The Socialists and Democrats welcome the European Commission’s proposal to cut EU greenhouse gas emissions by 90% by 2040 – an essential milestone towards achieving climate neutrality by 2050 and mitigating the devastating impacts of global warming.

However, the inclusion of international carbon credits as a means to meet the target carries considerable risks. The S&D Group has long expressed caution regarding such mechanisms, based on past experience, as they will shift focus away from the urgent task of decarbonising Europe’s own industries – a key pillar of our climate strategy.

Mohammed Chahim, S&D vice-president for the Green Deal, industry, energy and climate, and financing the Just Transition, said:

“The Commission’s proposal is a long-awaited step, but the S&D Group warns against the risks associated with the inclusion of international carbon credits. Achieving the 2040 target through domestic action will strengthen Europe’s long-term competitiveness, energy autonomy, drive clean tech innovation, and support a just transition for our citizens. International carbon credits undermine these benefits, and can therefore only be used as a last resort. It’s vital for the S&D Group that upcoming legislation is aligned with a 90% domestic target.

“Given the high expectations from the public and the fact that the scientific consensus on the need for action has been clear for some time, it is all the more regrettable that the Commission has waited until now. This hesitancy has put Europe’s position as a global leader on climate under significant strain.

“We are committed to working constructively with the Council to meet the climate emergency head-on. It’s also vital for the EU to adopt an ambitious updated climate target ahead of the UN climate summit in Brazil this November, as European climate leadership is needed now more than ever.

“We will not accept any attempt to delay or dilute our commitment to climate neutrality in 2050, in line with the Paris Agreement.”

Tiemo Wölken, S&D coordinator in the European Parliament's committee on the environment, climate and food safety, said:

“With over 80% of Europeans viewing climate change as a serious threat, the EU must act boldly to meet these expectations. The publication of this proposal therefore marks an important step.

“Setting a 90% reduction target by 2040 is not just scientifically sound – it’s a realistic and ambitious pathway to reach climate neutrality by 2050. Investors, companies – and not least citizens and families – need long-term policy stability to make reliable investment and purchasing decisions that are sure to pay off over time.

“While we welcome the 90% net reduction target, we regret the optional inclusion of up to 3% in international carbon credits, which has the potential to open a Pandora's box of loopholes and uncertainties for the EU's climate target architecture. The risks, both in diverting resources away from EU industry and in the uncertain environmental integrity of such credits, are immense. If we go down this road, it must be ensured that the credits truly represent verifiable, permanent emission removals only. Furthermore, the use and accounting of these credits must be tightly safeguarded as well. Past experience clearly shows that the inclusion of such credits in the ETS can be particularly harmful, for example.”