Factbox: How 'green' is the EU's recovery deal?

BRUSSELS (Reuters) - European Union leaders clinched a deal on Tuesday for a huge stimulus package which the European Commission has said will make fighting climate change central to Europe’s economic recovery from the coronavirus pandemic.

European Council President Charles Michel and European Commission President Ursula Von Der Leyen attend a news conference following a four-day European summit at the European Council in Brussels, Belgium, July 21, 2020. Stephanie Lecocq/Pool via REUTERS

Climate advocates said the final deal - a 1.074 trillion euro EU budget for 2021-27, plus a 750 billion euro recovery fund - was a mixed bag, with large sums earmarked for green investments, but cuts to key climate programmes and insufficient rules to ensure cash does not support polluting investments.

Here are the climate elements of the deal.


The deal earmarks 30% of the entire package for climate protection and says all spending must contribute to EU emissions-cutting goals.

This could see nearly 550 billion euros spent on climate over 2021-27 - a massive sum, but far below the 2.4 trillion euros in investment researchers say is needed to meet EU climate goals.


The EU’s flagship fund for weaning countries of fossil fuels received 17.5 billion euros - less than half of what was previously proposed. The conditions for accessing it were also watered down.

Countries that have not signed up to an EU-wide target to become “climate neutral” by 2050 will only get half of their share of the Just Transition Fund.

Previous proposals would have forced countries to commit to climate neutrality at a national level - but EU officials said this was a “red line” for Poland, the coal-heavy country expected to receive the biggest chunk of the money.

Money was also shaved off InvestEU and Horizon Europe, two programmes earmarked for sustainable investments, as EU leaders conceded cuts to appease frugal northern countries.


New green taxes will help fill EU coffers, with an EU-wide tax on non-recycled plastic waste scheduled for next year.

A plan to slap levies on polluting imports should be ready by 2023, and a scheme to use carbon market revenues to shore up EU funds will be considered later.


The EU deal does not say what rules it will apply to ensure funding goes to climate-friendly schemes and some members of the European Parliament - which must approve the package - refused to commit their support without tougher conditions to block polluting investments.

“There are too many things that still need improvements,” said Dutch Green lawmaker Bas Eickhout. “The deal is not over yet.”

Reporting by Kate Abnett; Editing by Nick Macfie