How to green for Europe | Latest news The Moscow Post
28 September 2021

How to "green" for Europe

Do they want to carry out environmental reforms at the expense of Russia?

Gref and Chubais "raise a wave"

Strictly speaking, the WTO is designed to promote free trade, reduce tariffs and protect competition. But the organization did not protect Russia from sanctions, other attacks in economic ties with the West. And she helped in something. The organization, accepting Russia into its composition, made no promises to help the Russian economy. They say that the WTO even proposed limiting the production in the Russian Federation of "too cheap" hydropower, which successfully competes with European, the correspondent of The Moscow Post reports.

The negotiator from the Russian Federation on accession to the WTO Maxim Medvedkov explained to Western partners that this happened due to the presence of "very large Siberian rivers." Today, this sounds ridiculous, especially in the context of Europe's transition to a "carbon-free economy" by 2050.

The petrel of the economic collapse of the 1990s, Anatoly Chubais, claims that this "green transition" of the European Union threatens Russia with a loss of up to 9% of GDP. Not immediately, but threatens. The lesser-known reformer German Gref, who successfully settled Sberbank, also does not skimp on forecasts. According to his estimates, if the European carbon neutrality scenario is successfully advanced, Russians expect a 14% drop in income by 2035. The total loss of the budget of the Russian Federation can amount to 5 trillion rubles.

According to Sberbank estimates, GDP losses can amount to 4.4%, and real incomes of the population will decrease by 9%. This, if you do nothing, added the head of Sber. He kept silent about "what to do," but called for "ESG transformation." This is when banks lend to investors taking into account environmental, social and managerial standards, change the direction of cash flows due to underfunding of "harmful industries." Bankers should calculate risks, make money, while increasing their fame.

Pedestal for Ursula

The President of the European Commission, a staunch feminist and mother of seven children, Ms. Ursula von der Leyen, also decided to increase fame. In December 2019, the European Union, at the initiative of the European Commission, approved the so-called Green Deal. In 2021, Ms. von der Leyen led the offensive "on users" of the atmosphere and proposed to reduce SO2 emissions by 55% of the 1990 level by 2030 (today the EU has 76%). She herself, as they say, came up with the name of the plan - Fit for 55 (Ready for 55). The document proposes to establish a threshold for greenhouse gas emissions, to produce 40% of energy by 2030 from renewable sources. So far, this figure is about 10%, but in 2020, projects (RES) accounted for the bulk of new generating capacities. The share of RES in electricity supply increased to 40%.

The European Commission announced its proposals in July 2021, estimating their annual value, reportedly at 260 billion euros. Similar steps were taken by Washington and London. Joe Biden called his program modestly: "American Job Creation Plan." British Prime Minister Boris Johnson proposed a "Ten-Point Plan for a Green Industrial Revolution."

The Fit for 55 plan, observers say, "will mean nothing to countries outside the Brussels bubble." Others note that in Europe itself, the plan does not suit many. At a meeting of the European Council in May, the leaders of Slovenia, Latvia, Poland and Luxembourg announced their disagreement with the proposal to extend emissions trading to transport and buildings. Finland promised to formulate a position on each of the thirteen Fit for 55 legislative proposals in the fall, when parliamentarians will return from vacation.

Inside the Brussels Bubble

So far, the Finnish Ministry of European Affairs has drawn attention to the shipping sector. Finland's foreign trade is 80% dependent on shipping. At the same time, in trading emissions quotas, shipping in winter must be taken into account. With an emission quota cost of 50 euros per ton of SO2, shipping will rise in price for Suomi by 300 million euros per year by 2026. The Union of the Automotive Industry said that the production of fully electric cars will be 1.5-1.6 times more expensive than cars with internal combustion engines. Finnair announced the risks of raising air ticket prices.

The Finnish Forest Industry Association noted the absence of a reference to forest bioeconomics in the document. The list of raw materials for the production of bioethanol may not include sawmill waste.

In Warsaw, climate policy can become a domestic policy problem. Coal provides about 40% of Poland's heating needs, and miners still remain a political force. Also raising questions are plans to stop 32 nuclear reactors in France, Germany, Spain and Belgium by 2035. They provide electricity without CO2, their installed capacity is almost 32 GW. The Czech Republic and Hungary demanded that nuclear energy be classified as environmentally harmless.

In a green economy, some familiar jobs may disappear. There is no avoiding an increase in prices for automobile fuel, air travel and utilities. This threatens the positions of political parties. Protests by the type of action of the "yellow vests" cannot be ruled out. European governments have yet to work out the details of a new climate program, writes the Financial Times. The plan was almost not discussed at all outside the Brussels offices. Frans Timmermans, deputy Von der Leyen, said that if the "green deal" is not perceived as fair, then it simply will not! Finally, he said that achieving "carbon neutrality" by 2050, even within Europe, will be "damn hard."

"We cannot allow Brussels bureaucrats to saddle poor people and poor countries at the cost of combating climate change," warned Viktor Orban, Prime Minister of Hungary. It turns out that Gref and Chubais are running ahead of the "Euro-climate steam locomotive"? Even if their fears are justified in something, why put Russia in the position of a "victim" counting losses even without negotiations?

Devil in detail

Such politicians as the former Minister of Defense, who, by the way, mastered the specialty of a gynaecologist, do not put your finger in your mouth! It is believed that Ursula von der Leyen decided to turn her department from a political backstop of regional economic integration into an instrument of geopolitical influence.

Of all the draft laws of the Ready for 55 program, a mechanism for transboundary carbon regulation is distinguished. This idea provides for import charges on products imported to EU countries, depending on their carbon footprint. As part of the first three-year stage of TUR implementation, imported steel (including pipes and rails), cement, fertilizers and aluminum will be subject to fees. Companies will begin to pay customs duties only in 2026.

By introducing such a mechanism, the European Union will protect its manufacturers, since due to tighter regulation within the EU, the costs of local companies will increase. They will be required to pay carbon footprint fees from their own products. The EU intends to equalize their competitive positions with manufacturers from countries with less stringent regulation. How and by whom the degree of "rigidity of regulation" will be determined is not yet clear. So far, European companies receive benefits that exempt them from buying emissions quotas. But as the TOUR mechanism is introduced, local producers will be deprived of these privileges. The TUR mechanism, as conceived by its designers, can also encourage EU partners to reduce the carbon footprint of export products, reducing emissions.

The current CO2 Emission Trading System (ETS), which has set the maximum annual emissions since 2005, will continue. Thea, however, "is still far from climate neutrality, consensus on this goal should not hide the fact that real conflicts are already raging under the blanket of green euphoria," the Tagesspiegel newspaper noted.

Competition and inequality

In theory, the introduction of Fit for 55 measures will make it difficult to transfer production from Europe to other countries with less stringent environmental regulation. It is noteworthy in this regard that China, the main investment facility for European companies, in 2020 added almost 30 gigawatts of coal-fired generating capacity. In India, about 60 GW of such facilities are under construction. The Southeast Asia region from Indonesia to Thailand, from Vietnam to China, accounts for more than half of global energy demand. All the largest economies in the region still rely on coal.

Europe and the US are spending billions to cut emissions, and Asian countries are increasing them. They repeat the path that Europeans and Americans, now responsible for a third of global SO2 emissions, have already taken. But the gap in energy consumption per capita remains. An Indian consumes one tenth of the energy consumed by an American.

In fact, it was the industrial revolution, the ideology of the consumption society promoted by the West, that caused the main share of damage to the environment. Now, the Western commercial-environmental lobby is looking for influence tools to preserve a comfortable habitat, primarily for itself.

Greening military budgets

Climate change has become a big policy issue. The "locomotive countries" of the proposed green transformation avoid estimating the cost of the entire mega-project. According to estimates, Sberbank on a planetary scale, "carbon neutrality" will cost about $140 trillion. With such funds for "landscaping" the atmosphere, two-thirds of the world's energy consumption by 2050 will be possible at the expense of renewable energy, German Gref believes.

For comparison, in the current year 2021, defense spending by all countries of the world will exceed $2 trillion. This is an area where even the poorest and smallest states do not save money, budgets do not optimize, give the last. For example, in 2020, the poorest of the European countries, Ukraine spent about $6 billion on military purposes. The most "safe" Switzerland spent under the article "Security" 7 billion dollars. The most "vulnerable" America spends a hundred crats more!

The Pentagon, for example, is the largest polluter in the world and the United States has always insisted on exempting the military from any climate agreements. At the same time, one bomber "B-52" consumes in one hour as much fuel as the average car consumes in seven years. It would be necessary to calculate the indicators for at least one aircraft carrier group of the US Navy.

Stockholm International Peace Research Institute (SIPRI) estimates the share of military spending in world GDP at 2.4%. These costs are growing, in 2019 they amounted to 2.2% of global GDP. The defense spending of the country of the "community of democracies," including the European Union, the USA, Canada, as well as Japan and Australia, is financed by more than half of the "global military budget." They are responsible for about a third of global SO2 emissions.

The Green Transition, if Sberbank estimates are used, will require the mobilization of two or more "global military budgets" annually in the next 30 years. For the collective West to take on half the investment in climate projects (according to its share of global military spending) would be fair. Is this real? Meanwhile, Russia invited the European Union to clarify the principles of the formation of "climate" customs duties on imports into the EU of certain categories of goods. This was stated by Russian Foreign Minister Sergei Lavrov.

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