Natural gas and nuclear energy have been included in the European Union’s (EU) taxonomy as sustainable investments for the private sector, the European Commission has said.
In a Taxonomy Complementary Climate Delegated Act on climate change mitigation and adaptation, the European Commission has included natural gas and nuclear energy in its plan for building a climate-friendly future, labelling investments in natural gas and nuclear projects sustainable under certain conditions.
“The inclusion of nuclear and natural gas in the taxonomy comes with conditions associated with their use and with safeguards against significant environmental harm,” the European Commission said in a tweet earlier this month.
“Investors must be able to clearly recognize if an investment includes natural gas or nuclear activities and to what extent, so they can make an informed investment decision,” it added.
As public investment will not be sufficient to finance the EU’s transition towards carbon neutrality, its taxonomy is a tool designed to signpost the way for private investments that will help the bloc to realize its ambition.
“It is our common grammar for financial markets to know what is green or not, and what is useful for the transition without being green,” said Pascal Canfin, Chair of the Environment committee of the European Parliament.
However, there have been concerns about the inclusion. The Climate Action Network Europe expressed its “concern at the proposal that fossil gas and nuclear energy be included in the EU Taxonomy”.
“The inclusion … would not only mislead consumers and investors, but would also call into question the extent to which the European Commission values scientific evidence,” it said in a letter addressed to European Commission President Ursula von der Leyen.
Natural gas and nuclear energy “are activities that cannot yet be replaced by technologically and economically feasible low-carbon alternatives, but do contribute to climate change mitigation and with the potential to play a major role in the transition to a climate-neutral economy”, the EU elaborated in a press release.