The European Parliament has just given the green light to the criteria that will be taken into account to determine which economic activities are environmentally and socially sustainable within the European Union. This means that it has approved the so-called “taxonomy”, which seeks to avoid greenwashing and encourage investments in activities that are aligned with the Paris Agreement and contribute to make progress towards the ecological transition and to the achievement of the new European Green Deal (Pacto Verde Europeo).
According to the new rules, an economic activity should contribute towards one or more of the following objectives and not significantly harm any of them to determine whether it is sustainable or not:
- Climate change mitigation and adaptation;
- Sustainable use and protection of water and marine resources;
- Transition to a circular economy, including waste prevention and increasing the uptake of secondary raw materials;
- Pollution prevention and control.
- Protection and restoration of biodiversity and ecosystems.
Greening the financial sector is a first step to make investments flow in the right direction and to ensure they contribute to achieve the climate-neutrality goal.
The text does not preclude or blacklist any specific technologies or sectors from green activities, apart from solid fossil fuels, such as coal or lignite. Gas, and nuclear energy production are not explicitly excluded from the regulation, however. These activities can potentially be labelled as an enabling or transitional activity in full respect of the “do not significant harm” principle.
No Comments