The latest draft of EU sustainable financing measures will delay the energy transition and push costs up, according to BayWa chief executive Klaus Josef Lutz.
Lutz said the EU taxonomy only covers parts of value creation and that companies whose contribution to sustainability is not currently assessed as significant run the risk of being assessed as less sustainable than they actually are.
As a result, they may no longer be able to use green financing instruments in the future, he said.
“The current discussion massively overlooks the fact that companies that have been making a clear contribution to a climate-neutral energy supply for decades will soon be worse off than less sustainable business models as a result of the EU taxonomy,” said Lutz.
“While nuclear and natural gas power plants, which are obviously not sustainable, are to be given a green cloak, the trade in solar modules and green electricity are not included in the taxonomy criteria.
“They are thus not considered significant for sustainability and climate protection. This is absurd, considering the goal of the EU taxonomy: To reward companies that align their investments with sustainability and to strengthen their competitiveness.”
The BayWa CEO also believes that this will make it more difficult for the German government to achieve its goal of doubling the share of renewable energies in the electricity supply to 80 percent by 2030.
The Platform on Sustainable Finance, an official advisory group to the European Commission supporting the development of the EU list of sustainable activities, said that labelling gas and nuclear as sustainable is not consistent with EU Taxonomy Regulation.
Environmental Coalition on Standards senior programme manager Mathilde Crepy said: “The Commission’s proposal considers fossil gas and nuclear to be green energy sources.
“The decision to consider fossil gas and nuclear to be sustainable energy sources is a disaster for the environment and for science, and legally a breach of the Taxonomy Regulation.
“We urge the Commission to stop bowing to the gas and nuclear lobbies, and to end the institutional greenwashing of environmentally harmful energy activities.”
The coalition is a member of the Platform on Sustainable Finance.