EU Climate Action and U.S.-EU Relations

EU Climate Action and U.S.-EU Relations

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Updated November 9, 2021
EU Climate Action and U.S.-EU Relations
The European Union: A Key Actor
 More Ambitious Climate Goals. In 2020, the EU
The European Union (EU) has played a leading role on
committed to reducing GHG emissions by at least 55%
international climate action for decades. It worked closely
from 1990 levels by 2030, both in the EU context and in
with the United States to negotiate the 2015 Paris
its Nationally Determined Contribution (NDC) under
Agreement (PA) to combat greenhouse gas (GHG)-induced
the PA. The EU also has committed to a climate-neutral
climate change. Since 2019, the EU has raised its domestic
economy (no net GHG emissions) by 2050.
climate ambitions further and, in doing so, has sought to be
 Fit for 55. Unveiled in July 2021, this initial package of
a global standard-setter. The EU welcomed President
Biden’s decision to rejoin the PA (reversing the U.S.
16 legislative proposals and policies aims to meet the
EU’s 55% emissions reduction goal and to implement
withdrawal carried out by the former Trump
measures linked to the European Green Deal.
Administration). Both EU and Biden Administration
officials repeatedly assert the importance of U.S.-EU
Specific legislation to help implement the European Green
cooperation in tackling climate challenges. The 117th
Deal and Fit for 55 must be approved by the member states
Congress may compare EU climate action policies with
(acting in the Council of the EU) and by the European
Biden Administration plans and may assess prospects for
Parliament to become EU law, a process that can take two
and challenges to U.S.-EU cooperation on climate change
years or more. The EU also has pledged to put “green”
mitigation efforts in the years ahead. (Table 1 compares
policies at the center of its Coronavirus Disease 2019
selected U.S. and EU GHG emissions indicators.)
(COVID-19) economic recovery plans. Of the EU’s €2
trillion (about $2.3 trillion, in current prices) pandemic
Table 1. Selected GHG Emissions Indicators for 2018
recovery and 2021-2027 budget package, 30% of total

EU-27
U.S.
expenditure is to be devoted to climate objectives.
Total GHG Emissions
3.5 Gt CO2e
5.9 Gt CO2e
EU GHG Emissions Reduction Target
GHG Emissions per Capita
7.9 t CO2e
18.1 t CO2e
The EU negotiates on behalf of its member states in the
GHG Emissions per Mil ion
220 t CO
U.N. Framework Convention on Climate Change,
2e
287 t CO2e
$ GDP
including the Kyoto Protocol (KP) and the PA. Under the
KP, the EU met or surpassed its 2008-2012 and 2013-2020
Share of Global CO2
8.4%
14.7%
GHG reduction obligations (see Figure 1). In 2020, the EU
Energy-Related Emissions
updated its commitment in its NDC from an aggregate
Sources: World Resources Institute, Climate Watch 2021; International
target of at least a 40% reduction in GHG emissions by
Energy Agency, Key World Energy Statistics 2020.
2030 to at least a 55% reduction (below 1990 levels). To
Notes: CO2e = carbon dioxide-equivalent: the tons of carbon dioxide
fulfill the EU’s collective NDC, each EU country agrees to
that would have the equivalent effect of 1 ton of the GHG on forcing
a distinct target that is legally binding within the EU
global average temperature. Units are metric: t = metric ton; Gt =
context. The EU’s NDC target covers all GHG not
gigaton. EU data is for the EU’s current 27 member states; they exclude
controlled by the Montreal Protocol on Substances That
the United Kingdom (which withdrew from the EU in 2020).
Deplete the Ozone Layer, including carbon dioxide (CO2)
and methane (CH
EU Climate Policies
4), from the energy sector, industrial
processes, product use, agriculture, waste, and net removals
The 27-member EU designates environmental policy—
by land use, land-use change, and forestry (LULUCF).
including climate action—as an area of shared competency
Many in the EU view the new minimum 55% emissions
in which both the EU and its member states may adopt
reduction target as key to helping the EU reach its 2050
legally binding acts. All EU members must abide by agreed
EU laws and regulations on climate action, and national
climate-neutrality goal and as significant for overcoming
years of resistance from Poland and other members more
laws or policies must not conflict with or undercut common
EU measures. Headline EU initiatives include
reliant on coal and fossil fuels. Environmental groups and
some Members of the European Parliament (MEPs),
 The European Green Deal. A multipronged approach,
however, contend the new target remains insufficient to
launched in December 2019 by the European
hold global warming to the levels called for in the PA.
Commission (the EU’s executive), to address climate
Some EU countries likely will need to make structural
change and other environmental challenges, while also
changes to meet their shares of the EU’s 2030 targets; they
promoting resource-efficient economic growth and
may do so in part by acquiring extra GHG reductions from
innovation. A just economic transition for all segments
other EU member states. For some, such as Belgium and
of European society is integral to the initiative.
Germany, reducing GHG emissions is made more difficult
by policies to phase out nuclear power generation.
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EU Climate Action and U.S.-EU Relations
Figure 1. EU Historical GHG Emissions, EU-27 Future Targets, and Emissions Projections

Source: CRS using European Environment Agency (EEA), Total Greenhouse Gas Emission Trends and Projections in Europe, 2020; Kyoto 2nd Commitment
Period (2013-20); and European Commission, 2050 Long-Term Strategy.
Notes: The EU’s Kyoto Protocol (KP) targets were 8% below 1990 emissions levels (average 2008-2012) and 20% below 1990 levels (average 2013-
2020). For KP compliance, EU official net emissions, including acquired international offsets, were below the target levels in both periods. The EU’s 2030
Enacted Target is at least a 40% emissions reduction below 1990 levels. The EU’s updated 2030 Nationally Determined Contribution (NDC)
Target is at least 55% below 1990 levels. “With Existing Measures” (WEM) projections count existing domestic policies; “With Additional Measures”
(WAM) projections include planned domestic policies. For 2050, the EU has adopted a Net Zero Vision of “climate neutrality.”
Key EU GHG Mitigation Efforts
electricity. The European Commission asserts that the
A key EU GHG mitigation policy centers on reforming and
“overarching objective” is to “fight climate change by
expanding its emissions trading system (ETS), begun in
reducing GHG emissions in the Union and globally.” Some
2005. The ETS caps CO
experts suggest the EU is seeking to leverage its trading
2 emissions from the electricity
sector, certain energy-intensive industries, and aviation
relationships to persuade countries to adopt more robust
within Europe. The Fit for 55 package proposes measures to
climate policies.
strengthen the ETS, expand it to the maritime sector, and
U.S.-EU Cooperation and Challenges
create a second ETS for fuels for road transport and
building heating. Some member states and MEPs express
At a June 2021 summit, the United States and the EU
concern about increased energy costs to households and
identified the goal to “protect our planet and foster green
consumers. Fit for 55 includes plans for a €72.2 billion
growth” as one of four priority areas for cooperation. The
(about $84 billion) Social Climate Fund to provide
two partners committed to work together on implementing
temporary income support to vulnerable households and to
the PA, sustainable finance, and the development of green
help finance investments in energy efficiency.
technologies, among other issues. In September 2021, the
United States and the EU announced the Global Methane
The EU also views transitioning to “cleaner” energy as
Pledge to reduce global methane emissions by at least 30%
crucial to reducing emissions. Fit for 55 calls for adopting
from 2020 levels by 2030. Over 100 countries have joined
stricter energy efficiency and renewable goals for 2030,
this initiative, officially launched at the 26th U.N. Climate
including raising the portion of renewables in the EU’s
Change Conference (COP26) in November 2021.
energy mix from 32% to 40%. Fit for 55 also proposes
reducing CO
Despite renewed U.S.-EU efforts to cooperate on climate
2 emissions for new cars and vans by 100% by
2035. Other measures in Fit for 55 include enhancing
action, some challenges remain. U.S. officials express some
emissions reduction targets in sectors outside the current
concerns about the EU’s proposed CBAM, including
ETS, strengthening existing EU legislation on LULUCF,
possible trade implications. Tensions have arisen over
new initiatives to promote sustainable aviation and
anticipated changes to EU food and agriculture policies that
maritime fuels, and a new EU Forest Strategy.
are part of the European Green Deal’s Farm to Fork (F2F)
and Biodiversity Strategies. U.S.-EU views also may differ
Carbon Border Adjustment Mechanism
on sustainable finance standards and regulation.
As part of Fit for 55, the EU proposed a carbon border
Kristin Archick, Specialist in European Affairs
adjustment mechanism (CBAM)—which would put a
Jane A. Leggett, Specialist in Energy and Environmental
carbon price on imports of selected products—to reduce
Policy
risks to EU competitiveness and avoid risks of emission
shifts to countries with less ambitious climate policies. To
Kezee Procita, Senior Research Librarian
be phased in from 2023, the CBAM would apply initially to
IF11431
imports of cement, iron, steel, aluminum, fertilizers, and
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EU Climate Action and U.S.-EU Relations

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