BRUSSELS (Reuters) - A battle over whether oil, coal and nuclear fuel can classify as “green” is expected to begin on Wednesday when EU states and lawmakers begin talks on sustainable investment rules.
Brussels proposed the law as part of a plan to make Europe the world’s first climate neutral continent by 2050 but also to widen the market in green bonds and securities.
Any delay on introducing eco-labels on financial investments could deter investors from eco-friendly assets.
The negotiations, due to finish in December, will pit the more conservative European Union countries against a European Parliament, where Green parties have a louder voice.
The European Commission first proposed legislation in May 2018 to tackle “greenwashing”, where banks and other companies claim undeserved environmental credentials for investments.
The European Council, which is made up of the bloc’s 28 member states, generally supports the Commission’s proposals.
But EU lawmakers want to go further by making clear distinctions between what is sustainable and what is not. The parliament has singled out financing of solid fossil fuels such as coal, saying these cannot be called “sustainable”.
The Council and Commission want a more wide-ranging law, that would not have a specific list of green investments, leaving the door open for nuclear energy, for example, to be considered sustainable.
“For the time being, our objective is to exchange best practice between the members and observers to the platform,” a Commission spokesperson told Reuters.
“For those members who are willing, we will progressively move toward developing common approaches.”
Both the Council and parliament hope the regulations and a general law can be established by the end of 2021 and come into force by the end of 2022.
But without a specific list of what is a green investment and what is not, lawmakers say the process could delay the law’s implementation.
The market for green bonds is mostly denominated in euros, unlike many other assets which are priced in dollars, something which some bankers say offers an opportunity for the currency.
Last week, the EU launched new rules and standards for trillions of dollars of private and public “green” investment, together with China, India and other countries.
Reporting by Jonas Ekblom; editing by Philip Blenkinsop, Jane Merriman and Alexander Smith