EU Updates Climate Law with Ambitious 2040 Target
On 2 July 2025, the European Commission unveiled a bold proposal to amend the EU Climate Law, setting a legally binding goal to slash net greenhouse gas (GHG) emissions by 90% by 2040 compared to 1990 levels. This initiative strengthens the EU’s roadmap to climate neutrality by 2050.
Long-Term Vision and Goals
Building on the existing 2030 target of at least 55% emissions reduction, the 2040 target aims to provide clear policy direction and encourage investments in green technologies across Europe.
Flexible Compliance Options
To support a smooth transition, the proposal includes:
•International Carbon Credits: Up to 3% of the reduction target may be met through projects outside the EU, starting in 2036.
•Sectoral Adaptations: Special mechanisms to help industries reduce emissions without losing competitiveness.
Integration with EU Climate Strategies
The new target complements key EU frameworks:
• Clean Industrial Deal
• Affordable Energy Action Plan
• EU Competitiveness Compass
These policies balance economic growth, energy affordability, and environmental goals.
Scientific Foundation
The European Scientific Advisory Board on Climate Change recommends a 90–95% reduction by 2040 to align with the 2050 climate neutrality goal, underpinning this legislative update.
Next Steps
• Formal review and approval by the European Parliament and Council
• Inclusion of the 2040 target in the EU’s next Nationally Determined Contribution (NDC) for COP30 in Brazil
• Foundation for post-2030 EU climate and energy policies
Summary
|
What This Means for Businesses?
The 2040 target signals a clear push for industries to accelerate sustainability plans, adopt cleaner technologies, and prepare for evolving regulations. The proposal enhances certainty for long-term investment and innovation in Europe’s green economy.
Reference: European Commission News
Reach out to our regulation experts on chemical and product regulatory compliances