The recent report by the Intergovernmental Panel on Climate Change (IPCC) warned us that the current actions and policies against climate change are not sufficient in restricting the rise in temperatures to 1.5°C. Unless we act urgently, the current emission pathway will lead to a rise of 3°C by the end of the century. We at Castrén & Snellman have been a part of several initiatives to combat climate change, and we wish to continue our pioneering work of promoting climate actions.
The sanctions against Russia have demonstrated how highly dependent the European continent is on Rus-sian-supplied fossil fuels. We are sorely in need of increased independent, European energy production. In March, the European Commission urged once again that the Union and its Member States should expedite the changes. Even though some states find it difficult to commit to such change, in the long run our only option is energy production that is renewable and carbon neutral.
Intersecting these two energy-related crises is the Green Deal growth strategy, which aims to make the EU climate neutral by 2050. The strategy is accompanied by a comprehensive regulatory package covering everything from the climate and the environment to energy, traffic, industry, farming, sustainable financing, and reporting.
Achieving these goals, especially when it comes to the switch from fossil fuels to renewables, places major investment needs on companies. It will also require new skills, collaboration across different sectors, and partners who are committed to meeting the same targets. Some companies will achieve competitive edge through pioneering action, while others will focus their efforts on collaborating with others. Reforms in competition law will play a central part in this. What's more, permit and tax regulations for energy initiatives are constantly evolving, and future regulation is neither consistent nor coordinated in all respects. Despite all this, companies must follow the laws.
In addition to evolving laws and emerging challenges, the change involves a lot of money; it is estimated that achieving the climate goals will require investments of over EUR 1,000 billion every year for the next decade. The EU will finance new innovations generously in the coming years, and investors and financiers expect companies to switch to renewable energy and to commit to sustainability. Now is the time for change – let's choose our partners and take action.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.