California and Europe - Common Goals, Common Challenges

I recently had the opportunity to talk about climate policy and politics with eight Members of the European Parliament (MEPs), who were here in the Bay Area to learn more about California’s climate efforts and to talk with some of the local tech companies who are driving innovation on climate and other topics important to the European Union.  It was striking to me just how similar our goals and challenges are in tackling the climate crisis.  We’ve both set ambitious targets and made significant progress, but we’re both also struggling to accelerate emissions reductions to hit those targets, reduce the friction so that we can build clean faster, and make sure that progress is equitable and delivers benefits that can maintain public support.

My meeting with Members of the European Parliament (pictured, from left to right): Martina Dlabajová (Czech Republic), Mikuláš Peksa (Czech Republic), Pernille Weiss (Denmark), Lina Galvez Muñoz (Spain), me, Cristian-Silviu Buşoi (Romania), Christian Ehler (Germany), Josianne Cutajar (Malta), Riho Terras (Estonia)

The EU established ambitious targets for emissions reductions in its European Green Deal.  They include getting to net-zero by 2050 and achieving a 55% reduction in emissions (from 1990 levels) by 2030.  That’s a later net-zero date than California (2045) but a more ambitious 2030 target.  (Our 2030 target is a 40% reduction in statute, though CARB intends to aim for 48% in order to be on track for our net-zero target.)  The EU has also passed a series of legislation aimed at achieving the 2030 target, which is often referred to as the “Fit for 55” plan.  It includes:

  • Updates to the Emission Trading System (ETS), their version of Cap & Trade, including covering more sectors of the economy, reduced allowances available, and an agreement for member states to dedicate all of their ETS revenues to climate and energy-related projects.
  • Carbon pricing extended to include the aviation and marine sectors.
  • A Social Climate Fund dedicated to supporting the most vulnerable citizens and small businesses through the green transition.
  • A target for 42.5% of electricity to come from renewables in 2030
  • All requirement for all new cars and vans to be zero-emission vehicles (ZEVs) by 2035
  • A target to boost natural carbon sinks
  • A carbon border adjustment mechanism (CBAM) to prevent unfair advantages for imports from places with less stringent climate policies and lower carbon pricing

As you can see, the EU is well ahead of the United States on climate policy and even ahead of California on some of those topics.  There is a real opportunity for us to learn from them and cooperate with them in our climate efforts.

The MEPs stressed their interest in working with California and their hope that California can use its leadership on climate to bring the rest of the country along.  (I share that hope!) They want to harmonize climate policies with other major economies, especially the United States, but they find it hard to align their policies (based on pricing carbon and implementing sector-specific regulatory policies to drive down emissions – much like California’s approach) with US policies based almost entirely on subsidies (tax credits and federal grants to favored projects).  I definitely agree that an approach based only on carrots, with no sticks, can only take us so far, but given the dysfunction and climate denialism in Congress, we have to take what we can get for now. 


As much as we love the boost that the IRA and IIJA have given to clean energy and climate progress here in America, our European allies are concerned that industrial policies in those laws, especially the local sourcing requirements, are going to get in the way of Europe and America working together.  They fully understand and agree with the desire to improve the security of supply chains for critical minerals and components and the necessity of building political support for green policies by making sure they include high quality green jobs.  However, they would like to see openness for trade between the US, EU, and other allied countries so that we can all work together efficiently on this challenge rather than having a race-to-the-bottom to subsidize our own local companies.  I think we, here in Silicon Valley, understand the value of trade.  Ours is an economy built on exporting world-leading technology to the rest of the world, as well as drawing upon the best technology from our partners worldwide.  We want to reduce our vulnerability to disruptions or extortion from countries that are geopolitical rivals and don’t share our values, and we should implement carbon border adjustment tariffs to level up the costs of products coming from countries that do not implement similarly ambitious climate policies.  We also want to bring manufacturing jobs back to this country and, especially, to boost clean energy-related manufacturing jobs here in California.  At the same time, we should remain open to building efficient global supply chains among allied countries with similar values and similar commitment to cleaning up their economies – which clearly includes the European Union. 

As we discussed the challenges they were facing and whether California had any helpful experience in solving them, it was fascinating how similar the challenges are.  Some examples of their questions for me:

  • What do we need to do to restructure our electricity system to accelerate the conversion from fossil fuels to clean electricity and to expand the grid to handle far more power?
  • What are we doing to speed up the process of doing environmental reviews and permitting projects so that we can build clean energy infrastructure at a fast enough pace?
  • Do we have good approaches for involving communities and citizens so they are bought into climate efforts and feel like they are benefiting from climate investments?
  • How do we deal with concerns about emissions “leakage” (shifting production out of state to places with weaker environmental standards) as the price on carbon increases (in our Cap & Trade system or their ETS)?

If those topics sound familiar, it is because we struggle with them in California, too.  A lot of my legislative work has focused on speeding up the transition of the electricity sector to clean energy and making sure we’re upgrading the grid so it can deliver far more clean energy as we electrify transportation and buildings.  We’ve also made some progress on speeding up siting and permitting processes, but that is still a struggle.  My bill to streamline approvals for upgrading neighborhood-scale electricity lines (SB 420) passed the legislature this year but was vetoed by the Governor because the Public Utilities Commission didn’t want their power eroded.  Sometimes it is “two steps forward, one step back.”   

To address emissions “leakage,” the European Union has recently passed a law to implement a carbon border adjustment mechanism (CBAM) to put tariffs on imports, charging them the same price on carbon as the ETS market price for their embodied carbon (emissions that occurred outside the EU).  This is a great approach, but very complex to implement.  It is very difficult, for example, to estimate the embodied carbon in imported products, and we don’t know how much we can trust the reported emissions of products coming from other countries with a poor track record for openness and transparency.  I included the option for CARB to implement a CBAM in my net-zero cement bill (SB 596, 2021), but it is even harder for California to implement (as a state with limited ability to tax interstate commerce) than it is for the EU, so CARB will probably try other approaches to reduce leakage before attempting a CBAM.  


For all the similarity, there was one way in which the situation in the EU is strikingly different from us here in the US.  The MEPs were from four different parties across the political spectrum, with the largest group being members of their center-right party.  All of them believed that climate change is an urgent policy priority and were committed to finding policy solutions.  Just imagine how much more could we get done in California, not to mention nationally, if we could ever get similar support for climate action from our colleagues on the political right!   


I enjoyed meeting this group of MEPs, who are so dedicated to moving their coalition of countries to become, as their European Green Deal says, “the first carbon neutral continent by 2050.”  I hope we can continue to share best practices and challenge each to get the job done.  The more states and countries that can work together on this, the better our chances of saving this planet in time.