The EU’s green dilemma: Juggling growth and the environment

BRUSSELS — The European Union wants both more green rules and economic growth, but a growing chorus of voices says it can’t have both.

The European Commission’s primary policy effort has been pushing through a Green Deal aimed at addressing the challenges of global warming and environmental degradation. But the energy emergency, the increasing view of China as a competitive threat to the EU, and the U.S. subsidy-heavy Inflation Reduction Act are prompting calls for a rethink.

The latest to do so is French President Emmanuel Macron, who called for the EU to slam the brakes on new environmental rules in a Thursday speech on reviving French industry.

“We have already passed lots of environmental regulations at the European level, more than our neighbors. In regulatory terms we are ahead of the Americans, the Chinese or any other power in the world,” he said. “Now we should be implementing them, not making new changes in the rules or we are going to lose all our players."

Nothing to see here

The Commission rushed to insist that all is well.

"We have a clear green agenda, which is the Green Deal," said a Commission spokesperson, adding that there is a consensus from member countries, including France, "on the direction and priorities for the Green Deal."

French officials also clarified that Macron was not attacking any existing or upcoming EU environmental proposals. “He never talked about a moratorium or repeal of rules that already exist or are under negotiation,” said an Elysée official.

But it’s clear that the political sands are shifting.

Last week, members of the European Parliament from the center-right European People’s Party (EPP) rejected two key Commission environmental efforts — the Sustainable Use of Pesticides Regulation to slash chemical pesticides use, and the Nature Restoration Regulation to restore the bloc’s degraded lands and waters.

Manfred Weber, the leader of the EPP, wrote an op-ed with German Christian Democrat leader Friedrich Merz calling on the EU to put “a stop to new bureaucratic rules in times of crisis.”

The EU’s Net-Zero Industry Act, a bid to boost the bloc’s manufacturing capacity of clean energy technologies, is also running into trouble.

Christian Ehler, the German MEP who leads the Parliament’s work on the file, cautioned that the EU is going to have to think hard about a parallel effort to phase out harmful chemicals called per- and polyfluorinated substances (PFAS) because they’re crucial to green technologies like solar panels and batteries.

"We are imposing a PFAS ban but we have no idea how to substitute roughly 6,000 products and components in the electronic industry," the EPP lawmaker told POLITICO. "That is the perfect example of the conflict of intentions."

While the EPP senses that there are votes to be won in putting up some resistance to new green policies, its left-wing rivals from the Socialists and Democrats (S&D) aren’t breaking with EU orthodoxy.

“That being pro-industry or pro-farmers means that you cannot protect climate, environment and biodiversity at the same time [is] a myth,” said Mohammed Chahim, S&D vice chair.

He stressed that hitting pause on environmental laws until next year’s European election would only result in a “year thrown away” in the fight against climate change.

Interpreting Macron

Macron’s comments were critiqued by the opposition, but they are also causing a political dilemma for some of his allies.

"Any speech that gives the feeling that we have done enough and that it is sufficient is a dangerous speech," said Barbara Pompili, Macron’s former environment minister and currently an MP. “You should never send slow-down messages.”

French MEP Pascal Canfin from Macron’s Renew Europe group told Le Monde that Macron made an “unfortunate” comment and stressed that the president was not calling for freezing environmental proposals currently under discussion.

But Macron hit a nerve with politicians skeptical of the EU’s efforts to add to its roster of environmental regulations.

“For months, we the EPP have been demanding a legislative moratorium to put an end to the excess of standards that hits all those who produce and work in Europe,” Francois-Xavier Bellamy, a French MEP for the EPP, said in a written statement.

As is often the case with Macron’s fuss-inducing comments, interpreters rushed in to insist that the clear reading of his statement may not be quite enough.

“If Macron is suggesting to first focus on implementing the existing EU green rules and those that are being adopted in this mandate, then that’s also what the European Commission is saying," said, Thomas Pellerin-Carlin, director of the Paris-based Institute for Climate Economics, adding that Macron’s use of the term "regulatory pause" was "maybe a bit clumsy, given its meaning in the EU context."

Federica Di Sario reported from Brussels, Giorgio Leali and Alexandre Léchenet reported from Paris.