EU failed to properly assess climate risk of gas projects, watchdog says

BRUSSELS (Reuters) - The European Commission has granted priority status to natural gas projects without properly assessing their impact on climate change, the European Union’s watchdog said in a decision on Thursday.

The EU Ombudsman launched an inquiry in February into the Commission’s process for approving fossil fuel projects as “Projects of Common Interest” (PCI) - a label that means they can receive funding from the bloc and fast-tracked permits.

In the conclusion of its inquiry, the Ombudsman said on Thursday the Commission’s sustainability assessments of gas projects had been “suboptimal”.

“Given the EU’s objectives concerning climate change and sustainability, it is regrettable that gas projects were included on previous PCI lists, without having their sustainability properly assessed,” it said.

None of the 32 gas projects on the latest PCI project list were selected on the basis that they would make a significant contribution to sustainability, the Ombudsman said.

The European Commission could not immediately be reached for comment on Thursday.

Gas produces roughly half the CO2 emissions of coal when burned, but the fuel is associated with emissions of potent planet-warming methane. The EU expects gas use to fall rapidly after 2030, for the bloc to reach net zero emissions by 2050.

The Ombudsman said future assessments of projects seeking PCI status should take into account CO2 and methane emissions.

The Commission is revising its criteria for assessing PCI projects, with a proposal expected next month. In light of this, “no further inquiries are justified at this point,” the Ombudsman said.

The inquiry followed an October 2019 complaint from NGO Food and Water Europe, over a planned liquefied natural gas terminal in Ireland, which would import gas from the United States. The NGO said the project was added to the PCI list without a climate assessment.

“The Ombudswoman clearly confirms the lack of crucial climate assessments of highly subsidized fossil fuel projects for all PCI lists so far,” said campaigner Andy Gheorghiu, who filed the complaint.

Reporting by Kate Abnett; Editing by Steve Orlofsky