Billions of euros to develop renewable energy and cut emissions have been threatened with cuts after EU leaders proposed diverting them to fund immigration measures – Politico reports.
Despite support from France, Italy and Spain, Brussels is facing criticism from leaner European capitals, particularly in the north, who want to limit their contributions to the EU budget and ensure money is available to curb illegal immigration and rising military spending.
It came during a summit of EU leaders in Brussels this week, where European Council President Charles Michel proposed cutting almost all of a €10 billion fund designed to help Europe create the energy networks of the future – wind turbines, hydrogen plants, carbon capture. So Michel’s compromise would cut the renewable energy fund – officially called the Strategic Technology Platform for Europe, or STEP – to just 1.5 billion euros.
In exchange, Brussels would offer countries more flexibility in using payments from the EU cohesion fund – a budget injection for low-income states designed to reduce economic inequality.
“This allows countries with access to European funds to use them in a simple and flexible way,” one of diplomats said about the whole situation.
The potential cut in funds is a worrying signal that Europe is increasingly struggling to attract the massive investment needed to meet its climate goals. Germany, Europe’s largest economy, was also recently forced to drastically cut its climate budget following a court ruling.
Portuguese Prime Minister António Costa, for example, issued a statement to his fellow EU leaders about his disappointment with the cuts. Also, Bulgarian Prime Minister Nikolay Denkov suggested that unused funds from the EU’s pandemic recovery fund be diverted.
“Previously, you could guesstimate that around 50 per cent of STEP funds would go to climate, and now you can guesstimate it will be around 0 per cent: that money could go from 5 out of 10 billion to 0 out of 1.5 billion,” said Thomas Pellerin-Carlin, director for EU climate investment and cleantech at the Institute for Climate Economics, warning of the catastrophic consequences for the cleantech industry.
The EU could allocate less money to clean tech in 2024 than it did in 2022, which of course goes against the European Parliament’s repeated calls for STEP to receive more funds, not less.
