11 Feb Germany’s difficulties with taxonomy
Brussels, 11.02.2022. 2022 came with a big present for the current French EU Presidency. The European Commission presented a draft of a delegated act on taxonomy including nuclear power as one of the technologies that investors should favor with regards to climate mitigation. It is obvious that this was to please French President Macron who had not surprisingly advocated hard for this technology over the last months. But not only the nuclear dimension was criticized. The fact that gas as a transition technology was also included in that list although it clearly stems from fossil sources was definitely not welcomed by many Member States and Parliamentarians. Member States with green energy ministers- with the exception of Germany – announced immediately they would go to court against this delegated act, once it would be adopted. To block the delegated act beforehand an absolute majority in the European Parliament is required. The Council can still torpedo the delegated act, too: At least 20 Member States, representing not less than 65% of the EU population, have to object – a scenario that is more than unlikely given the support for the proposal by heavyweight France and other countries like Poland.
However, after a month of consultation with Member States the Commission published the official proposal for a delegated act which has not been changed substantially despite all protests.
The German government has been in a difficult position to react to the fact that two technologies which are criticized by at least one partner in the new government are included in the puzzle for the future taxonomy. The agreement of the three parties forming the so-called traffic light coalition, confirmed the exit of the country from the use of nuclear power. There was never any doubt that this major decision following the catastrophic nuclear disaster in Fukushima would be withdrawn. Back then a coalition including the Christian Democrats and Liberals under the leadership of Angela Merkel decided quasi-overnight to step out in a coordinated plan. This was carried broadly by the whole political system having been advocated for decades especially by the Green party. Now as the Greens are governing it was only natural that the area of producing nuclear power in Germany would end systematically. But what about gas? The new German chancellor Olaf Scholz said crystal clear in previous announcements even before winning the elections in September 2021 that he would step out of nuclear and he would accelerate the course to step out of coal, not renouncing on gas as a bridging technology towards a system based on renewable energies. Also, the Liberals, who are represented prominently by their party president and new finance minister Christian Lindner in the traffic light government, declared right from the beginning that they would regard gas as a bridge especially using the existing infrastructure for renewably produced gases in the future. The rationale was quite clear: in order to replace the missing nuclear and coal-based power plants gas should step in at least for some time emitting much less CO2 than coal and at the same time being much less hazardous then nuclear. This was enshrined in the coalition agreement forming the basis for the four years of joint government. So, on one hand Germany would need to criticize the taxonomy proposal, on the other hand it mirrored exactly the political position that the new government decided upon in their coalition agreement. Whereas the Social Democrats and Liberals would not publicly criticize the taxonomy proposal the Green party did. Not going so far though, as their green colleagues in Austria and Luxembourg, that announced they would go to court against the delegated act. There have been many examples in the past where the German government would not support actively a position, but it would not oppose to it actively either. This is what now can be expected as well: the German government will tolerate this delegated act and there will not be a sufficient majority of opponents in the Council for this taxonomy agreement.
This is the time where the devil in the detail will play a role. Whereas the categorization of nuclear seems simpler there need to be clear rules for investments into gas technology. Any continuation of a rollout of gas infrastructure would go against the spirit of the European Green Deal. The December package on decarbonized gases contains also clear proposals with regards to methane leakage. This is one of the urgent questions where humanity needs to find a quick solution as methane is proven to have a disastrous effect once omitted into the atmosphere. Hence, investments into gas technologies adding new log-in effects for fossil energies should definitely be prohibited. Additionally, any investment should already set the course for the decarbonized gas system.
To conclude: there was absolutely no necessity to include gas and nuclear into the taxonomy. It should have been left out right from the start. Regarding gas, there must be a clear and short-term transition period. Retrofitting and reproducing of pipelines and of compressors should be at the forefront as any other investment into the infrastructure leading to green molecules. This is where the German government is to be expected to actively be involved and concentrate on a more convincing “sustainable” interpretation of that part of the taxonomy proposal.