EU climate policy

The climate policy of the European Union guides the policy measures to mitigate climate change and adapt to it, both within the EU as a whole and in individual Member States. The EU climate policy is based on the United Nations Framework Convention on Climate Change, the Kyoto Protocol to the Convention, and Paris Agreement on Climate Change.

EU aims for climate neutrality by 2050

The EU is committed to reducing its net greenhouse gas emissions by at least 55 per cent by 2030, compared to 1990. This is also the commitment the EU has declared to the Secretariat of the UN Framework Convention on Climate Change for the purposes of the Paris Agreement. In addition, the EU as a whole aims to achieve climate neutrality, i.e. a balance of emissions and removals regulated by the EU legislation, by 2050. The climate targets to 2030 and 2050 are included in the Regulation on the European Climate Law adopted in 2021. In future, the Regulation will be amended to also include an EU climate target for 2040.

Targets divided among the emissions trading, effort sharing and land use sectors

The core elements of EU climate policy are the emissions trading system (EU ETS), national targets for sectors excluded from EU ETS (effort sharing) and obligations concerning the land use sector (LULUCF).

The Emissions Trading Directive and Effort Sharing Regulation guide emission reductions in the EU towards the EU climate targets and, at the same time, Finland towards the national carbon neutrality target for 2035. The aim of the LULUCF Regulation to strengthen carbon sinks also supports Finland’s efforts to strengthen the sinks as part of the national carbon neutrality target.

General emissions trading aims to reduce emissions by 62 per cent by 2030

The aim of the general emissions trading system (EU ETS) is to reduce emissions at the EU level by 62 per cent from the level in 2005 by 2030. EU ETS covers large industrial, electricity and power plants, aviation within the European Economic Area (EEA) and, as from 2024, maritime transport emissions from large passenger or cargo vessels.

New emissions trading system for fuel distribution to be started

In 2027 or 2028 a new separate emissions trading system (ETS II) will be introduced for the distribution of fuels. This will cover carbon dioxide emissions from road transport, building-specific heating, most off-road mobile machinery, and energy production and industrial plants excluded from the general emissions trading.

Social Climate Fund supports the most vulnerable people

The emissions trading system for fuel distribution includes a new Social Climate Fund, where the key aim is to promote a socially just transition to climate neutrality. The particular aim of the Fund is to support those in the most vulnerable position with measures and investments concerning increased energy efficiency of buildings, decarbonisation of heating and cooling of buildings, and improved access to zero- and low-emission mobility and transport.

Finland to halve emissions from the effort sharing sector by 2030

The effort sharing sector comprises building-specific heating, off-road mobile machinery, agriculture, transport and waste management and F-gases, which together account for a little more than a half of the EU’s greenhouse gas emissions. Finland should reduce emissions from the effort sharing sector by 50 per cent from the level in 2005 by 2030.

Certain flexibilities are allowed for Member States to meet the obligation for the effort sharing sector, such as transfer of a small number of emission allowances from emissions trading to the effort sharing sector. It is also possible to save some of the surplus of the annual emission allocations to the coming years or purchase emission reduction units from other Member States.

Net sink of the land use sector to be maintained

The LULUFC Regulation applies to emissions from land use, land use change and forestry. The aim set for the period 2021–2025 is that this sector causes no net emissions, i.e. that the emissions are equal to the removals. For the period 2026–2030 the carbon sinks should be strengthened so that the removals reach the level of -310 million tonnes of carbon dioxide equivalent in 2030. Finland’s share of this target is about EUR -17.8 million tonnes.