The consultation seeks feedback on its “measures-based approach” to classifying industrial activities, as well as “Do No Significant Harm” criteria.

By Paul A. Davies, Farhana Sharmeen, Michael D. Green, and James Bee

The Green Finance Industry Taskforce (GFIT) was convened by the Monetary Authority of Singapore (MAS) and includes representatives from financial institutions, corporates, and financial industry associations, among other stakeholders. The industry-led group aims to accelerate the development of green finance in Singapore through four initiatives:

  1. Developing a taxonomy
  2. Enhancing environmental risk management practices of financial institutions
  3. Improving disclosures
  4. Fostering green finance solutions

The Plan aims to “simplify, accelerate and align incentives to preserve the competitiveness and attractiveness of the EU as an investment location for the net-zero industry”[1].

By Paul A. DaviesMichael D. Green, and James Bee

On 1 February 2023, the European Commission (Commission) presented a proposal for a Green Deal Industrial Plan for the Net-Zero Age (the Plan). The Plan forms part of the European Green Deal adopted in 2019, which sets out the EU’s green transition ambitions and climate targets towards reaching net zero by 2050. The Plan sits alongside other Green Deal initiatives, including the “Fit for 55” package of policies (which seek to reduce greenhouse gas emissions by 55% from 1990 levels by 2030), as well as REPowerEU (introduced to reduce reliance on imported fossil fuels and provide clean and affordable energy).

The Plan is designed to support the scaling up of the EU’s net zero manufacturing capacities and installation of sustainable products and energy supplies, whilst also enhancing the competitiveness of Europe’s net zero industry. This Plan is particularly relevant in light of the US Inflation Reduction Act in the US, which aims to mobilise over $360 billion by 2032[2], and recent concerns in relation to energy security and energy prices in the EU.

By Paul A. Davies, Michael D. Green, and James Bee

The CBAM would seek to mitigate carbon leakage through the imposition of a levy on carbon-intensive imports into the EU, while free allowances under EU ETS would be phased out.

On 13 December 2022, negotiators from the European Parliament and European Council reached a provisional and conditional agreement on the terms of the EU’s carbon border adjustment mechanism (CBAM).

The CBAM was initially proposed by the European Commission in July 2021 as part of its “Fit for 55” package of policies. The measure seeks to address and mitigate the risk of “carbon leakage” from the EU, which refers to the risk that the EU’s greenhouse gas reduction efforts will be offset by increasing emissions outside of its border through the relocation of production to non-EU countries with less ambitious emissions reduction policies.

The CBAM would impose a levy on in-scope goods that are imported into the EU. Importers of such goods would be required to pay an amount equal to the cost of the emissions allowances under the EU Emissions Trading System (ETS) that would have been necessary to pay to produce that good in the EU.

The annual report shows a considerable uptake in the adoption of climate-centred financial disclosures.

By Paul A. Davies and Michael D. Green

The Task Force on Climate-related Financial Disclosures (TCFD) published its Annual Report on TCFD-aligned disclosures by firms (Annual Report), on 29 October 2020. The TCFD was established by the Financial Stability Board (FSB) in 2015 as a mechanism to develop an approach for companies to disclose climate change matters. The TCFD offers companies guidelines and disclosure recommendations for providing information to investors, so that companies can provide more consistent, comparable data. The TCFD also promotes climate-related scenario analysis and the integration of climate-related risks into risk-management processes.

The government provides further details on UK carbon pricing after Brexit.

By Paul A. Davies and Michael D. Green

On 14 July 2020, the UK government published the draft Greenhouse Gas Emissions Trading Scheme Order 2020 (the Order), establishing a framework for the potential UK Emissions Trading System (UK ETS). Subsequently, on 21 July 2020, the government published a consultation on the operation of a potential new carbon emissions tax.

The Initiative aims to promote sustainability in both the batteries value chain and the growing electric vehicle market.

By Paul A. Davies and Federica Rizzo

On 28 May 2020, the European Commission (EC) published its Inception Impact Assessment (IIA) to modernize the EU’s batteries legislation, in particular Directive 2006/66/EC of 6 September 2006 on batteries and accumulators, and waste batteries and accumulators (the so-called “Batteries Directive”).

The Initiative is in line with the European Green Deal, which promotes the decarbonisation of the EU economy to achieve climate neutrality by 2050. The legislative proposal is also based on the Strategic Action Plan on Batteries adopted by the EC[i] in 2018, which promotes the growth of safe and sustainable battery production, and a better functioning of the internal market as concerns batteries, products incorporating batteries, and recycled materials.

The proposals outline the potential new UK system after Brexit, which could be linked to the EU Emissions Trading System

By Paul Davies and Michael Green

On 1 June 2020, the UK’s Department for Business, Energy and Industrial Strategy (BEIS) published proposals outlining a new UK-wide Emissions Trading System (UK ETS) contained within a response document to a consultation conducted in May 2019. The proposals were jointly designed by the UK, Scottish and Welsh governments, and the Northern Irish Executive (together, the government). The government has stated that the proposals are a “crucial step” towards achieving the UK’s net zero carbon emissions target by 2050.