new economy

　　

A group of European Union powers has threatened to block the European Commission's plan to effectively ban internal combustion engines, challenging the bloc's climate change response. The EU is tweaking a number of green schemes to prevent fake "green" financing and excessive damage to existing industries.

Germany and Italy said this week they could block formal approval of a ban on internal-combustion engines at key meetings this week and next -- the 2035 agreement on zero emissions for new gas-powered cars and pickup trucks approved by the European Parliament on Feb. 14.

Germany has said it will not agree to the EU decision unless the commission agrees to the use of synthetic fuels, which can burn like petrol and diesel but reduce polluting gas emissions as much as all-electric vehicles.

Led by the European Commission, Europe has adopted an ambitious plan to tackle greenhouse gas emissions. The deal relies heavily on the mass adoption of electric vehicles and a ban on new internal-combustion vehicles from 2035. The agreement was formally proposed in July 2021, but given resistance from some countries and auto companies, the final version did offer some flexibility, including that smaller automakers with annual production of less than 10,000 vehicles could meet lower emissions targets by 2036. If the law is passed, new plug-in hybrid and regular hybrid models will also be banned from sale in Europe after 2035.

But parts of the auto industry have pushed back, arguing that the inclusion of synthetic fuels in the deal would both meet emissions targets and delay the costly shift away from internal combustion engines over the next few decades. These sectors employ 3.4 million people and account for nearly 12 percent of all manufacturing jobs in the EU.

In addition to Germany and Italy, two other countries did not support the deal. Poland has informed other member states that it is prepared to vote against the deal, four EU diplomats said. Bulgaria indicated it was prepared to abstain. The Polish government had argued that such a ban would limit consumer choice and lead to higher costs. If they act in concert, they have enough votes to derail the plan.

A Commission spokeswoman said it was up to the commission leadership to decide what legislative proposals to make and when. "The transition to zero-emission vehicles is absolutely necessary to meet the EU's climate targets," he said.

The European Union has made new progress in tackling climate change. European Union negotiators reached an agreement on standards for the world's first green bond issue on Tuesday evening, the European Parliament said in a statement. Companies using this set of green bond criteria must meet EU classification criteria or guidelines for sustainable projects, and the rules will enable investors to identify high-quality green bonds and companies.

The agreement, aimed at cracking down on "greenwashing" and "greenwashing" in the bond market, marks the first step towards regulating the asset class.

However, until the classification criteria framework is fully up and running, the European Parliament allows 15% of green bond proceeds to be invested in activities not covered by the rules. In addition, all companies that choose to use the standard when marketing green bonds will be required to disclose a lot of information about how the bond proceeds are used. The deal is subject to final approval by European lawmakers and EU member states.