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Beginning decades ago, Europe went wholeheartedly into “net zero carbon by 2050” by implementing carbon reduction policies that eventually raised prices dramatically, putting more residents into energy poverty and causing industry to flee to areas where they could remain competitive. The United States under President Biden’s leadership is following in those footsteps at a rapid pace through legislative initiatives (e.g. the Inflation Reduction Act) and regulatory action such as EPA’s power plant rule and efficiency standards for vehicles which are forcing electric vehicles on the American public. But, now that the Europeans are starting to see the impact of their net zero carbon policies and people are rebelling in the streets of Paris and farmers on the roads in the Netherlands, European lawmakers are starting to say “whoa.” But, not the Biden administration.

The Beginnings

The European Union has been at the forefront of the fight against the energy sources which enabled their wealth and the climate change they insist is linked, but it is now under pressure to pause new environmental efforts amid fears they will hurt the economy. Some leaders and lawmakers are concerned about antagonizing workers with new binding legislation and restrictive measures and are urging the 27-nation bloc to hit the brakes. The European Union (EU) had adopted a wide range of measures, from reducing energy consumption to sharply cutting transport emissions and reforming the EU’s trading system for greenhouse gases. French President Macron even suggested people were facing “the end of abundance.”

Current Issues

Earlier this year, however, Germany delayed a deal to ban internal combustion engines in the EU by 2035 due to disagreements within its economy. The auto industry in Germany employs about 786,000 people. Last fall, Germany had signed an EU target to ban the sale of internal combustion engine cars by 2035, but the country opposed the idea earlier this year, along with Italy, Poland, and the Czech Republic. Germany’s transport minister is asking what the point is in pushing electric vehicles if the power that drives them comes from burning coal, as Germany has closed all its nuclear plants and is unable to get sufficient power from wind and solar to meet demand.  Germany is tackling its reduction in natural gas supplies from Russia by re-opening coal mines. In one case, a wind farm is being removed to dig for lignite. In March, EU reached an agreement to allow internal combustion engine vehicles to be powered by synthetic fuels manufactured from hydrogen and carbon dioxide, but these fuels are considerably more expensive than gasoline and their availability is limited. 

France recently called for a pause on EU environmental regulation. President Macron said it was time for the EU to implement existing rules before adopting new ones, as they could put France at a competitive disadvantage. He railed against those who still want to add standards and called for a new generation of nuclear reactors as France gets most of its electricity from nuclear power.

Belgium Prime Minister Alexander DeCroo called for a moratorium on the introduction of EU legislation aimed at nature preservation. The EU law proposed by 2030 to cover at least 20 percent of the EU’s land and sea with nature restoration measures, and eventually extend them to all ecosystems in need of restoration by 2050. According to DeCroo, climate legislation should not be overloaded with restoration measures or limits on agricultural nitrogen pollution, warning that businesses would no longer be able to keep up. The nature restoration law proposal would threaten agriculture and undermine food security in Europe by increasing food prices, require more imports and driving farmers out of business.  The government in the Netherlands has been seizing and idling farmers’ lands in the name of climate.

In Poland, ruling party leader Jaroslaw Kaczynski said the EU climate package was promoting “irrational solutions.” He vowed the government will fight for “a just transition” for the country.

The European Union lawmakers in Brussels decided to delay key parts of its Green New Deal after a party led by anti-Net Zero farmers came in first in Senate elections in the Netherlands in a huge upset.  EU lawmakers recently recommended weakening a proposal on industrial emissions and threatened to reject rules on pesticides and re-wilding land and seas. As concepts and regulations begin to be implemented, politicians pushing those policies are facing growing opposition.

European Companies Looking Abroad

A majority of chief executives in an influential group of European businesses said they are planning to increase their presence in North America amid growing concerns about Europe’s loss of competitiveness. About 57 percent of company chiefs of European multinationals are eyeing shifting investments or operations — or both — over the next two years. A majority of respondents — more than 80 percent —  said they believe Europe is losing competitiveness as a base for industry, as the continent reels from geopolitical risks, inflation and energy costs, along with skills shortages and supply-chain disruptions. Europe’s efforts to restore its competitiveness are more challenged than ever due to an unstable geopolitical environment, elevated energy prices compared to pre-2019 levels, rising inflation, tighter financing conditions, and record-high input costs.

Conclusion

The EU seems to be realizing that its quest to reach net zero carbon needs to take a pause and perhaps be more thought-out as the pace of legislative changes may be a detriment to the economy and to their political futures.  Escalating prices are making more residents energy-poor and forcing companies to move abroad to be competitive, leading to de-industrialization. It seems that when politicians feel the heat, they see the light.

But, Biden is not heeding the European warnings and instead is moving ahead with regulations that will shutter natural gas and coal plants, force Americans to buy electric vehicles costing much more than gasoline-powered vehicles, and practically kill the U.S. coal industry. The Biden administration laws are forcing wind and solar power on communities through lucrative incentives that will result in higher electric costs and summer blackouts as reliability will be lessened with fewer coal and natural gas power plants. It is mind-boggling that the United States under President Biden is now to the left of socialist France and other EU nations in climate fanaticism and is enacting policies that would make people poorer.

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*This article was adapted from content originally published by the Institute for Energy Research.