What is the Green Deal?

The Green Deal, which is among the powerful steps taken for a sustainable future, includes effective strategies against climate change and environmental degradation. Envisioning a competitive and modern economic structure where resources are used efficiently, the green deal is also a comprehensive transformation plan with its economic and social dimensions. Let's look together at what people wonder about the green deal, from its core components to its implementation challenges.

What is the Green Deal?

Introduced in 2019 by President of the European Commission Ursula von der Leyen, the Green Deal aims to reduce greenhouse gas emissions in the EU to net-zero by 2050. Shaped around the goal of eliminating climate change, the Green Deal aims to implement comprehensive policies and practices that support sustainable development.

The phrase Green Deal refers to the New Deal program, implemented by US President Franklin Delano Roosevelt between 1933 and 1939 to pull the US economy out of the Great Depression of 1929, which included public services along with economic and social reforms. However, while the Great Depression pointed to an existing crisis, the Green Deal focuses on a crisis that has not yet fully manifested, namely global warming, and the steps that must be taken to prevent this crisis. Global warming, which is a consequence of human activities, seriously threatens the well-being of future generations.

For the successful implementation of this plan, the active participation of all sectors is vital. In order to combat global warming effectively, relevant policies must be handled from a holistic perspective and an inclusive approach must be adopted. The core dimensions that the plan must focus on include climate, environment, energy, transport, industry, agriculture and sustainable finance. In the design and implementation processes of these practices, the strong and dynamic connections between these dimensions must be taken into account.

Components of the EU Green Deal

The Green Deal, one of the initiatives that will provide advantages in the fight against global warming and enable climate neutrality, can create many opportunities from creating new markets to developing new technologies. The key components of the Green Deal are:

Low-Cost, Clean and Secure Energy

In order to realize the targeted changes in the fight against climate change, making arrangements regarding the existing energy model is a requirement. The Green Deal focuses on the following points regarding energy:

• Renewable and sustainable energy sources such as offshore wind energy should be used.

• The use of fossil fuels such as coal in energy production should be limited, and in the long term, completely halted.

• Hydrogen and biogases, which are renewable gases, should be more preferred.

• Efforts to ensure energy efficiency should be prioritized.

• Smart infrastructures enabling processes such as carbon capture, storage and reuse should be developed to reduce carbon emissions originating from steel and cement production.

Circular Economy

Developed as an alternative to the linear economy, the circular economy model is shaped around extending the lifespan of products and thus utilizing resources efficiently. In the circular economy model, products that have reached the end of their lifespan are not discarded; instead, they are recycled and reused. Thanks to recycling practices, environmental pollution can be prevented as the amount of waste is reduced. The occurrence of changes in the production process and the increase in recycling can create new areas of expertise and jobs. Collaborations can be established between different sectors, making it easier for various industries to access resources.

Energy Efficiency, Sustainable Buildings and Employment Opportunities

Most of the buildings in European Union countries are old and need to be renovated to be transformed into sustainable structures. To align buildings with energy efficiency and implement circular economy policies in the construction sector, a renovation plan for both public and private buildings has been implemented. This situation can create new job opportunities and employment avenues for many individuals.

Sustainable Transport

The Green Deal also offers various recommendations for the transport sector, where carbon emissions are at high levels. In order to make transport vehicles more sustainable, eco-friendly and innovative alternatives must be adopted. In this context, practices such as promoting multimodal transport systems and accelerating the transition to electric vehicles stand out. These steps will make significant contributions both to reducing emissions and to increasing energy efficiency.

Protecting the Ecosystem and Biodiversity

The green deal is highly important for protecting the ecosystem and the biodiversity within this system. To ensure the protection of ecosystems, actions must be carried out to prevent damage to natural areas. Additionally, replanting natural areas damaged by forest fires or similar causes and restoring damaged ecosystems are among the practices recommended by the Green Deal.

Reducing Pollution for a Healthy Environment

Zero pollution initiatives aimed at reducing environmental pollution are one of the core components of the Green Deal. These initiatives include various policies aimed at protecting natural resources and minimizing environmental impacts. In this context, the 'farm to fork' approach, which specifically aims to reduce negative impacts on the environment during agriculture and food production processes, stands out. This approach aims to contribute to both the protection of the ecosystem and the improvement of public health by promoting sustainable agricultural practices.

According to data from the European Society of Cardiology, the fact that nearly 800,000 individuals die prematurely in Europe every year due to air pollution is one of the indicators expressing that rapid steps must be taken to prevent air pollution. To prevent this problem, it is of great importance to realign air quality legislation in accordance with the emission limits set by the World Health Organization. In addition to this, the use of chemical substances must be reduced and waste management must be carried out in accordance with international standards to ensure the protection of natural areas.

Challenges Facing the Green Deal

Requiring the implementation of comprehensive practices for a sustainable future, the Green Deal also brings along a set of challenges. Some of the challenges in front of the efficient implementation of the program are as follows:

External Dependence in Energy Transition

Completely ending the dependence on fossil fuels with high carbon emissions such as gas and oil in EU countries is considered a difficult goal in the short term. The main reason for this is that meeting the total energy demand solely with renewable sources does not seem possible under current conditions. In the transition to green energy, the necessity of sourcing raw materials such as cobalt and lithium, which are of critical importance especially for battery production, from non-EU countries may lead to countries facing a new risk of external dependence. This situation is also highlighted in the prepared green energy scenarios, stating that new dependencies could be added alongside old ones.

Critical Raw Materials

Critical raw materials have a vital importance for creating a sector with low carbon emissions. The 'critical raw material' status is given to raw materials that carry strategic value economically and are risky to supply due to the unreliability of their producers or transport routes. The European Union updates its lists of critical raw materials every three years. The data obtained from these lists reveal that the EU depends heavily on foreign suppliers for many critical raw materials. This situation demonstrates a different dimension of the external dependence of EU countries.

In accordance with the Green Deal, the European Union has a Critical Raw Materials Act regulating the process from the production to the distribution of critical raw materials. According to the Critical Raw Materials Act, there are specific criteria for the extraction, processing, and recycling of these substances. Increasing local raw materials, on the other hand, requires relaxing laws regarding mining activities. Because these laws impose restrictions due to the negative environmental impact of the mining operations in question.

Economic and Environmental Dilemmas

There are complex reactions within business circles regarding the economic and environmental impacts of the Green Deal. The Green Deal Industrial Plan and some proposed laws are met with negative reactions by certain sectors. These stakeholders complain about the high costs of local content and its negative impact on competitiveness. For example, the cost of manufacturing solar panels in EU countries is three times the cost that would arise if this production were carried out in China.

Environmental impacts are especially seen in the mining of critical raw materials. A significant portion of the critical raw material reserves located in EU countries are situated within or close to conservation areas. Since mining activities to be carried out in these areas would lead to severe environmental pollution and loss of biodiversity, implementing the principles of the Green Deal can be challenging.

Green Deal Industrial Plan

Developed within the scope of the European Union, the Green Deal Industrial Plan was published on February 1, 2023. The aim of this plan is to prevent the measures put into practice during the process of combating global warming from harming the industrial competitiveness and production capacity of EU countries. Supporting carbon-free production and supply processes, the plan leverages the European Union's subsidy power worth billions of euros.

The Green Deal Industrial Plan is based on four pillars. These pillars are:

• Predictable and Simplified Regulatory Framework: Creating favorable conditions for sectors important in reaching zero-carbon targets, such as wind and solar energy, with the Net-Zero Industry Act, and managing dependency risks by setting targets for industrial capacity by 2030. In addition, supporting key technology manufacturing and establishing partnerships on sourcing by securing access to rare earth elements with the Critical Raw Materials Act.

• Facilitating Access to Finance: Creating a common EU funding pool with the European Sovereignty Fund to ensure that every member state’s transition to clean technology is managed under fair conditions.

• Enhancing Skills: Creating training plans to meet the workforce needs that will arise during the transition to green technology and to create employment.

• Resilient Supply Chains and Open Trade: Adopting a fair approach to trade to reach zero-carbon targets, expanding trade networks, lowering costs, and protecting the EU market from competition that foreign investors might create.

The sole aim of the Green Deal Industrial Plan is not just to ensure decarbonization and realize the necessary innovations in this process. Additionally, the plan has some limiting factors. For instance, focusing only on energy security and critical raw materials may cause the plan to stop being inclusive. In addition to this, decarbonization practices are both costly and involve technical difficulties. This, in turn, can make the implementation of the industrial plan in question difficult.

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