Johan Van Overtveldt: “The European Fit For 55 plan will result in a hefty bill for Flemish families and businesses”

This week, the European Parliament voted on the European package of measures to further reduce CO2 emissions known as the Fit For 55 plan. The N-VA group is critical and concerned and will therefore abstain from certain parts. “Like everyone else, we are convinced of the need for a sustainable energy transition, but it must also provide security, safeguard jobs and be affordable. This package threatens to affect both the competitive position of our Flemish companies and the purchasing power of Flemish families,” says MEP Johan Van Overtveldt.

The emissions trading system is the cornerstone of European climate policy and aimed to reduce CO2 emissions by 55% by 2030. To be allowed to produce emissions, companies must purchase emission allowances through auctioning. Initially, these allowances were partly free, mainly for (heavy) industry and for investments in modernising the energy sector. The N-VA delegation considers it logical that the system is being extended to the aviation and shipping sectors, as a level playing field across the sectors is needed.  However, it does question the level of ambition.

Effort increased yet again

Johan Van Overtveldt: “The agreement raised the ambition to a 62% reduction in emissions. This means that the annual effort increases considerably.  We don’t think this is realistic. Moreover, it will have a negative effect on public support.”

Energy prices will rise

“But even more problematic are the new ETS levies that will apply to cars and buildings.” Emissions for those must also be reduced by 62%. In other words, prices at the pump and consumer energy bills will rise. We think this is unacceptable, especially when there is already much uncertainty about energy supply and prices.  We will vote resolutely against this measure.”

According to Van Overtveldt, sustainable energy consumption among families should be stimulated through support for renovation and insulation, as the Flemish government does, for example, instead of imposing additional taxes through levies.

Flanders is a net contributor to the European Climate Fund

The European Social Climate Fund has EUR 65 billion available for the period 2026-2032, with national co-financing of 25%.  That brings the total to EUR 81.25 billion. It should provide income support to families affected by ETS2. “However, our Flemish families will not be able to benefit from this support.  It will go to other Member States; Flanders will become a net contributor to this system,” adds Van Overtveldt, who also states that social policy is a competence of the Member States, not of the EU.

Carbon correction at the border

A major risk of the emission levies is carbon leakage.

Companies unwilling or unable to pay for these allowances occasionally take the step of moving to countries outside the EU. To counter this, certain sectors were able to obtain free emission allowances. Due to the Carbon Border Adjustment Mechanism (CBAM), those free allowances will be phased out from 2028 to 2034. 

Flemish companies disadvantaged

“We are in favour of the principle, but the problem remains that this mechanism does not take sufficient account of companies and regions that are very export-oriented, such as Flanders. Flemish companies will thus have to compete globally with companies, for example Chinese companies, which do not have to pay carbon taxes. It is incomprehensible that the Commission did not conduct a thorough, prior impact assessment on the impact on jobs and Competitiveness The extent to which companies in one country can compete with similar companies in another country. A law came into force in Belgium in 1996 to monitor competitiveness. This stipulates that Belgian salaries may not evolve faster than the average of those in the three neighbouring countries. The Central Economic Council (CEC) performs an annual measurement to see if the objectives have been obtained. competitiveness ,” says Geert Bourgeois, head of the European N-VA group delegation and coordinator of the Committee on International Trade.