Home Europe The EU greenwashed fossil gas. Today, we are suing.

The EU greenwashed fossil gas. Today, we are suing.

by editor

Last July, EU policymakers decided to greenwash fossil gas. Today, the WWF European Policy Office, Client Earth, BUND and Transport & Environment are taking them to the European Court of Justice.

We are doing it to reassert a basic truth: all fossil fuels are dangerous for the planet. Only last summer, European cities baked under fierce heatwaves, rivers across our continent ran dry, and whole swathes of France, Spain, and Portugal were burned by unprecedented wildfires. In the midst of this devastation, the EU approved a new chapter of its supposed green investment guidebook — the EU Taxonomy — which stated that fossil gas-fired electricity is ‘green’. In fact, fossil gas is a fossil fuel that can cause plumes of methane that harm the climate just as badly as coal.

However, under the guise of climate action, the gas Taxonomy could divert tens of billions of euros from green projects into the very fossil fuels which are causing those heatwaves, droughts, and wildfires. This is while scientific experts at the International Energy Agency and the United Nations continue to stress that we must halt any expansion of fossil fuels and invest exclusively in developing clean energy sources. Even the EU’s own experts have said we must use much less gas by 2030. The gas Taxonomy is not just at odds with the science: it also flies in the face of market dynamics. Renewable investments across the world reached $500 billion last year, which shows that there is already a massive, readily available alternative to gas-fired power.

For all these reasons, having previously filed a request for the Commission to review the gas Taxonomy, we are filing a case at the CJEU today. We will argue that the gas Taxonomy, and the Commission’s refusal to review it, clash with the European Climate Law, the precautionary principle, and the Taxonomy Regulation — the law on which the Taxonomy is built. It also undermines the EU’s obligations under the Paris Agreement. We expect a judgment within the next two years.

Fossil gas at the heart of two European crises

Europe faces two interlocking crises: an inflation crisis and a climate crisis. Fossil gas is at the heart of both. Had we decided to invest with more determination in renewables and energy efficiency even just 10 years ago, our continent would not have been so dependent on energy imports. We would not have faced such great spikes in energy and food prices, which disproportionately hurt our poorest citizens. We would be closer to meeting our Paris Agreement goals.

Instead,  largely due to decades of industry pressure — the gas lobby spends up to €78 million a year in Brussels alone — our continent has remained extremely dependent on destructive fossil fuels. That dependency must end. It is high time to direct billions of euros into installing more renewables more quickly, with a focus on secure, cheap wind and solar power. It is time to expand the technologies to back them up, such as building insulation, energy storage, and strong grids. And above all, it is time to stop the lie that putting money into any fossil fuel will help the green transition. That is the purpose of our legal case.

Policymakers and financial institutions beware

EU policymakers are increasingly inserting references to the EU Taxonomy into other policies. If our case is successful, and the Taxonomy’s gas criteria are overturned, any legislation tying gas financing to the Taxonomy would become inapplicable.

Policymakers beware: the Taxonomy is on shaky ground, and you should not use it to justify new gas investments. Fossil fuel companies that get hooked on green funding will face a rude awakening if our legal case cuts that support off. They may even incur steep losses if they have made investments based on EU policies only to find that gas has been struck out of them.

Fossil fuel companies that get hooked on green funding will face a rude awakening if our legal case cuts that support off.

Financial institutions also face real reputational, financial and legal risks from the gas Taxonomy. Fossil gas is excluded from the global green bond market. Leading institutions such as the European Investment Bank or the Dutch pension federation have openly criticized the Taxonomy’s greenwashing. What is more, taxonomies in several other countries exclude fossil gas-fired power, so the European one lags behind. Any financial institution that uses the EU Taxonomy to justify investing in fossil gas assets therefore risks direct, robust and repeated attacks on its reputation.

The inexorable public policy shift towards energy efficiency and renewables, and the plummeting price of wind and solar power, have made fossil gas-fired power uncompetitive. Investments in more fossil gas, even if encouraged by the EU Taxonomy, would quickly result in stranded assets and could even cause billion-euro losses. Financial institutions must guard against these risks by stopping their support for gas expansion now.

Finally, if our case is successful, financial institutions could find they have purchased or sold products mislabeled as ‘green’. They must be careful to verify the legal consequences of such an event, particularly for its impact on any climate claims they have made.

Our message to the EU

Policymakers and financial institutions should note that the Taxonomy faces four further court cases: one from the governments of Austria and Luxembourg, one from Greenpeace, one from the Trinational Association for Nuclear Protection (ATPN) and another from MEP René Repasi. The EU’s greenwashing is now being discredited from all sides – amongst scientists, in financial markets, and soon, we expect, by the judiciary.

Our message to the EU is simple: do not help fossil lobbyists to block our continent’s move to clean, cheap and secure energy. If you do, we will meet you head-on.

Victor Hugo once said that nobody can stop an idea whose time has come. Today, despite much fossil fuel lobbying, denial and delay, it is the turn of the green transition. Our message to the EU is simple: do not help fossil lobbyists to block our continent’s move to clean, cheap and secure energy. If you do, we will meet you head-on.

See you in court.

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