Achieving Climate Neutrality: EU's Decarbonization Pathway by 2040
The European Commission has put forth a bold proposal in July 2025 to amend the European Climate Law, aiming to set an ambitious EU climate target for 2040. This new target seeks to reduce net GHG emissions by 90% compared to 1990 levels, reinforcing the EU's commitment to climate change mitigation.
Setting a 2040 target crystallizes the EU's ambition to tackle climate change, laying the groundwork for achieving climate neutrality by 2050. This goal is pivotal to the European Green Deal, serving as a legally binding objective embedded within the Climate Law. It echoes the strides made with the 2030 climate target, which aims for at least a 55% net emission reduction by the same baseline year.
Adopting a pragmatic pathway, the proposal integrates current economic, security, and geopolitical contexts, in line with the EU Competitiveness Compass and the Clean Industrial Deal. The focus is on providing predictable and stable grounds for investments critical to the EU's clean energy transition, fostering industrial resilience and long-term competitiveness.
Reducing emissions drastically to meet the 2040 goal is expected to catalyze a healthier and safer future for citizens. Importantly, it offers predictability for businesses and investors, aligning resource deployments with the EU's climate neutrality trajectory, thus eschewing stranded investments in obsolete fossil technologies.
Key flexibilities are proposed to ensure this transition is both socially fair and economically feasible. The potential inclusion of international carbon credits towards the end of 2030-2040 stands out, alongside the use of domestic removals under the EU ETS framework. Emphasizing cross-sector flexibilities, these measures seek a cost-effective achievement of the 2040 climate target.
The Commission's proposal emerges from extensive consultations, engaging EU nations, the European Parliament, stakeholders, and the public. Beginning with the Commission Communication in early 2024, a public consultation gathered diverse viewpoints to inform the 2040 climate target, supported by the expert input from the European Scientific Advisory Board on Climate Change.
This initiative not only strengthens Europe's climate action leadership but also positions the EU as a pivotal player in the burgeoning market for clean technologies. The 2040 target, thus, envisions a resilient and strategically autonomous European Union, steering global efforts in sustainable development.