The European Union is making steady progress toward its climate goals, with new data showing it's on course to reduce greenhouse gas emissions by 54% by 2030. The European Commission (EC) plans to announce an even more ambitious 90% emissions reduction target for 2040 on July 2, a move that would further solidify the EU’s global climate leadership.

According to a recent assessment by the EC, updated climate action plans submitted by member states suggest the bloc is “well on track” to meet its near-term target of a 55% cut in emissions. However, this progress depends on countries following through on their promises despite growing political resistance to green policies and increased attention on defense spending.

“When we play our cards and instruments in a smart manner, we deliver as a continent,” said the Commission’s First Executive Vice President, Teresa Ribera. She stressed the high cost of inaction, noting that each unprepared climate disaster causes greater economic damage and social harm.

Despite the encouraging overall outlook, several gaps remain. The Commission highlighted persistent problems with energy poverty, lagging energy efficiency, and underperforming land-use strategies. The EU is still short of its goal to use forests and lands to absorb 310 megatonnes of CO₂ annually by the end of the decade.

“We’ve come a long way, but we’re not where we need to be,” admitted EU Energy Commissioner Dan Jørgensen.

Surprisingly, these figures come after months of concern that Europe was falling behind. In late 2023, reports suggested the EU was significantly off track to meet its 2030 target. However, in May 2024, the EU adopted a landmark regulation requiring 44 oil and gas companies to collectively store 50 million tonnes of CO₂ annually in geological formations by 2030.

“This is a critical piece of the EU’s climate strategy,” reads a report from Open Access Government. “It ensures that fossil fuel producers are accountable for emissions while helping to grow a new sector focused on carbon storage and industrial decarbonization.”

As far as the future is concerned, the momentum is building for the 2040 target. Over 150 businesses and investors, including major players like Allianz and Unilever, recently signed a joint letter urging the EU to adopt a 90% emissions cut. They argue that a strong target will give investors clarity, drive innovation, and support the development of sustainable industries.

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“A 2040 target of at least 90% provides long-term certainty to investors,” said Allianz board member Günther Thallinger. “Aligning national policy with climate science will help avert climate impacts. It will also unlock investment in sustainable infrastructure. We encourage policy-makers to deliver the clarity and ambition that investors are ready to support.”

Unilever’s Chief Sustainability Officer, Rebecca Marmot, added that deep emissions cuts are essential not just for the environment but for Europe’s competitiveness. 

The new 2040 target is expected to include a controversial clause: Limited use of carbon credits. This would allow EU countries to invest in certified emissions-reduction projects abroad, such as solar farms in developing nations, and count the reductions toward their own targets. Critics argue that such credits have historically delivered mixed results, though recent reforms at the COP29 summit aim to strengthen oversight.

To gain wider support for the 2040 plan, the Commission may allow a maximum of 3% of the emissions cut to come from external carbon offsets, provided they meet strict certification standards. Germany has already signaled its backing for the proposal.

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As the EU prepares for a critical July announcement, the message is clear: The continent is pushing forward on climate action, aiming high even amid political and economic challenges.

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Source: The Energy Mix