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EU Strikes 2040 Climate Deal With 90% Cut and Limited Foreign Credits

The political compromise faces only procedural approval as Brussels builds in reviews, consumer safeguards, and potential adjustments tied to natural sinks.

Overview

  • Negotiators for EU member states and the European Parliament agreed to reduce greenhouse-gas emissions by 90% from 1990 levels by 2040.
  • Up to five percentage points of the target can be achieved through carbon credits from non‑EU countries starting in 2036, with detailed safeguards still to be defined.
  • The inclusion of heating and road fuels in the EU emissions trading system was delayed by one year to 2028 to avoid sharp consumer price increases.
  • The European Commission will conduct biennial progress reviews and can propose new legislation, and the target may be lowered if carbon sinks deliver less than expected.
  • The agreement weakens the European Commission’s July proposal after economic pushback from several governments and still awaits formal ratification viewed as a formality.