Gas-fired power plants will not be labeled as sustainable investment in the European Union unless they meet an emissions limit that none currently comply with, according to a draft rule seen by Reuters.
The EU is preparing an obligation for financial institutions to mark, starting with end-2021, the investments that are in line with climate criteria, and can therefore be marketed as sustainable.
The rules are one of the tools to secure investments in low-carbon projects but also to stop greenwashing
The rule is part of a toolset to secure investments in low-carbon projects in order to achieve EU climate goals. The European Commission proposed in September to raise the 2030 greenhouse gas emission reduction target to at least 55% compared to 1990. The EU aims to become climate-neutral by 2050.
According to the draft, stopping the labelling of investments that do not meet the criteria as green would limit so-called greenwashing, Reuters reported.
Gas power plants would not be able to produce more than 100 grams of CO2/kWh if they want to get the green investment tag, according to the proposition
The draft rules say that to be classed as a sustainable investments – making a substantial contribution to curbing climate change – gas power plants would not be allowed to produce more than 100 grams of CO2 equivalent per kilowatt-hour.
Even Europe’s most efficient gas plants produce more than three times the limit, the news outlet noted.
New regulations will not ban investments in gas projects
The new regulations will not ban the investments in projects that don’t meet the EU’s sustainable criteria, the proposal reveals. But it means they could run into obstacles in obtaining funds.
“The gas lobby has had its core request conclusively rejected,” said Rebecca Vaughan, an analyst tracking industry lobbying for InfluenceMap, as quoted in the article.