February 22, 2022

The EU's so-called Green Deal is intended to drive forward the greening of the financial system. Of central importance here are uniform regulations that clearly define which investments may be designated as sustainable and under what conditions. The EU taxonomy should ensure that investors can be confident that they are actually investing in sustainable financial products if they are labeled as sustainable. Likewise, financial institutions should be able to be sure that they will not be accused of greenwashing. However, the positive effect that EU taxonomy should have on financial systems is being jeopardized by the current political debate. What has happened?

After the German government finally rejected the EU Commission's proposal last January and spoke out against the inclusion of nuclear power, the EU Commission has nevertheless come out in favor: Nuclear power as well as natural gas have now been classified as "sustainable bridging technologies." Nuclear power and gas are thus included in the taxonomy for sustainable financial products, which has met with massive reservations and resistance from many. Opponents speak of "greenwashing". In addition to Germany, Luxembourg and Austria had also campaigned against the eco-label for nuclear power. However, this did not bring about major changes. Since the taxonomy is a "delegated act" and not a normal EU law, the EU Commission is in a position to "rule through".

The EU Commission defends its plans in the course of the Green Deal. EU Commissioner Mairead McGuiness is confident that the regulation will increase transparency and promote private investment. She also stressed that national energy policies would remain unaffected by the taxonomy and that EU member states would be free to opt for or against a particular technology. She rejected the accusations of greenwashing, saying that the use of nuclear and gas is subject to strict conditions, so there can be no talk of greenwashing.

But the criticism continues. The Commission continues to meet with resistance in the European Parliament. The Greens in the Parliament speak of "labeling fraud", which would be at the expense of the energy transition and investors. The SDP also speaks out against the taxonomy. However, preventing the taxonomy does not seem to be feasible. To stop a "delegated act", a simple majority is not enough. At least 20 EU states must vote against it, which is considered unattainable.

Protests also increased against the classification of nuclear energy and gas as climate-friendly. At a press conference in Vienna, Austrian Climate Protection Minister Leonore Gewessler explained that her ministry would "prepare all legal steps" in the coming weeks and, if the taxonomy enters into force, would "take action against it with an action for annulment" at the European Court of Justice. The lawsuit could delay the implementation of the taxonomy - but the EU Commission considers its draft to be legally sound. The taxonomy, including the seal of approval for nuclear and gas, is to come into force in 2023 at the latest.

Dispute over EU taxonomy: European acid test - taz.de

EU taxonomy: Brussels ennobles gas and nuclear power - taz.de