08/02/2021

Joint written question to the EC on the Sustainable Finance Taxonomy Delegated Act on Climate Adaptation and Mitigation – risk of sustainable investment distortions in the EU aluminium value chain

The Commission is in the process of finalising the Delegated Act on climate mitigation and adaptation under the EU Sustainable Finance Framework.

Although primary aluminium production is eligible, producers are unable to meet the electricity thresholds for indirect emissions as the proposed 100 gCO2/kWh (Annex I) and 270 gCO 2/kWh (Annex II) limits for carbon content of consumed electricity depend strictly on geographical location. In the EU‑27, that would only allow a minimal number of smelters out of the 11 still operating, with an annual capacity of around 2 million tonnes, to meet the criteria.

The climate mitigation ‘do no significant harm’ (DNSH) threshold under the climate adaptation objective (Annex II) would de facto label most EU smelters as significantly harming the environment.

In the light of the above:

How will the Commission ensure that it does not label the majority of EU primary production of aluminium as ‘significantly harming the environment’, in spite of the fact that it has a carbon footprint which is 50 % lower than the global average and three times lower than that of China?

Why does the delegated act – under which mitigation measures aimed at achieving the identified thresholds are no longer eligible – ignore the initial recommendations of the Commission’s Technical Expert Group?

Read the question here and the answer given by Executive Vice-President Timmermans on behalf of the European Commission here.