All environmentally harmful subsidies must stop by 2027 at the latest, says European Parliament

Posted on July, 08 2021

The European Parliament has voted to make it legally binding for all Member States to phase out fossil fuel subsidies by 2025 and all other environmentally harmful subsidies by 2027.
In its position on the 8th Environment Action Programme adopted today, Parliament also calls for the EU to shift towards a sustainable wellbeing economy within planetary boundaries, in which public interests determine economics, and not the other way around. 

“With this vote, Parliament has set out a strong position for the EU to adopt an environmental action programme fit for tackling the ecological and climate crisis, setting a challenge to the Council and Commission to match its ambition,” said Rebecca Humphries, Senior Public Affairs Officer at the WWF European Policy Office. “Legally binding commitments to completely phase out environmentally harmful subsidies in the next five years, and a shift to a new economic model based on wellbeing rather than GDP growth, are essential to making the new action programme worthy of its stated ambition to set Europe on path to living well within planetary boundaries.”

The role of the 8th EAP is to set out the direction for EU environmental and climate policy action until 2030, building on the European Green Deal. Once adopted by the EU institution, the programme will be legally binding on all Member States.

Parliament’s position considerably improves the Commission’s original proposal on the 8th EAP, which lacked the overall ambition and forward-looking actions to achieve the stated long-term aim of ‘living well, within the means of our planet’

In March, the Council already adopted its position, which strengthens the Commission’s proposal, but falls short of firmly embedding the idea of a sustainable wellbeing economy in the 8th EAP.

Parliament also makes explicit the steps that need to be taken to enable this shift, through the establishing of an overarching framework to measure progress towards a sustainable wellbeing economy and progress beyond GDP, and building up the knowledge base on the requirements for systemic change.

Last month, a fossil fuel subsidies phase out by 2025 had already been voted in the Parliament's Biodiversity Strategy resolution. This vote now takes it a step further in a legislative file, and not limited to fossil fuel subsidies only. To support this phase out, the Parliament has asked the Commission to provide guidance by December 2022 on how to identify such environmentally harmful subsidies along with pathways for phase out.

Parliament’s position also addresses key governance gaps and includes significant detail on the enabling conditions and actions needed to make environmental policy in the EU effective through better implementation, and coherence across different policy areas. 

The Parliament’s vision for the 8th EAP also includes, a ‘ think sustainability first’ principle - which would require the Commission to actively seeks positive sustainable impacts from all new policy initiatives; a requirement for all future impact assessments to factor in the cost of inaction and cumulative environmental effects; and annual reports on the EU’s progress on the 8EAP objectives, and the overall goal of achieving systemic change.

Notes to the editor

The amendments referred to above were adopted last night, and the final vote on the whole report is taking place this morning with the results announced at 13:00.

Following this, negotiations between the Parliament and the Council to finalise the 8th EAP in trilogue will begin.


Angelika Pullen
+32 473 947 966

Rebecca Humphries
 +32 493 020 910
The European Parliament has voted to make it legally binding for all Member States to phase out fossil fuel subsidies by 2025 and all other environmentally harmful subsidies by 2027.
© Global Warming Images / WWF