“The EU’s new 2040 climate target is unachievable”

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Vincent Bénard, town and country planning engineer and economist, former president of the Brussels-based Hayek Institute, is the author of “The EU Climate Law: An Economic and Societal Disaster with Zero Impact on the Climate” (1), published by French think tank IREF in December 2025. In this interview, conducted by The European Scientist, he answers questions about EU’s mandates on energy policy, covering the ambition behind the law, the famous Kaya identity, the electrification and decarbonisation plan, the assault on individual freedoms and genuine alternatives.

The European Scientist: You’ve just published a report on the recent developments of the EU’s “Climate Law”. Could you remind us of the context and the core ambition of this legislation?

Vincent Bénard: The European Climate Law sets a continent-wide target of reaching “net zero” greenhouse gas (GHG) emissions by 2050. By that date, the EU’s gross GHG emissions must be equal to or lower than the CO₂ absorption by the Union’s natural carbon sinks: forests, farmland, soil exchanges, etc.

In plain terms, this means that, on average, each EU citizen should emit no more than roughly one ton  of CO₂-equivalent per year — compared with about seven tons today.

But the law doesn’t stop at setting an end goal. It imposes intermediate milestones: a 55% reduction in net GHG emissions (compared with 1990 levels) by 2030, and very recently, an additional step — an amendment requiring a 90% reduction by 2040, which was approved by the Environment Council of Ministers in November 2025. 

And because achieving this at European level requires every Member State to move in lockstep, the EU piles on top of these outcome targets a whole series of means obligations: shifting electricity production massively towards renewables, converting carbon-intensive industrial processes (metals, cement, fertilisers, glassmaking, farming, etc.) to non-fossil methods, and electrifying the main household energy uses (transport, heating, etc.). 

Once the Council has adopted it, the 2040 amendment still needs ratification by both Parliament and Council before it enters into force in the first half of 2026. Because it is a European regulation, it doesn’t require formal transposition by Member States — but they will still have to pass the domestic legislation needed to meet the targets.

Together with the IREF we felt the law was damaging enough to warrant a report aimed at policy-makers (1), showing that its final adoption would be a serious strategic blunder.

TES: You rely heavily on the Kaya identity, a well-known equation among economists who work on climate issues. Could you explain what it is and what conclusions you draw from it?

V.B.: Even though the Kaya identity is mathematically very straightforward, it is poorly understood — especially by politicians — and that’s a real problem, because it instantly reveals how unrealistic (some would say fanciful) the EU’s desired policies really are. In its most compact form, the identity simply states that GHG emissions = GDP × carbon intensity of GDP (the amount of CO₂ emitted per unit of GDP, also called Ic). That intensity depends on technological progress. What the Kaya identity makes crystal clear is that any policy aiming to cut emissions has a direct impact on GDP. If emissions are forced down faster than technology can improve the carbon intensity, prosperity inevitably suffers.

Our report shows that reaching a 90% reduction by 2040 (vs 1990) requires a ~68% drop from 2023 levels — in just 17 years — when the previous 33 years delivered “only” a 37% reduction. That 37% over three decades is already the world’s best performance by a very long way. Yet the EU now demands almost twice the speed of reduction in half the time. According to Kaya, that would require improving carbon intensity by more than 7% per year, whereas the current world-leading European rate is around 2.5%. Where exactly is the magic wand? How could Europe suddenly become three times more clever or three times more effective than in recent decades? Such leaps cannot be ordered by decree.

Kaya also tells us that if we insist on meeting the target while keeping the present pace of carbon-intensity improvement, Europe would have to sacrifice roughly half its GDP. That is plainly impossible: European populations will not accept sustained economic contraction and the resulting loss of living standards without serious risks to public order. Finally, the identity suggests a far more realistic path: preserving current growth rates, we could plausibly achieve a ~25% emissions cut by 2040 instead of the 68% demanded by the law.

TES: Yet the EU claims it is perfectly possible to maintain current growth rates while slashing emissions 90%, which would indeed require that 7% annual drop in carbon intensity. Why do you think that’s not feasible, and what exactly is the EU’s grand plan for getting there?

V.B.: Historically, the only country to sustain a 5% annual improvement in carbon intensity over one decade was France — in the 1980s — thanks to the programme that rolled out 45 nuclear reactors, after more than ten years of preparatory work in the 1970s. France has never repeated that performance; its rate has since settled back around the European average of ~2% a year. 

Yet the EU now expects an entire continent to beat France’s historic record — and to do so for more than a quarter of a century (remember, 2040 is only an intermediate step towards an equally daunting 2050 goal). Its answer is to pour trillions into completely reshaping the continent’s energy landscape. The plan requires economic actors (governments, companies, households) to spend between €1,200 and €1,600 billion every year until 2040 — more than €20,000 billion overall, equivalent to 7-8% of EU GDP — to decarbonise electricity generation, heavy industry, agriculture and household consumption.

To “incentivise” (or frankly compel) these outlays, the EU plans to cover only 15-20% through public money, leaving the rest to private wallets via a cocktail of subsidies and tough regulatory mandates. The blueprint involves massive roll-out of intermittent renewables, huge expansion of transmission grids, a hundred-fold increase in electricity storage capacity (currently unthinkable), forcing emissions-intensive industries to switch to electrified processes, pushing households, hauliers and farmers into electric vehicles, mandating heat pumps as the default home heating solution… The list of affected sectors is endless.

TES: You are extremely critical of this plan. Why? Can we already say it is doomed to fail?

V.B.: We didn’t need speculative number-crunching to demonstrate the plan is unachievable. We simply compiled a long list of findings from official bodies (national Courts of Auditors, the ECB, grid operators, etc.) showing that actual achievements are already way behind schedules and that the EU’s own cost estimates — enormous as they are — will turn out to be grossly optimistic. The fatal flaw is the requirement for perfect synchronisation among every moving part: grids must expand exactly in line with renewables, storage must grow faster than intermittency worsens, demand must rise precisely on schedule. Any misalignment creates technically and economically intolerable bottlenecks. 

Reality shows these misalignments are not exceptions — they are now the rule, and on a massive scale. Large-scale intermittent renewables (wind & solar) create wild swings between forced curtailment with negative prices and acute shortages when day-ahead wholesale prices skyrocket because renewables can’t deliver. Subsidies for renewables, originally sold as temporary, are climbing again. Even so, the European renewables sector is in deep crisis, with project cancellations piling up.

The April 2025 Spanish blackout highlighted that over-reliance on uncontrollable sources undermines grid stability — and the problem is nowhere near being solved, either technically or economically. Beyond that high-profile Iberian episode, European transmission system operators report a 25,000% surge in voltage incidents since 2015 — clear evidence of growing systemic fragility.

The EU’s answer is a frantic acceleration of grid build-out and massive storage deployment, especially hydrogen. Yet real-world delivery schedules are years behind the official roadmaps. Germany and the Netherlands perfectly illustrate this growing disconnect between generation, transmission and storage. In Germany only about one-sixth of the new power lines scheduled under the Energiewende have actually been built. Financial analysts say investment capacity in grids needs to be quadrupled just to hit 2030 goals — never mind 2040 — and no one knows where the money will come from.

In the Netherlands, on three-quarters of the territory, connecting new homes or businesses now involves waiting years because the grid can’t handle the intermittency and simultaneity effects. Dutch operators estimate €200 billion is needed by 2040 just for grid upgrades — for a population of 18 million. Extrapolate that to an EU 25 times larger and the EU’s own €1,200 billion estimate for the same budget line starts looking laughably low. 

Hydrogen is not faring better. European and national audit bodies describe national hydrogen strategies as more political wishful thinking than serious technical or economic planning. Very few projects are actually moving forward, and the key technologies remain immature. The storage targets for 2040/2050 are therefore largely speculative.

In industry you only scale a solution once prototypes have proved their economic worth. The EU is decreeing the mass deployment of technologies that are not only unproven, but in some cases exist only on paper. That is reckless.

Even Germany is now quietly acknowledging the limits of the European model — which is also its own. Chancellor Friedrich Merz has announced a 180-degree policy U-turn, with a plan to build 71 new gas-fired power plants by 2035 to provide back-up against recurrent wind and solar shortages, tacitly admitting that electricity storage remains an unsolved dead-end. 

TES: You also point to a clear lack of appetite from customers for “decarbonised” products.

V.B.: On the demand side too, European ambitions are hitting hard reality. Electro-intensive industries are discovering that global markets will not pay a premium for “green” steel, aluminium or chemicals. European aluminium output has fallen 25% since 2010 while world demand has jumped more than 70%. Sky-high electricity prices are triggering waves of factory closures and layoffs — including in Germany — with production relocating to Asia and the United States.

European agriculture is already the world’s least emissions-intensive, yet it cannot move faster than available technology allows. The fertiliser industry is struggling to find economically viable substitutes for hydrocarbon-based products, and the shift to fully electric farm machinery is still in its infancy with no prospect of rapid change.

Household demand is equally lukewarm. Electric vehicle sales have plateaued amid ongoing concerns about cost, range, charging and reliability. Heat pumps and home insulation have followed exactly the same pattern: initial hype, disappointing returns on investments, then a collapse in orders once subsidies are scaled back — and cash-strapped governments cannot keep them forever.

Even if a string of technological miracles suddenly delivered mature decarbonised solutions (ignoring the usual R&D and industrialisation timelines), replacing a huge stock of perfectly functional existing capital takes decades. Forcing businesses and households to scrap still-useful assets prematurely to adopt subsidised “green” alternatives would require colossal financing and represent an astronomical waste of resources. 

Across the board, real private investment is currently running at less than one-third — sometimes barely a quarter — of the levels the EU was banking on. With so many visible implementation failures already piling up, it is fair to say none of the plan’s objectives will be met. It would be wise for the EU to recognise this reality before the economic damage becomes irreversible.

TES: You warn that the plan threatens individual freedoms. What do you mean exactly? 

V.B.: The threat is already materialising. In the Netherlands and Ireland, cattle farmers have been ordered to halve their herds in the name of climate targets — sparking huge protests. In France, owners of poorly insulated homes (energy class F or G) are now legally barred from renting them out. The social fallout is enormous: France already holds the world record for homelessness, and households pushed out of their properties suffer far harsher energy poverty than simply living in a poorly rated dwelling.

There are influential groups of thought within European institutions that would like to see every single transaction accompanied by a personal carbon ledger, capping individual consumption once a threshold is reached. Some German Länder have tried to impose fines on households slow to install heat pumps. Public backlash forced them to back down — but for how long? 

The potential for this obsessive anti-CO₂ crusade to become deeply authoritarian is real, proven and very high.

TES: But isn’t that simply the price we have to pay to fight climate change?

V.B.: Without reopening the debate about whether or not there is a climate “crisis”, Europe already accounts for barely 8% of global GHG emissions — and that share is shrinking fast while Asia’s has reached 60%, roughly its share of world population. According to the IPCC’s own AR6 formulas, the difference in global temperature by 2100 between the EU reaching net zero in 2050 versus reaching it in 2100 lies between 0.02 °C and 0.06 °C — an utterly undetectable signal.

By contrast, Asia’s contribution could range between 1 °C and 3 °C. If the IPCC is right about the harmful consequences, is it sensible to completely dismantle Europe’s energy system with an unrealistic and ruinously expensive grand plan for a negligible climate benefit? Is it acceptable to sacrifice core freedoms for such a pitiful outcome?

And even if we accept the premise: the prosperity we destroy with these policies will be sorely missed when the time comes to pay for adaptation to whatever climate change the rest of the world imports to us.

TES: Criticising is easy — but do you propose an alternative energy model?

V.B.: Yes — and it already exists. The EU’s desired transition is modelled on Germany’s Energiewende, which has already failed. Even Germany’s Chancellor Friedrich Merz openly admitted it recently. 

There is, however, a far more virtuous model — both financially and in emissions terms: the French model, built around a stable nuclear + hydro baseload, with fossil plants (gas and coal) used only as flexible back-up to follow seasonal and daily demand swings. Some researchers estimate that if Germany had chosen that approach instead of betting everything on the whims of wind and sun, it would have cut its GHG emissions by an extra 73% over the past 25 years — and for half the investment. 

Improving this model simply means finding non-fossil substitutes for the remaining flexible fossil capacity. That can be done either by developing more modular, cheaper, series-produced nuclear designs, or by investing more heavily in R&D on other truly decarbonised options (carbon capture, deep geothermal…) that are still immature — without forcing their premature, subsidised roll-out until they prove economically viable on their own. Compared with the bureaucratic, top-down, centrally planned “Rube Goldberg machine” the EU intends to impose — with zero accountability if it fails — simply upgrading the French model incrementally, letting the private sector develop future electricity production at its own pace and letting customers adopt decarbonised end-uses when the economics make sense, requires only gradual improvements to what already works, without a radical, society-wide paradigm shift dictated from Brussels. 

We therefore hope European parliamentarians will show some common sense and refuse to rubber-stamp the 2040 plan as a matter of routine. Instead they should call for a complete overhaul of the climate strategy — in a less dirigiste, more realistic direction. 

And if, unfortunately, the EU stubbornly sticks to its “climate fundamentalist” line whatever the cost, we at least hope that future French governments will have the courage to stand up to Brussels and rehabilitate our own proven energy model that has delivered for the past fifty years.

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(1) Vincent Benard/IREF’s report, in French: “The EU Climate Law: An Economic and Societal Disaster with Zero Impact on the Climate”, December 2025, web, PDF 

Originally published by The European Scientist

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