BRUSSELS — The European Commission has unveiled a new plan to end the dominance of planet-heating fossil fuels in Europe’s economy — and replace them with trees. The so-called Bioeconomy Strategy, released Thursday, aims to replace fossil fuels in products like plastics, building materials, chemicals and fibers with organic materials that regrow, such as trees and crops. “The bioeconomy holds enormous opportunities for our society, economy and industry, for our farmers and foresters and small businesses and for our ecosystem,” EU environment chief Jessika Roswall said on Thursday, in front of a staged backdrop of bio-based products, including a bathtub made of wood composite and clothing from the H&M “Conscious” range. At the center of the strategy is carbon, the fundamental building block of a wide range of manufactured products, not just energy. Almost all plastic, for example, is made from carbon, and currently most of that carbon comes from oil and natural gas. But fossil fuels have two major drawbacks: they pollute the atmosphere with planet-warming CO2, and they are mostly imported from outside the EU, compromising the bloc’s strategic autonomy. The bioeconomy strategy aims to address both drawbacks by using locally produced or recycled carbon-rich biomass rather than imported fossil fuels. It proposes doing this by setting targets in relevant legislation, such as the EU’s packaging waste laws, helping bioeconomy startups access finance, harmonizing the regulatory regime and encouraging new biomass supply. The 23-page strategy is light on legislative or funding promises, mostly piggybacking on existing laws and funds. Still, it was hailed by industries that stand to gain from a bigger market for biological materials. “The forest industry welcomes the Commission’s growth-oriented approach for bioeconomy,” said Viveka Beckeman, director general of the Swedish Forest Industries Federation, stressing the need to “boost the use of biomass as a strategic resource that benefits not only green transition and our joint climate goals but the overall economic security.” HOW RENEWABLE IS IT? But environmentalists worry Brussels may be getting too chainsaw-happy. Trees don’t grow back at the drop of a hat and pressure on natural ecosystems is already unsustainably high. Scientific reports show that the amount of carbon stored in the EU’s forests and soils is decreasing, the bloc’s natural habitats are in poor condition and biodiversity is being lost at unprecedented rates. Protecting the bloc’s forests has also fallen out of fashion among EU lawmakers. The EU’s landmark anti-deforestation law is currently facing a second, year-long delay after a vote in the European Parliament this week. In October, the Parliament also voted to scrap a law to monitor the health of Europe’s forests to reduce paperwork. Environmentalists warn the bloc may simply not have enough biomass to meet the increasing demand. “Instead of setting a strategy that confronts Europe’s excessive demand for resources, the Commission clings to the illusion that we can simply replace our current consumption with bio-based inputs, overlooking the serious and immediate harm this will inflict on people and nature,” said Eva Bille, the European Environmental Bureau’s (EEB) circular economy head, in a statement. TOO WOOD TO BE TRUE Environmental groups want the Commission to prioritize the use of its biological resources in long-lasting products — like construction — rather than lower-value or short-lived uses, like single-use packaging or fuel. A first leak of the proposal, obtained by POLITICO, gave environmental groups hope. It celebrated new opportunities for sustainable bio-based materials while also warning that the “sources of primary biomass must be sustainable and the pressure on ecosystems must be considerably reduced” — to ensure those opportunities are taken up in the longer term. It also said the Commission would work on “disincentivising inefficient biomass combustion” and substituting it with other types of renewable energy. That rankled industry lobbies. Craig Winneker, communications director of ethanol lobby ePURE, complained that the document’s language “continues an unfortunate tradition in some quarters of the Commission of completely ignoring how sustainable biofuels are produced in Europe,” arguing that the energy is “actually a co-product along with food, feed, and biogenic CO2.” Now, those lines pledging to reduce environmental pressures and to disincentivize inefficient biomass combustion are gone. “Bioenergy continues to play a role in energy security, particularly where it uses residues, does not increase water and air pollution, and complements other renewables,” the final text reads. “This is a crucial omission, given that the EU’s unsustainable production and consumption are already massively overshooting ecological boundaries and putting people, nature and businesses at risk,” said the EEB. Delara Burkhardt, a member of the European Parliament with the center-left Socialists and Democrats, said it was “good that the strategy recognizes the need to source biomass sustainably,” but added the proposal did not address sufficiency. “Simply replacing fossil materials with bio-based ones at today’s levels of consumption risks increasing pressure on ecosystems. That shifts problems rather than solving them. We need to reduce overall resource use, not just switch inputs,” she said. Roswall declined to comment on the previous draft at Thursday’s press conference. “I think that we need to increase the resources that we have, and that is what this strategy is trying to do,” she said.

As trilogue negotiations on the End-of-Life Vehicles Regulation (ELVR) reach their decisive phase, Europe stands at a crossroads, not just for the future of sustainable mobility, but also for the future of its industrial base and competitiveness. The debate over whether recycled plastic content in new vehicles should be 15, 20 or 25 percent is crucial as a key driver for circularity investment in Europe’s plastics and automotive value chains for the next decade and beyond. The ELVR is more than a recycled content target. It is also an important test of whether and how Europe can align its circularity and competitiveness ambitions. Circularity and competitiveness should be complementary  Europe’s plastics industry is at a cliff edge. High energy and feedstock costs, complex regulation and investment flight are eroding production capacity in Europe at an alarming rate. Industrial assets are closing and relocating. Policymakers must recognize the strategic importance of European plastics manufacturing. Plastics are and will remain an essential material that underpins key European industries, including automotive, construction, healthcare, renewables and defense. Without a competitive domestic sector, Europe’s net-zero pathway becomes slower, costlier and more import-dependent. Without urgent action to safeguard plastics manufacturing in Europe, we will continue to undermine our industrial resilience, strategic autonomy and green transition through deindustrialization. The ELVR can help turn the tide and become a cornerstone of the EU’s circular economy and a driver of industrial competitiveness. It can become a flagship regulation containing ambitious recycled content targets that can accelerate reindustrialization in line with the objectives of the Green Industrial Deal. > Policymakers must recognize the strategic importance of > European plastics manufacturing. Without a competitive domestic sector, > Europe’s net-zero pathway becomes slower, costlier and more import-dependent. Enabling circular technologies  The automotive sector recognizes that its ability to decarbonize depends on access to innovative, circular materials made in Europe. The European Commission’s original proposal to drive this increased circularity to 25 percent recycled plastic content in new vehicles within six years, with a quarter of that coming from end-of-life vehicles, is ambitious but achievable with the available technologies and right incentives. To meet these targets, Europe must recognize the essential role of chemical recycling. Mechanical recycling alone cannot deliver the quality, scale and performance required for automotive applications. Without chemical recycling, the EU risks setting targets that look good on paper but fail in practice. However, to scale up chemical recycling we must unlock billions in investment and integrate circular feedstocks into complex value chains. This requires legal clarity, and the explicit recognition that chemical recycling, alongside mechanical and bio-based routes, are eligible pathways to meet recycled content targets. These are not technical details; they will determine whether Europe builds a competitive and scalable circular plastics industry or increasingly depends on imported materials. A broader competitiveness and circularity framework is essential  While a well-designed ELVR is crucial, it cannot succeed in isolation. Europe also needs a wider industrial policy framework that restores the competitiveness of our plastics value chain and creates the conditions for increased investment in circular technologies, and recycling and sorting infrastructure. We need to tackle Europe’s high energy and feedstock costs, which are eroding our competitiveness. The EU must add polymers to the EU Emissions Trading System compensation list and reinvest revenues in circular infrastructure to reduce energy intensity and boost recycling. Europe’s recyclers and manufacturers are competing with materials produced under weaker environmental and social standards abroad. Harmonized customs controls and mandatory third-party certification for imports are essential to prevent carbon leakage and ensure a level playing field with imports, preventing unfair competition. > To accelerate circular plastics production Europe needs a true single market > for circular materials. That means removing internal market barriers, streamlining approvals for new technologies such as chemical recycling, and providing predictable incentives that reward investment in recycled and circular feedstocks. Today, fragmented national rules add unnecessary cost, complexity and delay, especially for the small and medium-sized enterprises that form the backbone of Europe’s recycling network. These issues must be addressed. Establishing a Chemicals and Plastics Trade Observatory to monitor trade flows in real time is essential. This will help ensure a level playing field, enabling EU industry and officials to respond promptly with trade defense measures when necessary. We need policies that enable transformation rather than outsource it, and these must be implemented as a matter of urgency if we are to scale up recycling and circular innovations and investments.  A defining moment for Europe’s competitiveness and circular economy > Circularity and competitiveness should not be in conflict; together, they will > allow us to keep plastics manufacturing in Europe, and safeguard the jobs, > know-how, innovation hubs and materials essential for the EU’s climate > neutrality transition and strategic autonomy. The ELVR is not just another piece of environmental legislation. It is a test of Europe’s ability to turn its green vision into industrial reality. It means that the trilogue negotiators now face a defining choice: design a regulation that simply manages waste or one that unleashes Europe’s industrial renewal. These decisions will shape Europe’s place in the global economy and can provide a positive template for reconciling our climate and competitiveness ambitions. These decisions will echo far beyond the automotive sector. Disclaimer POLITICAL ADVERTISEMENT * The sponsor is Plastics Europe AISBL * The advertisement is linked to policy advocacy on the EU End-of-Life Vehicles Regulation (ELVR), circular plastics, chemical recycling, and industrial competitiveness in Europe. More information here.

The European Commission will present a new plan to break the EU’s dependencies on China for critical raw materials, President Ursula von der Leyen announced on Saturday. The EU executive chief warned of “clear acceleration and escalation in the way interdependencies are leveraged and weaponized,” in a speech Saturday at the Berlin Global Dialogue. In recent months, China has tightened export controls over rare earths and other critical materials. The Asian powerhouse controls close to 70 percent of the world’s rare earths production and almost all of the refining. The EU’s response “must match the scale of the risks we face in this area,” von der Leyen said, adding that “we are focusing on finding solutions with our Chinese counterparts.” Brussels and Beijing are set to discuss the export controls issue during meetings next week. “But we are ready to use all of the instruments in our toolbox to respond if needed,” the head of the EU executive warned. This suggests that the Commission could make use of the EU’s most powerful trade weapon — the Anti-Coercion Instrument. This comes after French President Emmanuel Macron called on the EU executive to trigger the trade bazooka at a meeting of EU leaders on Thursday. His push has not met with much support from the other leaders around the table. NEW BREAKAWAY PLAN To break the EU’s over-reliance on China for critical materials imports and refining, the Commission will put forward a “RESourceEU plan,” von der Leyen said. She did not provide much detail about the plan, nor when it would be presented. But she said it would follow a similar model as the REPowerEU plan that the Commission introduced in 2022 to phase out Russian fossil fuels after Moscow’s illegal invasion of Ukraine. Under REPowerEU, the Commission proposed investing €225 billion to diversify energy supply routes, accelerate the deployment of renewables, improve grids interconnections across the bloc and boost the EU hydrogen market, among other measures. The EU executive also put forward a legislative proposal, which is currently under negotiations with the European Parliament and the Council, to ban Russian gas imports by the end of 2027. The aim of RESourceEU “is to secure access to alternative sources of critical raw materials in the short, medium and long term for our European industry,” von der Leyen explained. “It starts with the circular economy. Not for environmental reasons. But to exploit the critical raw materials already contained in products sold in Europe,” she said. She added that the EU “will speed up work on critical raw materials partnerships with countries like Ukraine and Australia, Canada, Kazakhstan, Uzbekistan, Chile and Greenland.” “Europe cannot do things the same way anymore. We learned this lesson painfully with energy; we will not repeat it with critical materials,” von der Leyen said.

A group of 24 European politicians whose blood was tested for toxic PFAS chemicals over the summer all had the substances in their bodies, the NGOs involved in the testing revealed Tuesday. “I tested positive for four substances, and three of them can harm unborn children, act as endocrine disruptors, cause liver damage, and are suspected of being carcinogenic,” said Danish Environment Minister Magnus Heunicke in a written statement, describing his results as a “frightening reality.” It is “crucial that we take strong action against PFAS pollution so that we are no longer continuously exposed to these harmful chemicals,” he added. PFAS substances, commonly known as forever chemicals, don’t break down naturally and have been shown to accumulate in the environment and cause a host of health problems, including cancer, liver damage and decreased fertility. Most people in the world have some level of PFAS in their blood. For half of the EU leaders tested, contamination reached levels where health impacts are possible, according to the European Environmental Bureau and ChemSec. One person had levels indicating a potential risk of long-term health effects. The test results come days after the U.N. Special Rapporteur on Toxics and Human Rights Marcos Orellana slammed Brussels for proposing to dilute several chemical protection laws to help boost European industry. Denmark orchestrated the group test during a meeting of EU environment ministers in the northern Danish city of Aalborg in July. The country currently holds the rotating presidency of the Council of the EU and is one of five European countries that sent a joint proposal to the European Commission to phase out thousands of PFAS chemicals under EU chemicals law back in 2023. That proposal — currently in the hands of the European Chemicals Agency — has come under fire from industry groups, many of which are calling for exemptions to the proposed law. Tested politicians included EU Environment Commissioner Jessika Roswall, outgoing French Ecological Transition Minister Agnès Pannier-Runacher and Federal German Environment Minister Carsten Schneider. “Like many other citizens across Europe, I have PFAS in my body,” said Roswall in a written statement. “I tested positively on 6 out of 13 PFAS, including some that are classified as toxic for reproductive health. PFAS pollution is a vital public health issue.” The results of one of the test participants — Executive Director of the European Environment Agency Leena Ylä-Mononen — showed a decline in PFAS levels since she last had her blood tested, “reflecting trends observed among the European population for restricted PFAS.” Roswall has stated that the Commission will propose phasing out consumer uses of PFAS and exempt certain critical industries, which are yet to be defined. PFAS are involved in the production processes of several sectors, including semiconductors, batteries and pharmaceuticals. Those promises of exemptions have worried environmental groups, which are hoping for a wide-reaching phase-out of the chemicals. In a written statement on the tests, ChemSec’s Anne-Sofie Bäckar called for a “universal ban on all PFAS — not just in consumer products — before another generation pays the price for industry’s delay.” The Commission is expected to release its revision of the major chemicals regulation, REACH, this year, although the timeline is uncertain. The EU institutions are also working on a separate Commission proposal to simplify a set of EU laws spanning cosmetics, fertilizer and chemical classification regulations in a “chemicals omnibus” bill. U.N. Special Rapporteur on Toxics and Human Rights Marcos Orellana last week said the proposal risked undermining the European Union’s credibility as a “global leader in green policy and the rule of law.”

The leaders of France and Germany issued a joint call Friday for cuts to EU water pollution and chemical safety rules, in a bid to help European industry.   In a joint statement adopted at the 25th Franco-German Council of Ministers in Toulon, France, French President Emmanuel Macron and German Chancellor Friedrich Merz backed calls for a revision of REACH — the EU’s chemical legal framework — that’s focused on “reducing burdens” by “streamlining procedures.”  It comes months before the European Commission is due to present its long-delayed revision of REACH. The EU executive has signaled that the revision’s primary aim would be to simplify rules and speed up procedures for industry — to the dismay of civil society groups.  The two governments also pushed for an easing of financial constraints for Europe’s struggling chemicals industry. Merz and Macron pushed for an easing of recently-revised urban wastewater rules, which require cosmetics and pharmaceuticals companies to bear the bulk of the costs of cleaning up micropollutants in urban wastewater from the end of 2028. The Commission has already committed to producing an updated study on impacts of the extended producer responsibility scheme, following strong industry pushback.   The statement from the EU’s two biggest economies sends a strong message to Brussels to push ahead with its drive to cut red tape. “To unleash our companies’ full potential of growth and productivity it is … urgent to substantially ease the complexity and simplify the European Union’s regulatory environment,” the document states.  MATERIALS RECYCLING FOCUS  The two leaders repeated calls for better rules to facilitate the recycling and reuse of critical raw materials (CRM), as EU countries scramble to reduce dependency on Chinese minerals essential in defense and the energy transition.   Paris and Berlin committed to “work together on the design of the CRM aspects of the Circular Economy Act and coordinate their efforts” in the hope of “reaping the benefits” of the policy proposal, the draft reads.   The Circular Economy Act is expected in 2026 and aims to facilitate the transfer of materials waste between EU countries to boost recycling and reuse across European industries.   Back in 2023, the two EU countries had already pledged further cooperation on critical raw materials alongside Italy, including by setting up working groups for new extraction, processing and recycling projects.   Giorgio Leali contributed reporting.

Policymakers are overlooking a $370 billion market that will determine whether climate goals succeed or fail.  In the grand narrative of the clean energy transition, materials like lithium, rare earths and silicon dominate headlines. Yet the most strategically important materials for this transition may be hiding in plain sight, dismissed by policymakers as environmental villains rather than recognized as the enablers of human progress they truly are. The $370 billion blind spot Polyolefins — the family of materials that includes polyethylene and polypropylene — represent perhaps the greatest strategic oversight in contemporary clean industry policy Here is a reality check. Polyolefins represent a global market approaching $370 billion, growing at over 5 percent annually.1,2 They make up nearly half of all plastics consumed in Europe.3 By 2034, global production is expected to hit 371 million tons.4  Yet in the European Union’s Clean Industrial Deal — a €100 billion strategy for industrial competitiveness — polyolefins receive barely a mention.4 This represents a profound strategic miscalculation. While policymakers focus on securing access to exotic critical materials like lithium and cobalt, they overlook the fact that polyolefins are already critical materials— they simply happen to be abundant rather than scarce. In the infrastructure-intensive clean energy transition ahead, abundance is not a weakness; it is the ultimate strategic advantage. > While policymakers focus on securing access to exotic critical materials like > lithium and cobalt, they overlook the fact that polyolefins are already > critical materials. The EU’s REPowerEU plan calls for 1,236 GW of renewable capacity by 2030 — more than double today’s levels.4 Every offshore wind farm, solar array and electric grid connection depends on polyolefins. They insulate cables, protect components and form structural parts of turbines and solar panels. Every solar panel relies on polyolefin elastomers to protect its inner workings for up to 30 years, even in harsh weather.8 And every grid connection depends on polyethylene-insulated cables to carry electricity efficiently across long distances. 7 Multiply these requirements across thousands of installations, and the strategic importance of polyolefins becomes undeniable. Yet, currently, the policy framework treats these materials as afterthoughts, focusing instead on the relatively small quantities of rare elements in generators and inverters while ignoring the massive volumes of polyolefins that make the entire system possible. Beyond energy: the hidden dependencies The strategic importance of polyolefins extends far beyond energy infrastructure. As one example, modern medical systems depend fundamentally on polyolefin materials for syringes, IV bags, tubing and protective equipment. Global food security increasingly depends on polyolefin-based packaging systems that extend shelf life, reduce waste and enable distribution networks — feeding billions of people. Meanwhile, water infrastructure relies on polyethylene pipes engineered for 100-year lifespans. These applications are rarely considered alongside energy priorities — a dangerous fragmentation of strategic thinking. The waste challenge and a circular solution Let’s be clear, plastic waste is a real environmental challenge demanding urgent action. However, the solution is not abandoning these essential materials, it is building the infrastructure to capture their full value in circular systems. The fundamental error in current approaches is treating waste as a material problem rather than a systems problem. Europe currently captures only 23 percent of polyolefin waste for recycling, despite these materials representing nearly two-thirds of all post-consumer plastic waste.3 That’s not because the material can’t be recycled. The infrastructure to do so isn’t at the scale needed to collect, sort and recycle waste to meet future circular feedstock needs. Polyolefins are among the most recyclable materials we have. They can be mechanically recycled multiple times. And with chemical recycling, they can even be broken down to their molecular building blocks and rebuilt into virgin-quality material. That’s not just circularity, it’s circularity at scale. This matters because the EU’s target of 24 percent material circularity by 20305 is unlikely to be met without polyolefins. However, current frameworks treat them as obstacles rather than enablers of circularity. The economic transformation The transition represents an economic transformation, creating competitive advantages for regions implementing it effectively. A region processing 100,000 tons of polyolefin waste annually could capture €100-130 million in additional economic value while creating up to 1,000 jobs.6 > A region processing 100,000 tons of polyolefin waste annually could capture > €100-130 million in additional economic value while creating up to 1,000 jobs. At the end of the day, the clean energy transition must be affordable. Polyolefins help make that possible. They’re cheaper, lighter and longer lasting than many alternatives. Manufacturers with access to cost-effective recycled feedstocks can reduce input costs by 20-40 percent compared with virgin materials. Polyethylene pipes cost 60-70 percent less than steel alternatives while lasting twice as long.9 These aren’t marginal gains. They’re system-level efficiencies that make the difference between success and failure at scale. The strategic choice The real challenge isn’t technical, it’s institutional. Polyolefins sit at the crossroads of materials, environmental and industrial policy, yet these areas are treated as separate domains. There’s also a geopolitical angle. Unlike lithium or rare earths, polyolefins can be produced from diverse feedstocks — natural gas, biomass and even captured CO2 — enabling domestic production and supply chain resilience. This flexibility is a major asset, but current policies largely overlook it. > The path forward requires recognizing polyolefins as strategic assets rather > than environmental problems. The path forward requires recognizing polyolefins as strategic assets rather than environmental problems. This means including them in critical materials assessments — not because they are scarce, but because they are essential. It means coordinating research and development efforts rather than leaving them to fragmented market forces. Most importantly, it means recognizing that the clean energy transition will succeed or fail based on our ability to build infrastructure at unprecedented scale and speed. And that infrastructure will be built primarily from materials that combine performance, abundance, sustainability and cost-effectiveness in ways only polyolefins can provide. The choice facing policymakers is clear: continue treating polyolefins as problems to be managed or recognize them as strategic assets enabling the clean energy future. The regions that understand this integration first will shape the global economy for decades to come. -------------------------------------------------------------------------------- 1. Grand View Research. (2024). Polyolefin Market Size, Share, Growth | Industry Report, 2030. Retrieved from https://www.grandviewresearch.com/industry-analysis/polyolefin-market 2. Fortune Business Insights. (2024). Polyolefin Market Size, Share & Growth | Global Report [2032]. Retrieved from https://www.fortunebusinessinsights.com/polyolefin-market-102373 3. Plastics Europe. (2025). Polyolefins. Retrieved from https://plasticseurope.org/plastics-explained/a-large-family/polyolefins-2/ 4. European Commission. (2025). Clean Industrial Deal. Retrieved from https://commission.europa.eu/topics/eu-competitiveness/clean-industrial-deal_en 5. European Commission. (2022). Circular economy action plan. Retrieved from https://environment.ec.europa.eu/strategy/circular-economy-action-plan_en 6. Watkins, E., & Schweitzer, J.P. (2018). Moving towards a circular economy for plastics in the EU by 2030. Institute for European Environmental Policy. Retrieved from https://ieep.eu/wp-content/uploads/2022/12/Think-2030-A-circular-economy-for-plastics-by-2030-1. 7. Institute of Sustainable Studies (2025). EU Circular Economy Act aims to double circularity rate by 2030 EU Circular Economy Act – Institute of Sustainability Studies 8. López-Escalante, M.C., et al. (2016). Polyolefin as PID-resistant encapsulant material in PV modules. Solar Energy Materials and Solar Cells, 144, 691-699. Retrieved from https://www.sciencedirect.com/science/article/pii/S0927024815005206 9. PE100+ Association. (2014). Polyolefin Sewer Pipes – 100 Year Lifetime Expectancy. Retrieved from https://www.pe100plus.com/PPCA/Polyolefin-Sewer-Pipes-100-Year-Lifetime-Expectancy-p1430.html --------------------------------------------------------------------------------

The little Basque village of Zubieta has an unlikely talent for a place its size: This community of 300 souls can make the trash of half a million people vanish into thin air. Each year, as much as 200,000 metric tons of waste from across northwestern Spain is trucked to the Gipuzkoa treatment plant on the edge of the village. There it is sorted and fed into a giant incinerator, generating enough electricity to power 45,000 homes. The Gipuzkoa plant was meant to be an eco-friendly alternative to landfill, but it’s backfiring. Locals have accused the plant’s owners and the regional government of violating European Union environmental laws and releasing hazardous levels of pollution into the surrounding water, air and soil. It’s even spurred a criminal court case. “The court has to decide if the environmental permit [granted by the local government] is in accordance with [the] EU directive on pollution,” says Joseba Belaustegi Cuesta, a member of the grassroots GuraSOS movement that is campaigning against the incinerator. Gipuzkoa is not a one-off. Across Europe, hundreds of waste-to-energy facilities have mushroomed over the years, built on the promise that burning trash to generate electricity is better for the environment than burying it in a landfill. But studies increasingly find that the pollution generated by these facilities also harms the environment and people’s health. The EU, meanwhile, has massively reduced funding for such projects, while municipalities are still repaying the debt they accrued to fund them. At best, critics say, waste-to-energy plants risk becoming unpopular relics of a misguided waste policy. At worst the existing debt-funded plants could become “stranded assets” that struggle to find enough trash to burn to ensure they remain commercially viable. Gipuzkoa itself was financed with €80 million worth of bonds whose repayment date is 2047. The plant, in other words, needs to keep running for another two decades — regardless of the environmental cost. Belaustegi Cuesta complains that the incinerator now imports “residues that [are] not even household residues” to feed itself. French asset manager Meridiam, the biggest shareholder in the Gipuzkoa plant, did not respond to POLITICO’s request for comment. EUROPE’S WASTE PROBLEM Some 500 waste-to-energy plants operate on EU soil today and burn around a quarter of Europe’s everyday trash, according to waste-to-energy lobby CEWEP.   Plant operators and their investors say these furnaces are essential if Europe wants to meet its goal of sending less than 10 percent of household waste to landfills by 2035. In 2022 Europeans generated roughly 190 million metric tons of household waste, according to data from Brussels statistical office Eurostat. | Thomas Samson/AFP via Getty Images In 2022 Europeans generated roughly 190 million metric tons of household waste, according to data from Eurostat, Brussels’ statistical office. Despite recycling roughly 40 percent — more than any other region — the EU still buries a big chunk of its trash. More than 50 million metric tons of municipal waste were sent to landfills in the EU in 2023, enough to cover central Paris with a 20-meter pile of garbage.  Waste-to-energy is considered a slightly cleaner alternative: About 58 million metric tons were incinerated in 2023, nearly all of which was used to make energy, EU data shows. EU laws on waste require companies to prioritize reuse and recycling over waste incineration and landfilling. “The main objective of a waste-to-energy plant is not to produce energy; its primary purpose is to manage waste that cannot be recycled,” explained Patrick Dorvil, senior economist in the circular economy division of the European Investment Bank. The power generation benefits are often what the waste-to-energy lobby advertises when promoting the technology, however.  “With one week of your household’s residual waste, you have enough heat to warm your home for at least 8 hours,” CEWEP writes in its 2025 brochure. The lobby also claims that about 10 percent of district heating in Europe comes from energy made by burning waste, and that the technology contributes to renewable energy generation and landfill diversion.  POLLUTION CONCERNS But green groups say it’s a mistake to think waste-to-energy is a cleaner source of energy than fossil fuels. Poorly sorted municipal waste often means that a lot of fossil fuel-based plastic gets burnt, releasing planet-warming CO₂ in the process.  “The argument that burning waste is better than landfilling oversimplifies a complex issue. Both practices have serious environmental impacts and neither should be seen as a viable long-term solution,” said Janek Vahk, senior policy officer at Zero Waste Europe. The NGO estimates that each metric ton of municipal waste that is burned releases between 0.7 and 1.7 metric tons of CO₂. Scientists, meanwhile, warn that insufficient research has been conducted on the dangers faced by people living near incinerators. Plant operators insist that technological solutions and proper sorting can keep that pollution under control. But these concerns have not gone unnoticed, and popular backlash against waste incinerators is growing. In Rome, for example, tens of thousands of people signed a petition to stop the mayor from greenlighting a waste incineration project in Santa Palomba. And last March, French senators proposed to ban the construction of new waste incinerators in the country. The pollution concerns have led the EU to reduce its financial support for waste-to-energy plants and to introduce policy obligations meant to steer EU countries toward recycling.  Plant operators insist that technological solutions and proper sorting can keep pollution under control. | Christopher Neundorf/EPA Over the years, Brussels has introduced strict environmental conditions that projects must meet to receive EU funding. This has significantly reduced the amount of public funds allocated to waste incineration compared to larger sums earmarked for greener projects such as recycling plants.  Back in 2020, the technology’s carbon footprint was ultimately what prompted Brussels to exclude waste-to-energy plants from its list of eligible green projects. The list, called the EU taxonomy, tells investors what counts as a sustainable investment.  Meanwhile, local governments are stuck, environmental NGOs argue, with many still paying off the debt they accrued when agreeing to build the sites. “Many of these installation plans would turn out to be obsolete,” says Anelia Stefanova, energy transformation area leader for CEE Bankwatch, since EU countries are expected to meet waste reduction and recycling targets enforced by EU laws. STRANDED ASSETS As countries move toward greener waste management systems, the risk is that these large infrastructure projects could become useless. Many waste-to-energy plants already require more trash than tends to be available in the surrounding area. In Copenhagen, for example, the city’s infamous ski slope incinerator — itself financed through a 30-year loan —  imports tens of thousands of tons of waste from abroad annually to feed its furnaces.   Denmark has an “overcapacity in the incineration sector of up to 700,000” metric tons, according to its climate and energy ministry. The country is already budgeting to cover the costs of unnecessary waste incinerators. In 2020, Denmark introduced a plan to green the waste sector, which included allocating 200 million Danish kroner (€26 million) to municipalities to cover “stranded costs.” Lenders, including the EU’s official lending arm the European Investment Bank, are also acutely aware that the policy landscape has moved away from supporting the technology unconditionally. “Everything financed by the EIB must comply with EU directives. We are not policymakers; we are policy takers,” said the EIB’s Dorvil, adding that there have been plenty of cases where the bank has refused funding for financial or environmental reasons. Still, new waste-to-energy plants are in the works.  “When there are no incineration facilities then there [are] bigger landfills,” insists Hanna Zdanowska, mayor of the Polish city of Łódź. The city will soon have a new waste-to-energy plant planned by French energy company Veolia and paid for with a €97 million loan from the European Bank for Reconstruction and Development.  Zdanowska says the plant will increase the city’s “energy independence, which is also very important right now.” The EU’s Modernisation Fund is one of the last funding programs that still pays for waste-to-energy; it aims to help lower-income EU member countries transition their energy sectors away from fossil fuels. The €19 billion cash pot has poured just shy of €2 billion into waste-to-energy projects since its inception in 2021, all of them in Czechia and Poland. Asked if there’s a risk the new incinerator could become a stranded asset, Zdanowska said she “would love to have such a scenario that we really produce less waste in the future.”   “When the amount of waste goes down in the future and recycling goes up, then probably only a couple of plants will be left in the area and they will not limit themselves to collecting waste only from the city but they will expand their area for the whole region.”

There’s a butterfly-shaped hole in Brussels’ plans for a new European budget structure. The European Commission presented its controversial proposal to pool a number of existing funding programs into a single “Competitiveness Fund” last Wednesday, as part of a broader €1.816 trillion multiannual budget proposal that has angered EU countries and civil society groups alike.  Under the new plan, biodiversity goals have no earmarked funding at all — and will have to compete with the EU’s other environmental aims, including climate change, water security, the circular economy and pollution. Some warn that unless clearly allocated, money will inevitably flow to industrial projects that fit with the Commission’s competitiveness agenda, leaving unprofitable but no-less-urgent environmental programs unfunded. “[There’s a] real danger that biodiversity will be sidelined in favour of industrial priorities that may be presented as green investments,” said Ester Asin, director of the WWF European Policy Office. The EU is already facing an estimated €37 billion annual biodiversity funding gap, according to the Commission. In the proposed new budget structure, Europe’s existing €5.45 billion environmental funding program, known as LIFE, would merge with other funds dedicated to digitalization and defense into a €409 billion competitiveness cash pot. Money previously earmarked specifically for biodiversity has also now been merged with a catch-all “environment and climate” target.   The overall amount dedicated to funding green priorities will increase, the Commission argues, because 35 percent of the total budget — roughly €700 billion — will be dedicated to reaching the goals of the EU Green Deal. Around 43 percent of the Competitiveness Fund will go toward climate and environmental objectives, the Commission said Wednesday, to contribute to this overarching target.  “I think that this budget actually looks at it in a comprehensive way,” Environment Commissioner Jessika Roswall told POLITICO. “We have a lot of [environmental] legislations that are really good, but now we also need to give the results, and this budget is actually addressing exactly this.” “I think that this budget actually looks at it in a comprehensive way,” Environment Commissioner Jessika Roswall told POLITICO. | Guillaume Horcajuelo/EPA But not everyone is buying into the idea. “This is a devastating blow for Europe’s nature and its citizens,” said Birdlife Europe’s Anouk Puymartin in a statement, warning that biodiversity is “losing its place in the EU budget with no dedicated funding or clear prioritisation.” EMBEDDING SUSTAINABILITY With the new budget structure, the Commission wants environmental protection to be seen as a horizontal issue rather than a standalone financing priority.  The structure will “ensure that horizontal priorities are applied in a consistent way across the EU budget, including for climate and biodiversity, the ‘do no significant harm’ principle, social policies and gender equality,” it writes in the budget document. The “do no significant harm” principle dictates that EU policies and funds must not have a negative impact on the EU’s six environmental objectives, which include protecting and restoring nature. “What matters now is how sustainability is embedded into the governance and structure of the EU budget,” said Cornelius Müller, policy officer for the Sustainable Banking Coalition, a green finance lobby. “The EU needs to hardwire these principles into all financial instruments.” But some argue that conserving a nature-focused chunk of the financing is essential. WWF’s Asin is calling for “robust and transparent tracking methodologies” — without which the 35 percent target risks “becoming little more than a PR exercise.” In the current budget structure — on top of the 30 percent climate spending target — 7.5 percent of annual spending was to be allocated to biodiversity objectives in 2024, ramping up to 10 percent in 2026 and 2027. Under the new proposal, no target for biodiversity is stipulated. There is also no ring-fenced cash specifically allocated to water resilience, one of Brussels’s core concerns according to its 2024-2029 priorities. Some of Europe’s most water-stressed member countries, such as Spain and Portugal, had been asking that more money be dedicated to water resilience and risk management.

BRUSSELS — The European Commission made its opening play in what will be two years of haggling over the bloc’s spending plan for the seven-year period from 2028. European Commission President Ursula von der Leyen insisted the €1.8 trillion plan would make the EU’s cash pot “larger,” “smarter” and “sharper,” and that the budget was “the most ambitious ever proposed.” But, in a sign of the heated negotiations to come, disappointed lawmakers were quick to contradict von der Leyen’s claims, saying the Commission has misleadingly represented adjustments to the — major — inflation in recent years as an increase in the EU’s budget. “The European Commission will present different budgetary lines, which have increased. But, of course, if the budget remains at the same level, then that means that several budgetary lines would have to decrease,” Romania’s Siegfried Mureșan, a member of the center-right European People’s Party, said. All national capitals, as well as the European Parliament, must agree on the plan before it is approved. As battle lines get drawn, POLITICO’s drawn up a handy guide to who’s up — and who’s down — in the initial proposal. LOSER: FARMERS Farmers are furious.  In the last EU long-term budget, the Common Agricultural Policy (CAP) came in at €386.6 billion. This time, €300 billion has been set aside for agriculture. To add insult to injury, while the CAP used to form a standalone section of the budget, it has now been merged with funding for other policies in a cash pot for “National and Regional Partnership Plans.” Under those plans, European countries need to spend a minimum €300 billion on agriculture and could spend more should they choose to do so. But the farmers groups protesting outside the Parliament and Commission are not feeling optimistic. LOSER: TOBACCO While the vast majority of the budget will come from EU countries’ own contributions, the also Commission proposed three new taxes targeting electric waste, large companies and tobacco products such as cigarettes and cigars. These goods are currently being taxed by individual countries, who keep the revenues for themselves. The aim is to generate from €25 billion to €30 billion per year that will be used to repay EU joint debt that was used to finance its post-Covid recovery. Cigarette prices are already set to rise across the EU under a long-awaited update to the Tobacco Tax Directive, with rough estimates saying the price of a pack will rise by €1-2. For the first time, alternative products such as e-cigarettes and heated tobacco will be subject to a minimum rate, albeit lower than for traditional cigarettes. LOSER: NATURE Biodiversity is set to lose its dedicated slice of the EU budget, instead being absorbed into a broader “climate and environment” target that would amount to 35 percent of the budget, reaching roughly €700 billion. Previously — on top of the 30 percent climate spending target — 7.5 percent of annual spending was to be allocated to biodiversity objectives in 2024, ramping up to 10 percent in 2026 and 2027. The new “climate and environment” target would serve all six of the EU’s environmental objectives, spanning from climate and biodiversity to the circular economy and pollution prevention. | Romain Perrocheau/AFP via Getty Images The new “climate and environment” target would serve all six of the EU’s environmental objectives, spanning from climate and biodiversity to the circular economy and pollution prevention. The LIFE program — dedicated funding for the environment and climate action — has also been absorbed into the “National and Regional Plans,” as well as the €410 billion “Competitiveness Fund” that bundles several existing funding programs. Some NGOs are warning the changes could mean that biodiversity funding loses out. The EU is already facing an estimated €37 billion annual biodiversity funding gap, according to the European Commission. WINNER: EASTERN COUNTRIES AND UKRAINE  Eastern countries scored a major victory Wednesday when the Commission announced that the eastern regions, and particularly those bordering Ukraine, Russia and Belarus, will receive more funds than the others to meet both their security and economic needs.  They also won another battle: Although the EU was desperate for fresh money for its coffers, it did not include the revenue from an already-planned extension of the EU emissions trading scheme to buildings and road transport in its proposed basket of new sources of revenue. Finally, the EU proposed supporting Ukraine’s reconstruction and its path to EU membership with an additional €100 billion. WINNER: ELECTRICITY BILL PAYERS  Under the proposal, the EU would dramatically ramp up support to modernize the bloc’s electricity grids to bring down power prices, which were singled out in a report by former European Central Bank chief Mario Draghi as Europe’s Achilles’ heel in competing with the U.S. and China. The Connecting Europe Facility, a fund that can be used to upgrade infrastructure and invest in new technologies, will see its energy budget rise to €30 billion from just €6 billion. Additionally, grids will get to tap into a massively expanded €410 billion competitiveness fund in a bid to reduce wastage and slash bills for industry and households. Draghi warned that “infrastructure investment is slow and suboptimal,” while persistently more expensive energy is forcing manufacturers to cut production or relocate. WINNER: DIGITAL TECHNOLOGIES The Commission wants to multiply the bloc’s money for digital technologies by a factor of five, von der Leyen said. This would bring digital funds to €54.8 billion in the next budget. That is a whopping increase in an area where, already, the EU was investing considerable funds for research and innovation. But the stakes have increased, with regions from the U.S. to China competing fiercely over transformative technologies — most notably artificial intelligence.  Digital is one of four pillars of a new, comprehensive Competitiveness Fund, which has a headline figure of €410 billion.  WINNER: DEFENSE The proposal of the Commission is to allocate at least €131 billion for defense and space, which means “five times what we have today” said von der Leyen. Separate budgets will also be used to boost the bloc’s defense readiness. The proposal “shows welcome ambition” said Hannah Neumann, a German Green MEP who sits in the European Parliament Defense Committee. The figure is in line with the needs identified early on by Defense Commissioner Andrius Kubilius when he first spoke to POLITICO late last year.  Separate budgets will also be used to boost the bloc’s defense readiness. | Bernd von Jutrczenka/Picture Alliance via Getty Images WINNER: RESEARCH AND CULTURE The bloc’s flagship research and development program, Horizon Europe, is set to nearly doubling to €175 billion. It is currently already one of the world’s largest such funds, with a €95 billion budget — though one group of experts has argued the EU should boost its research and development spending to €220 billion in order to stay competitive. The allocation for the EU’s flagship program for student mobility, Erasmus+, was increased by 50 percent to over €40 billion. The Commission also announced a new “AgoraEU” program worth €8.6 billion that will support culture, media and civil society organizations. “It’s a ground breaking day for Europe’s culture and creative sectors,” Education & Sports Commissioner Glenn Micallef told POLITICO. JURY’S OUT: MILITARY MOBILITY The Commission wants the bloc to set aside €17.7 billion for military mobility, according to Transport Commissioner Apostolos Tzitzikostas. On paper, that looks like a major win compared with the €1.7 billion military mobility budget in the current budget. In reality, it falls well short of the €75 billion or even €100 billion that Tzitzikostas had said was needed.  While parts of the civilian transport budget may support dual-use infrastructure — and additional defense funds might be tapped — military needs still appear only partially addressed. The Commission proposed that the future Connecting Europe Facility, the EU’s funding vehicle for infrastructure, should total €81.4 billion. About €51 billion would be earmarked for transport. JURY’S OUT: CITIES AND REGIONS The EU’s cohesion funding scheme is meant to boost growth in the bloc’s poorer regions and reduce inequality. It currently accounts for more a third of the EU’s current budget. But rather than be a standalone policy in the 2028 budget proposal, cohesion funding is instead addressed through so-called National and Regional Partnership Plans developed by national governments.  In a last-minute agreement, the Commission is promising that the bloc’s poorest regions will receive €218 billion in the next budget, which was a key demand of the regions commissioner Raffaele Fitto. But no such guarantees have been made for the rest of the EU, prompting fears that the overall amount allocated for regional development will be smaller than under the current budget. That’s bad news for cities and rural areas that rely on cohesion cash to finance everything from roads to public libraries. Moreover, local and regional leaders are worried about the proposed budget’s bid to give central governments outsized power to manage and distribute EU cash via the partnership plan scheme, and concerned that national leaders could punish political rivals by withholding access to the funds. Hanne Cokelaere, Leonie Cater, Pieter Haeck, Jacopo Barigazzi, Martina Sapio, Rory O’Neill, Lucia Mackenzie, Giovanna Faggionato, Gabriel Gavin, Aitor Hernández-Morales and Gregorio Sorgi contributed reporting.

BRUSSELS — The European Commission wants to funnel billions more into energy infrastructure as part of the EU’s next long-term budget. Energy ventures would see a significant increase in funds under the proposal. The Commission suggests earmarking €30 billion of its Connecting Europe Facility for energy infrastructure — up from €6 billion. That would mean more money for things like grid upgrades, battery storage and hydrogen infrastructure. “This reinforces energy independence and accelerates the clean transition,” Commission President Ursula von der Leyen told reporters as she unveiled the proposal. Von der Leyen also touted a new proposal to let countries take out loans of up to €150 billion backed by the EU for “EU objectives,” naming energy and defense as priorities. Grids could similarly receive funding from an expanded “competitiveness fund,” worth €410 billion in the Commission’s proposal. Former European Central Bank chief Mario Draghi warned in a highly touted report that Europe’s outdated grids were seriously hindering its ability to compete against the U.S. and China.  Within the competitiveness fund, von der Leyen also pitched a sixfold increase in “clean tech and decarbonization.” And overall, she said, 35 percent of her proposed EU budget would go toward climate and environment schemes, reaching roughly €700 billion.  That money would go toward efforts to adapt to climate change, protect water resources, prevent pollution and create a more circular economy. The 35 percent figure would merge what are currently two separate spending targets — 30 percent for climate and 10 percent for biodiversity — under the existing EU budget.  Environmental groups have been warning that such a change would result in less money going towards biodiversity objectives.