What is EU taxonomy?
The EU taxonomy is a classification system, establishing a list of environmentally sustainable economic activities.
It should play an important role in helping the EU scale up sustainable investment and implement the European green deal. The EU taxonomy would provide companies, investors and policymakers with appropriate definitions for which economic activities can be considered environmentally sustainable. In this way, it intends to create security for investors, protect private investors from greenwashing, help companies to become more climate-friendly, mitigate market fragmentation and help shift investments where they are most needed.
The Taxonomy Regulation published on 22 June 2020 establishes the basis for the EU taxonomy by setting out 4 overarching conditions that an economic activity has to meet in order to qualify as environmentally sustainable and establishes six environmental objectives:
- Climate change mitigation
- Climate change adaptation
- The sustainable use and protection of water and marine resources
- The transition to a circular economy
- Pollution prevention and control
- The protection and restoration of biodiversity and ecosystems
Different means can be required for an activity to make a substantial contribution to each objective. The EU taxonomy will have implications for all sectors of the economy including aviation as the future framework is set to be critical for informing investors on which aircraft investments can, or cannot be, counted as green aviation.
What’s the state of play?
The Platform on Sustainable Finance, an independent expert group assisting the Commission in developing its sustainable finance policies, notably the further development of the EU taxonomy, is working on a series of reports to be issued in the first semester of 2022. The reports will be further ‘processed’ by the European Commission to translate their contents into EU legislation (delegated acts). In February, EBAA had a meeting with the Aviation Policy Unit of the European Commission to address the file, even if at this stage no specific information on the content of the reports could be provided to EBAA or our partner associations following them. EBAA will remain in close contact with the European Commission should the technical screening criteria applying to our activities be inadequate or discriminatory as compared to the airline sector and other key players.