Falling behind the pack? Romania’s lack of ambition in non-ETS sectors may undermine the prospects for reaching the European Green Deal objectives

 
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by Mihnea Cătuţi

The European Green Deal represents a development strategy aimed at building an EU economy with net-zero greenhouse gas emissions by mid-century. While Romania’s national targets are generally in line with EU legislation, it is not clear how the proposed policy measures can be translated in precise estimations of emission reductions. Currently proposed measures may anyway need to be changed in light of the future revision of the EU 2030 emission target and related policies.

This policy brief argues that Romania’s lack of ambitiousness, especially in sectors that are not part of the Emissions Trading System, such as transport, buildings and agriculture, may both undermine the country’s ability to reach climate neutrality by 2050 and could put the Romanian economy at a comparative disadvantage compared to early movers. Therefore, the government should significantly and swiftly ramp up its emissions reduction efforts in these sectors.

The new EU multiannual financial framework and the post-coronavirus recovery instrument, Next Generation EU, muster an impressive financial firepower which, alongside the temporary relaxation of state aid rules at EU level, offer a once-in-a-generation opportunity for setting Romania’s economy on a development track that could make it highly competitive in a future decarbonised EU. To ensure this, public spending needs to be grounded in a coherent and rigorous decarbonisation strategy.

Romania’s upcoming long-term strategy could fulfil this role, provided it is developed using science-based modelling tools capable of quantifying the impact that general and sectoral polices may have on reaching the climate objectives. Based on its long-term strategy, Romania will need to develop not only sectoral strategies for transport, buildings and agriculture, but also for the land use and forestry sectors that could become the source of significant carbon sink capacity.

 

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