The climate finance highlight: European Union Releases the REPowerEU Plan

The climate finance highlight: European Union Releases the REPowerEU Plan

The EU Commission on Wednesday, 18th May 2022, presented the REPowerEU Plan. This is a strategy intended to speedily execute the reduction of EU dependence on Russia’s fossil fuels while pushing the bloc’s green transition.

Before this, on 8th March, the Commission, in a communication proposed the rapid phasing out of Russian fossil fuels and the acceleration of the European Green Deal. Further, on 24 and 25 March the European Council agreed that the bloc will phase out its reliance on Russian gas, oil and coal imports as soon as possible.

These actions find their way into the EUs pursuit of a Green Deal primarily because of Russia’s invasion of Ukraine that has precipitated an energy crisis with heavy repercussions for the rest of the world. The EU has felt the war’s impact much harder than most of the world, especially because the bloc relies on Moscow for approximately 40 percent of its gas and over 25 percent of its oil. As of early March the EU states were divided on the way forward.

While Germany, for instance, was in favor of tougher sanctions on Russia but Hungary opposed this position as it endangers supplies for industry. The divisions are clear. According to the International Energy Agency, Germany gets nearly 25 percent of its oil and 40 percent of its gas from Russia. Slovakia and Hungary on the other hand get 96 percent and 58 percent of oil supply from Russia.

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