Bulgaria, Poland and seven other countries step up pressure to allow EU natural gas funding

Poland, Bulgaria and seven other countries have stepped up efforts to ensure that natural gas is classified as a sustainable investment under EU funding rules, warning Brussels that the latest EC proposal will fail. This is clear from a document that Reuters was able to review. The European Union's so-called 'taxonomy' is a key part of the bloc's sustainable financing program, as it is expected to direct billions of euros to activities that will help Europe achieve decarbonisation of its economy by 2050.

The Commission had hoped to publish the rules on climate change-related parts of the taxonomy as early as January, but postponed this until April, recalls Euractiv. The reason was that countries and companies objected to the first draft of the rules, which refused to accept investments in gas-fired power plants for green investment and to label them accordingly.

A new draft proposal shows that the EC is now proposing to give some gas plants a sustainable label, but under strict conditions. However, the new proposal, which has not yet been published, turns out to be divisive. More than 200 scientists, financial experts and campaigners have called on the Commission to stick to the idea and turn off natural gas, which they say is crucial to align the taxonomy with scientifically sound goals to prevent catastrophic climate change.

Meanwhile, nine countries, including the Czech Republic, Croatia, Cyprus, Greece, Hungary, Malta and Romania, presented a joint document opposing the new proposal. This group, plus Slovakia, also opposed the Commission's first proposal for a lack of support for natural gas projects.

The group said the new proposal ignores the individual needs of EU member states - with many signatories planning to use gas to replace more polluting coal. The parties have asked the EC to give more gas plants a similar "green label". "Investments considered 'sustainable' today should not become 'unsustainable' overnight because they are not included in the list or do not meet the definition of a taxonomy," the group said in a letter.

The EC has proposed an emission threshold of 100 grams of CO2 for each kilowatt-hour produced at gas-fired power plants, so that these capacities are qualified with a sustainable label. But the group of countries said that this threshold should be lowered to a "technically feasible" level.

The Commission's latest proposal intends to give a green label to combined heat and gas plants if they miss the low-emission target but have complied with other rules, including the closure of their polluting old CHPs. This support is given on condition that the countries build their gas power plants by 2025. But these are not sufficient mechanisms, the countries are adamant. That deadline is too early, the nine countries said, as some countries have already announced plans to phase out their coal-fired power plants at a much later stage.

An EU diplomat, who opposes any relaxation of the rules, said it would essentially undermine the purpose of the taxonomy. "This further risks moving away from a science-based taxonomy to a lobby-based taxonomy," explained the Euractiv source.