By Dutch MEP Rob Roos (JA21, ECR), formerly an entrepreneur in the energy and telecom sectors
The success of our Western society has been determined by democracy and an economy based on free market forces. It is no coincidence that those two things go hand in hand, because in an environment where people have the freedom to think and act, innovation and progress florish.
Another key component of this success was affordable and reliable energy. The prosperity which these three components have brought us has also ensured that we have made great strides in improving both the environment and living standards, especially in the Western part of Europe.
However, the economic freedom that has benefited us so much is under grave threat. Today, ‘Fit for 55‘ is beingpresented by EU “Climate Action” Commissioner Frans Timmermans (picture) as part of the “European Green Deal”. This is a mega package of EU legislation to ‘green’ the economy.
It involves the following updates to existing EU law:
- Revision of the EU emission trading scheme (EU ETS)
- Revision of the regulation on land use, land use change and forestry (LULUCF)
- Revision of the effort sharing regulation (ESR)
- Amendment to the renewable energy directive (RED)
- Amendment to the energy efficiency directive (EED)
- Revision of the alternative fuels infrastructure directive (AFID)
- Amendment of the regulation setting CO2 emission standards for cars and vans
- Revision of the energy taxation directive
It also contains some new legislative proposals :
- New EU forest strategy
- A carbon border adjustment mechanism (CBAM)
- A Climate Action Social Facility
- ReFuelEU Aviation – on sustainable aviation fuels
- FuelEU Maritime – on greening Europe’s maritime space
The European Commission claims that this package will modernize the economy, stimulate innovation and provide a competitive advantage over other economies. However, when politicians – especially EU politicians! – talk about innovation and competitiveness, alarm bells should go off.
A European planned economy and a sign of lost faith in the free market
All aspects of our economy will be affected by this proposal. The European Commission is embarking on a risky venture in which it not only says ‘what’ should be done, but also ‘how’ it should be done. It involves the government seizing the entrepreneur’s seat, while consumers are being instructed with respect to their consumption behaviour. “Fit-for-55” truly envisages an outright planned economy.
However, progress only happens when creative entrepreneurs have the space to turn ideas into reality. Regulation should follow innovation, not the other way around. That should be the guiding principle. What the package makes clear is that the European Commission has definitively lost its faith in the free market.
What does this signify for the climate?
The European Commission claims that this increased ambition from 40% to 55% reduction of greenhouse gases compared to 1990 would only cost 1,300 billion euros. However, according to a more realistic estimate by economist Bjørn Lomborg, that cost will run up to 4,000 to 5,000 billion euros.
What’s more, even if all EU targets are met, the final result will only be an immeasurably small temperature reduction of 0.004°C. Meanwhile, the environment, nature and landscapes will have suffered major damage.
The European Commission’s climate plans are insanely expensive, will take away many of our freedoms and will have next to no effect on the climate. Our economy is being put at risk with production costs and consumer prices increasing sharply. If this new ‘green economy’ would really be the revenue model the Commission believes it to be, we would not need all this legislation. There is a real danger that the competitive position of EU member states will be damaged in the face of competition from China, the United States and emerging economies like India.
Nuclear power is the only option
Then does that mean we should do nothing? No, certainly not, we must continue what we were doing, which is to invest responsibly in an even better future. Politicians may determine the final target, but they should do so in a technologically neutral way. The implementation should be left to the market. After all, every investment must be properly recovered and subsidies should never become a permanent instrument. This applies to both energy generation and investments in isolation.
The proposed solutions must contribute to a better future, but the European Commission continues to insist on biomass as a large component on the path to carbon neutrality. This involves complete forests being burned in the oven, something which is at odds with the ultimate target. Trees absorb CO2 and are important for biodiversity. Combustion for energy generation also releases more CO2 and air pollution than gas.
Also wind turbines and solar meadows are not efficient, and generating energy in this way comes at the expense of nature, landscape and public health.
In fact, investing in nuclear energy is currently the only solution to phase out fossil fuels in the long term. Nuclear energy is reliable, it has a high energy density and is therefore efficient, thereby sparing the environment and landscapes. It also emits no air pollution at all and, contrary to what activists say, nuclear waste is very manageable. France has proven this for decades.
The Commission, with all its ambitious plans, has however not yet included this form of energy generation in its plans for “taxonomy”, which determine which economic activities can benefit from a sustainable finance label. As a result, there is no economic level playing field with respect to solar, wind energy and biomass.
Recently, two EU scientific councils published their conclusions on nuclear energy. In general, the reports confirm the previous conclusions of the Commission’s own Joint Research Center (JRC) that nuclear energy is an important tool in phasing out fossil fuels and does not cause serious damage to the environment. This means it meets an important condition for being included in the taxonomy. Nuclear energy is also part of the solution in the IPCC scenarios, and NASA has calculated that nuclear energy has saved millions of lives because of the fact that it has prevented air pollution.
In sum, all major success factors of our Western society are being undermined by the European Commission’s “Fit-for-55” plans. Free market forces are being exchanged for a planned economy and energy generation is becoming less efficient and therefore more expensive for companies and consumers.
However, the greatest danger lies in the threat to democracy. With this package locking in policy, citizens will no longer have any say in what our society should look like for the next thirty years. That has already been determined in the Berlaymont building, something which is eerily similar to the governance model abandoned by the people of the former Soviet Union thirty years ago.