The Green Deal which was proposed as a new strategy for growth in the European Union by the European Commission in late 2019 has received a lot of support but has also aroused some criticism and outspoken opposition.
This review paper presents the view of MRF’s MEPs, members of Renew Europe group, regarding the Green Deal and its multilayered application as an effective strategy for growth. We are convinced supporters of the Green Deal, and firmly stand behind the idea that it offers Bulgaria huge development opportunities, provided that our country puts in place its national strategies, plans, work programmes, and first and foremost, unites around the national goal for accelerated catch-up development.
The Green Deal is a strategic plan for the development of the European Union for the upcoming 7, even 30 years, and a basis for the work of the European Commission. This Deal has grown into a complex strategy for transformation and building a low-carbon economy, resource-efficient production and circular economy, innovations and digitalization. It has united in one targeted effort the technological achievements over recent years with the expected innovative solutions and the European citizens’ willingness to engage in the prevention of climate change and the common European support for technological, production and social changes, which will impact the life of each European citizen.
At the onset of the COVID-19 pandemic in the first half of 2020, some Member States, with a more conservative, populist or reform-sceptic governance, expected that the Green Deal would be put on the back burner, and its ambitious aims would be postponed due to the evolving health crisis, the hesitant role of the European Union during the first months of the crisis, and the expectations for an economic crisis with unclear parameters. Regrettably, Bulgaria was one of these Member States, and allowed itself to lose precious time in the preparation for reforms, transformations, and the strategic planning of the national transition within the framework of the Green Deal. This error committed by the Bulgarian government will have a high cost. Valuable time was wasted, and our country must catch up in the process of preparation and coordination of the strategic documents in a year of parliamentary and presidential elections.
In 2020, the European Parliament and the Council of the European Union put enormous efforts into developing the tools for the implementation of the Green Deal. The negotiations were completed for most of the funds and programmes which will constitute the framework and will ensure investments for recovery and transformation, alongside the Recovery and Resilience Facility: ranging from the general rules for the Structural Funds and the European Regional and Social Fund to programmes such as Horizon Europe and the European Defence Fund, Erasmus and the Just Transition Mechanism.
In parallel with these efforts, the European Commission ensured the application of the Green Deal by launching almost all the initiatives, legal acts and proposals which supplement the initial proposal, finetune the legislative landscape, and provide real solutions backing up the intentions and the ambitious goals of the project: Sustainable Europe Investment Plan; Just Transition Mechanism; European Climate Law; New Industrial Strategy for Europe; Circular Economy Action Plan; Farm to Fork Strategy; Biodiversity Strategy; Integrated Energy System Strategy; Hydrogen Strategy; Renovation Wave; Methane Strategy; Chemicals Strategy for Sustainability; EU Strategy to harness the potential of offshore renewable energy for a climate neutral future; Digital Markets Act; New European Bauhaus.
While the above list is not exhaustive, it gives an idea about the huge volume and the large scope of the initiatives and documents feeding specific content into the proposal for the Green Deal, and making it the EU Growth Strategy for the next decade. The European Parliament has responded to both the above and other proposals by means of clear positions and legislative solutions.
2021 will be the year in which the responses and proposals of the Members States are expected. The documents to be drafted, coordinated and agreed are: the national recovery and resilience plans, the just transition plans for the regions in transition, the operational programmes with financial support from the structural and cohesion funds, the informal national plans for participation in EU’s horizontal programmes.
One of the main areas covered by the Green Deal is energy.
It was still in 2018 and 2019 that the Member States were expected to complete their energy and climate national plans. We have to once again point out with regret that the delayed Bulgarian plan has resulted in losses and the impossibility to build effective links and coordination among the tools that could support the reforms and the transition to a low-carbon energy, at the initial stage, and to a carbon-free energy, in the future. The package of EC’s legislative and strategic proposals and EP’s positions relate to the following topics: prevention of climate change; decarbonization of energy production; diversification of energy sources; gradual phasing out of fossil fuels, including natural gas, till the complete replacement thereof in the energy mix on the territory of Europe; increasing the energy efficiency of industrial production with a minimum carbon footprint; high residential energy efficiency; targeted investments in the development of hydrogen technologies; increasing the share of renewable energy sources and further developing the technologies for their application, including renewable energy storage.
Hydrogen production and its application in industry, energy and transport is included on the agenda of the EU and its Member States as a general policy. The hydrogen strategy proposed by the European Commission raises a lot of issues whose solutions pertain to the technological development which even countries with the potential of Germany consider as achievable only via cooperation with the other Member States. Bulgaria will benefit from big opportunities, if it ensures its timely and decisive involvement in the cooperation process of developing hydrogen technologies and hydrogen application strategies as the basic element of green transformation.
A complex element of the implementation of the Green Deal for energy efficiency is the renovation wave – an initiative aimed at a drastic increase in the number of energy efficient buildings across Europe during the next 10 years, the process being expected to evolve till the year 2050. The renovation envisaged concerns public, both state-owned and municipal, buildings, multi-family buildings and single-family houses. The building stock is energy-intensive, and its footprint accounts for approx. 36% of CO2 emissions in Europe. Fostering energy efficiency via renovation combines the use of modern recycled materials, innovative digital technologies, a drastic growth in the number of jobs in the construction sector due to the work volume and improving the workers’ professional qualifications, developing innovative small- and medium-sized construction enterprises, ensuring the digital management of the energy efficiency of buildings, and issuing building passports in view of long-term and efficient management. We already know that 90% of the now existing building stock in Europe will still be in use in 2050. Investments in the renovation of this stock are the prerequisite for attaining the goals for a climate-neutral management of energy efficiency over a 30-year period. Bulgaria is amongst the states with low energy efficiency of its building stock. Our country has lagged behind with building passports, hence, the opportunities offered by the renovation wave are essential for both the construction sector and property ownership. The expectations are focused on the National Recovery and Resilience Plan.
An important element of the Green Deal for Bulgaria and other EU Member States that are dependent on fossil fuels, in particular coal, is the Just Transition Mechanism whose ambitious goal is supporting the regions in their transition to green solutions. The two components of the Mechanism – the Just Transition Fund and the Municipal Loan Facility – have clear objectives and provide the local authorities with opportunities for reasonable, balanced solutions for technological changes, social security, and flexible investments.
In coordination with the National Recovery and Resilience Plan, the plans of the regions in trans
ition could ensure a smooth green transition for the regions in Bulgaria. Such development requires governance efforts, clear messages to those employed in the mining industry and thermal power plants, as well as governance self-confidence and vision. This is the only way for the Just Transition Mechanism to play its role in the overall context of the Green Deal.
The latest and seemingly unclear initiative of the European Commission for the implementation of the Green Deal is the New European Bauhaus. This is neither a fund nor a programme, it has no application forms, no indicators and managing authorities. This is an initiative whose ambition is to contribute to changing the living environment of the European citizens in line with their climate change concerns, environmentally-friendly use of resources, circular economy, biodiversity protection. An initiative that will bring the Green Deal closer to everyday life in terms of values, philosophy, technologies, and culture.
The Biodiversity Strategy and the Farm to Fork Strategy, as well as financial tools to facilitate the transition are at the core of the EU Green Deal. The Common Agricultural Policy (CAP) is, of course, also directly related to the Green Deal. The objective is achieving a balance between nature and food production systems, the protection of the health and well-being of those living in the EU, and promoting EU’s competitiveness and resilience.
The 2030 Biodiversity Strategy pursues boosting Europe’s sustainability by curbing the loss of biodiversity and developing a healthy and sustainable food system. The focus is on ensuring that biodiversity considerations become an integral part of EU’s overall strategy for economic growth. The Strategy proposes drawing up some binding targets for the restoration of degraded ecosystems, improving the health of protected habitats and species in the EU, restoring pollinators in agricultural lands, reducing pollution, greening our cities and towns, improving biological agriculture and the state of European forests.
The ambition to achieve an accelerated transition to a sustainable food system in the EU is part of the Farm to Fork Strategy, and aims to achieve a neutral or positive environmental impact and help mitigate climate change and adapt to the effects thereof. In addition, the measures envisaged are expected to prevent the loss of biodiversity and guarantee food security and public health. Each individual should have access to sufficient, safe, and nutritious food manufactured by applying a sustainable model. Furthermore, accessibility of food is pursued in parallel with generating more equitable economic returns.
It is, however, essential for Bulgaria to strike a balance among the individual sustainability pillars: environmental, economic, and social. All the actions taken should also follow the line of increasing the income of agricultural producers, guaranteeing food security and providing the necessary support to the sectors and the people who have to make substantial investments in the desired green transition. We insist on ensuring that the strategies will result neither in additional burden on agricultural producers, nor in reducing agricultural output in the EU, which in its turn would make us more dependent on third countries.
Climate change puts food production at risk, and agricultural producers have considered this fact by introducing a number of changes to counter this development. Another aspect to be emphasized is CAP’s key role in terms of the protection and promotion of the biodiversity of agricultural land. The components of CAP’s green architecture also have a big potential to encourage agricultural producers to take additional actions to combat climate change: the individual and collective incentives envisaged for the transition to more sustainable agricultural systems for food production.
What is also needed is an assessment of the financial impact of the Strategy on agricultural producers, in particular on small farmers, including family farms and SMEs. Achieving the targets will inevitably require substantial investments at the level of farms, which might be a disproportionate burden for small producers. An example in this respect is the access to modern technologies and the digitalization of farms. Therefore, adequate access to financing must be ensured.
Scientific research should be promoted, and digitalization and innovations should develop. The measures should be carefully determined, and they should be voluntary or mandatory. A major prerequisite is ensuring good coordination among all the strategies and programmes related to agriculture and food chains, and taking into account the specific conditions and the measures that have already been taken in all the Member States.
The sustainable management of water resources requires providing more options for support, for building effective and efficient irrigation systems. The responsibility for achieving the targets must be shared among all the stakeholders along the food production and supply chain, instead of being borne mostly by agricultural producers.
Defining clean food as a priority requires more support for biological agriculture, and a targeted campaign to raise public awareness about the importance and the need for diverse, nutritious and clean food. Special attention should be paid to the accessibility of food. A huge part of the population still cannot afford quality food. Rising production costs will inevitably affect the price of end products. The successful transition to a sustainable model also depends to a large extent on consumers. It is important for them to be able to make informed choices in respect of the quality and nutritious value of individual foodstuffs. This process should also take into consideration the states’ specific practices in terms of labelling, and avoid imposing a model that may put traditional national products in a less favourable position. A focus is needed on measures to reduce food waste along the overall chain of production, supply and consumption.
A strategic goal is developing a modern, diverse agricultural sector, with due care for nature and people. The key to achieve this goal is ensuring that the policies and tools are aligned by taking into consideration the effective legal framework and drawing up long-term plans based on realistic objectives.
The national strategic plans related to CAP should provide for adequate financial support and incentives to promote new sustainable business models for agriculture and traditional food production by stimulating short supply chains and the production of quality foodstuffs. While the financial support under CAP is crucial for agricultural producers in terms of their ability to meet the growing environmental standards, it will not be sufficient for them to achieve the targets envisaged in the two strategies. Additional adequate support measures and means should accompany CAP funds.
Innovations are a major driving force for sustainable growth and environmentally-friendly sustainable agriculture with improved productivity and profitability. The strategies should build upon a strong European commitment to promote research and the development of innovative solutions and technologies in key areas such digitalization, precision agriculture, safer effective and efficient plant protection products, fertilization, and veterinary medicines.
In order to be a leader in modern agriculture, with due care for agricultural producers and the environment, Europe should also build platforms for cooperation, exchange of knowledge, innovations and technologies, with the active participation of all stakeholders.
Europe’s pursuit for growth and a clean and harmful GHG-free environment affects all fields of activity. The target changes envisaged apply to all economic sectors, and will have a particular impact on industry, energy, agriculture, urban planning, and transport. Employment will undoubtedly be one of the EU’s top priorities which will be allocated substantial financial resources.
The ambitious strive for Europe to become the first climate-neutral continent by 2050 faces the social employment policy with some issues of paramount importance. The Green Deal can certainly be considered as a historic opportunity for a revolution in the economy and an unprecedented opportunity to introduce digitalization in almost all areas of labour. On the other hand, however, we cannot overlook the fact that this Deal will pose a serious challenge to the industry in a number of Member States. Investments in climate protection require a long planning period, as they relate to implementing new production processes and new products. In this context, an important factor is political stability not only on a national level but also on a global scale.
The Green Deal pursues a very ambitious economic transition and building a renewed EU. It should be pointed out that the process was initially characterized by continuity and shared ideas that were supported by both the citizens of many EU countries and well-developed business organisations and financial institutions. The motivation of these supporters stems from the expectation that green technologies, together with digital technologies, will be shaping the markets till the middle of this century, and the first ones to implement them will benefit from an unquestionable advantage. In spite of this support, however, the issue regarding the necessary financial resources and the speed at which such goals are achieved is crucial. With this in mind, the EU has declared its intention to prevent the deepening of social inequality, and apply in practice the ‘leaving no one behind’ principle which we support.
Just social transition is a challenge in the context of the environmental transition and the digitalisation of the economy, economic diversification, and business models transformation. The European Pillar of Social Rights aims to ensure justice in the daily life of all citizens, whether they are students, workers, job-seekers or pensioners; whether they live in an urban or a rural area; irrespective of their gender, race or ethnic background, religion or beliefs, physical or mental disability, age or sexual orientation.
In addition to the efforts to counter inequalities, particular attention should also be given to the labour market. Developing a qualified and sustainable workforce that is prepared for the transition to a green and digital economy requires investments in education, training, qualifications, and qualifications upgrade. Skills are crucial for the future. Given the ever more frequent job changes and the flexible work models, people need continuous learning. According to forecasts, half of the current workforce will have to upgrade their skills over the next five years. Education and training are crucial to skills. We insist on changes in the national education and training system with a view to providing inclusive, high-quality education and training. One of the priorities of the European Pillar of Social Rights will be the application of an updated European skills programme.
The mitigation of the consequences from the deteriorating demographic situation across Europe can be achieved by means of an integrated approach based on a combination of policy solutions in terms of pensions, social security, long-term care, healthcare systems, social inclusion, education and childcare.
The European small- and medium-sized enterprises are all around us: their number is approx. 24 million, and together they amount for 99% of all companies in the EU. Over time they have secured the vast majority of new jobs, and European societies rely on them to a large extent. While the significance of our SMEs has always been acknowledged, COVID-19 has made us aware of how vital they are, in particular in the context of the crisis which put a huge number of SMEs in a precarious financial situation: many of them were forced to close down, and millions of jobs are still at risk. Improving the access to financing for SMEs was important before the crisis, and now it has become crucial to their survival.
The increased 2030 climate goals will include in-depth impact assessments, and will evolve hand in hand with the EU decarbonization fund which will facilitate the transition of SMEs to climate-neutral business models; in parallel, the just transition fund will be expanded to also cover SMEs in regions with high dependence on fossil fuel production – such as Galabovo municipality – in order to help them restore their competitiveness.
Moreover, we have to keep in mind that SMEs are at the centre of the double transition to a green and digital Europe, and are a vital source of creativity and innovations, in other words they contribute to the future sustainable development of Europe. One thing is for certain: our start-ups, entrepreneurs and SMEs will be at the core of recovery.
The comprehensive strategy of the Green Deal offers a huge range of opportunities, but it is highly probable that some key actions will not be appropriate for SMEs. In spite of EU’s pursuit to step up its “climate diplomacy” at the international level with the aim to contribute to the implementation of the Paris Accord, the main components of the Green Deal should be in line with the specifics of SMEs in order for the Deal to be successful. Hence, the Green Deal is a growth strategy with a focus on EU’s future competitiveness, and allows innovative and environmentally-friendly SMEs to design and put in place technologies needed to counter climate change within and outside the EU. Furthermore, is aims to assist traditional and energy-intensive SMEs with their successful transition to more sustainable business models.
The COVID-19 pandemic has clearly demonstrated that keeping the Single Market fit for purpose is essential to the EU. The crisis has highlighted the crucial role of transport, and of social, health and economic costs in a situation where the free movement of people, goods and services is strongly restricted or even entirely disrupted. Maintaining the supply chains and the coordinated European approach to connectivity and transport activities is crucial in overcoming any crisis and strengthening EU’s economic autonomy and stability.
Taking into account the big share of transport in the total amount of greenhouse gas emission in the EU, the EU target to reduce GHG emissions by at least 55% by 2030 and achieve climate neutrality by 2050 can be attained only by means of more ambitious policies to urgently lower the dependence of transport on fossil fuels and via useful interactions with the efforts to achieve zero pollution. The success of the Green Deal is contingent on our capacity to ensure sustainability for the whole transport system.
The coverage and the quality of Bulgaria’s transport infrastructure are still below the EU average, and the Trans-European Transport Network has not yet been completed. The network of multimodal platforms, some railway and road sections, and the European Rail Traffic Management System and the Intelligent Transport Systems are still underdeveloped. In this context, a focus is needed on important environmental issues which are relevant to sustainable growth.
The EC Sustainable and Smart Mobility Strategy – preparing the European transport for the future – explicitly points out that achieving the goals of the Green Deal requires a shift from gradual changes to a major transformation. Hence, the Strategy sets out 10 priority areas and an action plan with a number of mid-term objectives showing the way forward for the European transport system in attaining our goals for sustainable, smart and stable mobility, and thus highlights the level of ambition for our future policies.
The Green Deal urges that a substantial part of the domestic freight transport be shifted from the land infrastructure to railway transport and inland waterways. Thus, enhanced multimodality – interconnectivity among road, rail and inland water (river) transport – could help strengthen the sustainability of all modes of transport.
The EU cannot rely exclusively on technological solutions: in order to cope with climate change and lower pollution we must take urgent actions for the adaptation of our mobility system. Multimodality offers benefits deriving from the strengths of the various transport modes such as, for example, comfort, speed, tariffs, reliability, predictability, and the combination thereof can provide more efficient transport solutions for people and goods. COVID-19 has also illustrated the key relevance of enhanced multimodality for improving the stability of our transport system, and the citizens’ willingness to accept and apply sustainable alternative ways of movement. Nowadays Europeans are ready to switch to more sustainable modes of transport, in particular in the context of their daily mobility, the main preconditions for this switch being price, availability and speed.
The increased introduction and use of renewable and low-carbon fuels should be implemented in parallel with the development of a comprehensive network of charging infrastructure, which will secure the full potential for the large-scale deployment of low- or zero-emission vehicles in all transport modes. Recharge and Refuel is a flagship EU initiative within the framework of the Recovery and Resilience Facility: the aim is that by 2025 half of the total of 1,000 hydrogen stations be in place, and 1 million of the total of 3 million public charging stations needed by 2030. In the context of the upcoming revision of the Directive on Alternative Fuels Infrastructure the Commission will consider options for the targets related to infrastructure deployment which will be more binding, as well as additional measures to ensure full interoperability of the infrastructure and services for all vehicles using alternative fuels.
Cities have played and should continue playing a pivotal role in the transition to increased sustainability. The Commission will step up its commitment to the cities and Member States in order to make sure that all large and medium cities that are TEN-T nodes will have implemented their own plans for a sustainable urban mobility by 2030. These plans should set out new targets, for example, for zero emissions and zero traffic fatalities. As the use of active transport modes such as cycling has been on the increase, an additional cycling infrastructure of over 2,300 km has been allocated. This figure should be doubled up to 5,000 km in the form of safe bike lanes in the next decade. Furthermore, the Commission is considering a mission in the area of climate-neutral and smart cities as a strategic priority for joint actions in achieving decarbonatization in many European cities by 2030.
In 2020 the European Union, specifically the European Commission, the European Parliament and the Council of the European Union, took unprecedented measures to curb the health crisis, as well as to overcome the economic consequences and pool joint efforts for the recovery of the European economy. Decisions were made with regard to the architecture of the Multiannual Financial Framework, the Recovery and Resilience Facility, the New Generation EU framework. These tools recognize and put at their core the Digital Deal and the Digital Transformation as the two sides of one single process of recovery via transformation.
The European Parliament played an essential role by giving its categoric support for the Green Deal and New Generation EU by means of a number of resolutions; the EP was at the heart of the decisions regarding the rule of law, improved coordination among the EU financial facilities, launching the Conference on the Future of Europe, and introducing a mechanism for synchrony in joint actions by the Council and the Parliament, with the support of the Commission. The European Parliament did not only support but also put maximum efforts into the expeditious and efficient decision-making and promotion of innovative positions. A leading role was played by Renew Europe which has uncompromisingly pursued its mission to overhaul the institutions, improve their operation, and promote the connection with the European citizens, as a major priority for and a corrective to the functioning of the European Union.
Authors:
Ilhan Kyuchyuk
Iskra Mihaylova
Atidzhe Alieva-Veli