Politics Should Not Be Governed by the Dirty and Slow

The European Union's climate policy is facing criticism for potentially favoring slower, more polluting industries over those committed to rapid green transitions. The EU Commission's recent proposal on emissions trading, presented on July 17, suggests a slower rate of emissions reduction and delays the phase-out of free emission allowances for the steel industry until 2038.

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The losers are the companies that want to transition quickly. Those who have made their business plans based on the fact that it will become more difficult and more expensive to emit – and that it will therefore be a competitive advantage to be at the forefront.

This shift is seen as a setback, particularly for companies like Swedish steel giants that have based their business plans on increasing costs for emissions and view being at the forefront of green technology as a competitive advantage. Conversely, the proposal benefits fossil-fuel-heavy companies on the continent, which are described as "slow and dirty" and have had ample time to prepare for a post-carbon future but are lagging behind.

The editorial argues that aligning climate policy with the least efficient companies undermines investment incentives. Companies may hesitate to invest billions in transforming their production to become carbon-neutral if policy conditions can suddenly change, rendering their investments unprofitable. This situation not only threatens the competitiveness of Swedish and other European businesses but also poses risks to Europe's energy security.

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The slow and dirty. Those who have had many years to prepare for a future where they will no longer be allowed to destroy the climate, but are still about to miss the green train.

In an increasingly hostile global landscape, dependence on authoritarian states for energy is a significant concern. The energy crisis following Russia's invasion of Ukraine highlighted the vulnerability of European countries to fluctuating energy prices and the geopolitical leverage held by fossil fuel-exporting nations. The article contends that reducing reliance on fossil fuels is crucial for both economic stability and security, citing higher electricity price increases in countries with a greater share of gas in their energy mix.

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How should companies dare to invest many billions to convert their entire production and become carbon neutral in 10–15 years, when the conditions can suddenly change so that the investment risks becoming unprofitable?

Therefore, the editorial strongly urges that the EU Commission's proposal should not be implemented, warning against a naive approach to climate policy that could jeopardize long-term environmental goals and energy independence.

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Being dependent on authoritarian states in an increasingly hostile world is not a good idea.