfin, a French MEP and head of the parliament's environment committee, warned about the political consequences of the "mistake of extending the carbon market to heating and fuel".

"We experienced it in France, " he said, referring to the populist revolt against planned petrol rises in France in 2018. "It gave us the yellow vests (gilets jaunes)." – Copyright The Financial Times Limited 2021