From Washington to Warsaw, a ‘greenlash’ is picking up steam despite extreme heat
Demonstrators hold placards and chant slogans during a rally to protest against the expansion of the Ultra Low Emission Zone (ULEZ) in London, at Marble Arch, central London, on June 25, 2023.
Henry Nicholls | Afp | Getty Images
In the wake of a U.S. crusade against mission-driven investments, signs of a green political backlash in Europe appear to be gathering pace.
State laws restricting the use of environmental, social and governance factors have swept across the U.S. in recent months, fomenting uncertainty for an increasing range of businesses.
In Florida, Republican Gov. Ron DeSantis signed a bill into law in early May that barred state and local officials from investing public money to promote ESG goals and prohibited municipalities from selling ESG bonds. “We do not want them engaged on these ideological joyrides,” DeSantis reportedly said at the time.
Analysts expect the outcome of next year’s U.S. presidential election to determine whether the political backlash against ESG will have a deep and lasting effect.
A pushback against climate policies is not just a U.S. issue. In Europe, indications of a green backlash — or “greenlash” — have started surfacing as businesses and citizens feel the costs of the energy transition.
Speaker of the House Kevin McCarthy (R-CA) signs a resolution passed by the House and Senate that aims to block a Biden administration rule encouraging retirement managers to consider environmental, social and corporate governance (ESG) factors when making investment decisions, during a bill signing at the U.S. Capitol March 9, 2023 in Washington, DC.
Drew Angerer | Getty Images
Nathalie Tocci, director of Istituto Affari Internazionali, an Italian international relations think tank, told CNBC that the weaponization of climate issues from traditionally skeptical political parties was nothing new.
“This is really a story of the last couple of years, but I think it is really picking up steam now,” Tocci said.
Reprisals over climate policies come at a time of record-breaking extreme heat across the globe, with July poised to be the hottest month in human history.
It prompted U.N. chief António Guterres to signal, “The era of global warming has ended; the era of global boiling has arrived.”
‘Reframe the issue’
In the U.K., London mayor Sadiq Khan’s push to expand a contentious Ultra Low Emission Zone policy across the entire city has sparked an economy vs. climate fight — as well as a green identity crisis among Britain’s major political parties.
Dutch farmers have been staging protests over stringent limits on nitrogen emissions, with the BBB or BoerBurgerBeweging (Farmer-Citizen Movement) party lashing out at what it sees as a policy that symbolizes “everything that is not going right” in the country.
I think that in the case of Europe, if you have this ‘greenlash’ that persists … the trick is going to be that of reframing this in terms of industrial policy.
Nathalie Tocci
Director of Istituto Affari Internazionali
In Poland, the conservative government recently filed four complaints against EU climate policies, calling them “authoritarian” and a potential threat to its energy security. Ruling party leader Jarosław Kaczyński described the bloc’s green policies as “madness” and akin to “green communism.”
French President Emmanuel Macron and Belgian Prime Minister Alexander De Croo have also called for a “regulatory pause” of Europe’s green legislation, saying that a period of “stability” is necessary to avoid losing momentum in the climate fight.
France’s President Emmanuel Macron, Belgium’s Prime Minister Alexander De Croo, President of the European Commission Ursula von der Leyen gesture as they attend the North Sea summit in Ostend, on April 24, 2023.
Kenzo Tribouillard | Afp | Getty Images
Anti-green parties could look to latch onto a burgeoning European greenlash in a bid to surge in the polls, with the Netherlands, Poland, the U.K. and European Parliament all due to hold elections over the next 18 months.
“At the moment, it looks like green parties are not doing going fantastically well. I think the challenge is going to be for those, like myself, who really believe in this agenda to reframe the issue,” Tocci said, citing U.S. President Joe Biden’s landmark Inflation Reduction Act as one example.
The IRA, which was signed into law last year, will funnel billions of dollars into programs designed to accelerate the country’s transition away from fossil fuels and battle the climate emergency.
“The IRA is called an IRA, it is not called a climate act because there’s no way that you could get Democrats and Republicans to agree on something called climate,” Tocci said.
“In the case of Europe, if you have this ‘greenlash’ that persists … the trick is going to be that of reframing this in terms of industrial policy.”
Dutch nitrogen crisis
In the case of the Netherlands, the BBB is seeking to capitalize on Prime Minister Mark Rutte’s resignation by becoming one of country’s largest parties in the 150-seat parliament.
The pro-farmer’s party stunned Dutch politics in mid-March by winning provincial elections, shortly after more than 10,000 Dutch farmers rallied against government plans in The Hague.
The backlash follows a landmark court ruling in 2019, which said the Netherlands must reduce excess nitrogen levels. Some of the remedial measures include voluntary buy-out schemes and developing more sustainable farming methods.
Farmers gather at Zuider Park to protest against the government’s farming policy on reduction of nitrogen emissions in The Hague, Netherlands on March 11, 2023.
Anadolu Agency | Anadolu Agency | Getty Images
Dutch farmers are up in arms over government plans, which they say will bring an end to many farms nationwide and hit food production.
The nitrogen crisis is “an example of what will happen with climate, because climate regulations and targets … will have much more consequences for the farmers than nitrogen,” Jan Willem Erisman, professor of environmental sustainability at Leiden University in the Netherlands, told CNBC by telephone.
“So, I think that solving the nitrogen problem is not enough, it is solving the climate problem — and nitrogen will be solved also,” he added.
Poland’s role as a ‘veto player’
Polish voters are expected to head to the ballot box in the fall. Polish Prime Minister Mateusz Morawiecki has criticized the EU’s “Fit for 55” climate law, saying Warsaw never supported the package and “one size does not fit all.”
Michal Hetmanski, head of Instrat, a Warsaw-based independent think tank, told CNBC that Poland’s government appeared to be determined to remain “a veto player” within the bloc on climate policies.
A spokesperson for Poland’s ruling Law and Justice party did not reply to a CNBC request for comment.
At the European parliamentary level, meanwhile, lawmakers are not expected to scale back on climate action ahead of elections next spring.
An overwhelming majority of European citizens recognize the climate emergency is a serious problem, and most agree that adapting to the adverse impacts of the crisis can have a positive outcome.
“It’s worth remembering that the EU has already committed to cut CO2 emissions by 55% by 2030 and achieve climate neutrality by 2050,” Arthur Carabia, director of ESG policy research at Morningstar Sustainalytics, told CNBC via email.
The EU’s “Fit for 55” law is designed to help the 27-nation bloc achieve its target of reducing net greenhouse gas emissions by at least 55% by 2030 and reach climate neutrality by 2050.
“While there is still a long way until May 2024, we don’t expect that the results of the upcoming EU elections will cause to the EU to deviate from this objective,” Carabia said.
In a joint statement, French and German economists have called on governments to adopt “a common approach” to decarbonize European trucking fleets – and they’re calling for a focus on fully electric trucks, not hydrogen.
France and Germany are the two largest economies in the EU, and they share similar challenges when it comes to freight decarbonization. The two countries also share a border, and the traffic between the two nations generates major cross-border flows that create common externalities between the two countries.
At the same time, the EU’s transport sector has struggled to reduce emissions at the same rate as other industries – and road freight in particular is a major contributor to harmful carbon emissions issue due to that industry’s heavy reliance on diesel-powered trucks.
And for once, it seems like rail isn’t a viable option:
While rail remains competitive mainly for heavy, homogeneous goods over long distances. Most freight in Europe is indeed transported over distances of less than 200 km and involves consignment weights of up to 30 tonnes (GCEE, 2024) In most such cases, transportation by rail instead of truck is not possible or not competitive. Moreover, taking into account the goods currently transported in intermodal transport units over distances of more than 300 km, the modal shift potential from road to rail would be only 6% in Germany and less than 2% in France.
That leaves trucks – and, while numerous government incentives currently exist to promote the parallel development of both hydrogen and battery electric vehicle infrastructures, the study is clear in picking a winner.
“Policies should focus on battery-electric trucks (BET) as these represent the most mature and market-ready technology for road freight transport,” reads the the FGCEE statement. “Hence, to ramp-up usage of BET public funding should be used to accelerate the roll-out of fast-charging networks along major corridors and in private depots.”
The appeal was signed by the co-chair of the advisory body on the German side is the chairwoman of the German Council of Economic Experts, Monika Schnitzer. Camille Landais co-chairs the French side. On the German side, the appeal was signed by four of the five experts; Nuremberg-based energy economist Veronika Grimm (who also sits on the National Hydrogen Council, which is committed to promoting H2 trucks and filling stations) did not sign.
You can read an English version of the CAE FGCEE joint statement here.
Electrek’s Take
MAN Trucks’ CEO famously said that it was “impossible” for hydrogen to compete with BEVs, and even committed to building 200 hydrogen-powered semi truck to prove out that hypothesis.
He’s not alone. MAN’s board member for research and development, Frederik Zohm, said that the company is the one saying hydrogen still has years to go. “(MAN) continues to research fuel cell technology based on battery electrics,” he said, in a statement quoted by Hydrogen Insight, before another board member added that, “we (MAN) expect that, in the future, we will be able to best serve the vast majority of our customers’ transport applications with battery-electric trucks.”
With companies like Volvo and Renault and now Mercedes racking up millions of miles on their respective battery electric semi truck fleets, it’s no longer even close. EV is the way.
SOURCE | IMAGES: CAE FGCEE; via Electrive.
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GE Vernova has produced over half the turbines needed for SunZia Wind, which will be the largest wind farm in the Western Hemisphere when it comes online in 2026.
GE Vernova has manufactured enough turbines at its Pensacola, Florida, factory to supply over 1.2 gigawatts (GW) of the turbines needed for the $5 billion, 2.4 GW SunZia Wind, a project milestone. The wind farm will be sited in Lincoln, Torrance, and San Miguel counties in New Mexico.
At a ribbon-cutting event for Pensacola’s new customer experience center, GE Vernova CEO Scott Strazik noted that since 2023, the company has invested around $70 million in the Pensacola factory.
The Pensacola investments are part of the announcement GE Vernova made in January that it will invest nearly $600 million in its US factories and facilities over the next two years to help meet the surging electricity demands globally. GE Vernova says it’s expecting its investments to create more than 1,500 new US jobs.
Vic Abate, CEO of GE Vernova Wind, said, “Our dedicated employees in Pensacola are working to address increasing energy demands for the US. The workhorse turbines manufactured at this world-class factory are engineered for reliability and scalability, ensuring our customers can meet growing energy demand.”
SunZia Wind and Transmission will create US history’s largest clean energy infrastructure project.
Read more: The largest clean energy project in US history closes $11B, starts full construction
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