Policy & Regulation

11 Oct 2022

Austria Seeks Allies for Legal Challenge to EU Green Investment Rules

11 Oct 2022  by   

Power-generating windmill turbines are seen at a wind park near Andau, Austria May 2, 2019. REUTERS/Leonhard Foeger

Austria said on Monday it was seeking to enlist other European Union countries to support its legal action against Brussels for labelling investment in gas and nuclear power as "green".

Vienna on Friday filed a legal challenge against the EU's inclusion of the energy sources on a list of climate-friendly investments, which exposed deep rifts between countries over which energy sources to use to meet climate change goals.

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Luxembourg confirmed on Monday it would join Austria's action. Austrian Environment Minister Leonore Gewessler said others may follow, without naming the countries.

"I find it irresponsible and unreasonable," Gewessler said of the EU's decision.

An EU official said Austria was undertaking "diplomatic outreach" to potentially interested countries.

Austria, Germany, Luxembourg, Portugal and Denmark jointly called for nuclear to be excluded from the rules last November when the EU was still drafting them. Ireland and Spain had also warned Brussels against labelling investments in gas as "green".

A German environment ministry spokesperson said the country would not join the legal action, but added that "it is good that the objections to the taxonomy regulation will now be reviewed by the courts."

The EU's so-called taxonomy is a rulebook defining which investments can be labelled climate friendly, designed to guide investors towards green projects that will help achieve the bloc's emissions-cutting targets.

A European Commission spokesperson said it had taken note of the action but would not comment on the substance of the case.

"The EU's taxonomy is to a very large extent focused on renewable energies. Renewables will continue to be the focus for green investors and the creation of green financial products," the spokesperson said, adding that gas and nuclear investments must meet "strict conditions" to be included.

Austria's legal action, submitted to the EU's general court, makes 16 arguments for why Brussels should annul the rules - including that nuclear energy cannot meet a requirement to "do no significant harm" to the environment because of concerns about radioactive waste.

Austrians widely oppose nuclear power and the country has never had an atomic plant.

Gewessler said it was "misleading" to label gas, a fossil fuel, as a green energy investment.

The European Commission proposed the law in February, after more than a year of intense lobbying. Some central and eastern EU countries had argued gas investments should be inventivised to help them quit more carbon-intensive coal, while states including France see low-carbon nuclear energy as key to cutting greenhouse gas emissions.

Environmental campaigners including Greenpeace launched separate legal challenges last month against the rules, which they said violated the EU's own climate laws.


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