Identification and removal environmentally harmful subsidies<\/b><\/li>\n<\/ul>\nFrom an analytical perspective, this \u201eecosystem\u201c approach, while complex, is more resilient than a single policy. It creates multiple levers \u2013 budgeting, private finance, damage prevention \u2013 to influence the economy. The biggest challenge, then, is not a lack of tools, but getting them to align without becoming a confusing administrative nightmare. One of the most powerful tools for ensuring this coherence is a principle that is rarely discussed\u2026<\/p>\n
2. The \u201eGreen Oath\u201c You Probably Haven\u2019t Heard of: Do No Significant Harm<\/h3>\n
One of the most influential, yet lesser-known, tools in the EU's arsenal is the principle of \u201e"Do No Significant Harm" (DNSH)<\/b>, therefore \u201e"not cause any significant harm"\u201c<\/b>. This principle is revolutionary because it goes beyond simply labeling projects as \u201egreen\u201c versus \u201ebrown\u201c and introduces a universal standard of environmental risk assessment for all of them<\/b> public finances.<\/p>\n
Its function is simple but extremely powerful. DNSH acts as a basic eligibility criterion that prevents any project<\/b> (even one that does not have a primary environmental objective) to receive funding if it would significantly harm one of the six key environmental objectives:<\/p>\n\n- Climate change mitigation<\/li>\n
- Adaptation to climate change<\/li>\n
- Sustainable use and protection of water and marine resources<\/li>\n
- Transition to circular economy<\/li>\n
- Pollution prevention and control<\/li>\n
- Protection and restoration of biodiversity and ecosystems<\/li>\n<\/ul>\n
This principle is essentially the embodiment of the \u201egreen oath\u201c of the European Green Deal. Its importance was fully demonstrated in the Recovery and Resilience Plans, which were the first massive test of this interconnected system in practice. Every single measure in all Member States\u2019 plans had to undergo a rigorous DNSH assessment, forcing ministries across the EU to learn this new financial language.<\/p>\n
3. The multi-billion dollar \u201enudge\u201c: How climate targets shape every policy<\/h3>\n
While the DNSH principle acts as a \u201egreen brake\u201c, the EU also has an extremely powerful \u201egreen gas\u201c: targeted climate spending. The Union has committed to at least 30 % from its budget for 2021-2027<\/b> and from the NextGenerationEU instrument will be directed towards climate objectives. Under the Recovery and Resilience Plans, this objective is even at least 37 %<\/b>, with the total estimate across all plans reaching approximately 42 %<\/b>.<\/p>\n
How is this controlled? The answer is a mechanism called \u201e"climate tracking"<\/b>. Different types of activities are assigned coefficients (0 %, 40 % or 100 %) depending on how they contribute to climate goals. An investment in a wind farm will receive 100 %, while other projects may have a lower contribution.<\/p>\n
This is not just an accounting exercise. It is not a direct order, but the creation of a strong incentive. If a ministry of agriculture or transport wants to get maximum EU funding, it must design its projects to meet climate criteria. This makes climate policy part of the DNA of every European policy, and the entire budget is thus gently but strongly \u201enudged\u201c towards greener outcomes.<\/p>\n
4. The Other Side of the Coin: The Hunt for Environmentally Harmful Subsidies<\/h3>\n
If tracking climate spending is about redirecting money to the right places, an equally important task is to stop it from flowing to the wrong ones. Greening finance has two sides: supporting good investments and eliminating harmful ones.<\/p>\n
The EU has therefore established a formal process under which Member States must identify, report and phase out environmentally harmful subsidies (EHS)<\/b>, with a particular focus on fossil fuel subsidies. The work is so detailed that it is divided into two streams: one for energy subsidies and the other for everything else.<\/p>\n
This is not just an internal EU agenda. This effort is in line with international commitments such as the Kunming and Montreal Global Biodiversity Frameworks and requires regular reporting to the UN. This sends a clear message to businesses and investors: the future belongs to technologies that do not need planet-damaging subsidies.<\/p>\n
5. From Brussels to Bratislava: Why there is no one universal "green" manual<\/h3>\n
The idea that EU policy is just a set of commands that member states must slavishly follow is wrong. It is in the area of green finance that we see that the implementation of European frameworks requires significant adaptation at the national level.<\/p>\n
Examples from different countries show this diversity in practice:<\/p>\n
\n- Spain:<\/b> It has linked its national methodology for "green labeling" budget items to the UN Sustainable Development Goals (SDGs).<\/li>\n
- France:<\/b> It uses its national methodology to screen projects under the massive investment plan \u201eFrance 2030.\u201c As a result, the share of credits with a positive environmental impact in the 2025 plan has increased to 49 % from 39 % in 2024.<\/li>\n
- Austria:<\/b> It is actively working to align its national green budgeting methodology with the EU taxonomy and criteria for issuing its own green bonds.<\/li>\n<\/ul>\n
This flexibility is both a strength and a weakness. It enables national innovation, but it also places a huge burden on national administrations to build up the expertise and be able to translate European frameworks into effective local solutions.<\/p>\n
A complex machine for a simple goal<\/h3>\n
The European Union is building an incredibly detailed and interconnected financial architecture to achieve one seemingly simple goal: a sustainable future. It is a system whose gears and levers \u2013 from the DNSH principle to climate coefficients to the hunt for harmful subsidies \u2013 are designed to fundamentally change the flow of public and private money.<\/p>\n
As Europe continues to fine-tune this complex machine, a key question remains: Can this complex system be kept efficient and agile enough to deliver the rapid and real change our planet needs, or will its own complexity become its greatest obstacle? JRi<\/strong><\/em><\/p>","protected":false},"excerpt":{"rendered":"We hear everywhere about \u201egreen finance\u201c, \u201esustainable investment\u201c and the ambitious \u201eEuropean Green Deal\u201c. These terms have become part of our everyday conversation, but they often remain just vague slogans. But what is really behind them?<\/p>","protected":false},"author":7,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[4,27],"tags":[],"class_list":["post-38179","post","type-post","status-publish","format-standard","hentry","category-klimaticka-zmena","category-udrzatelnost_uhlikova-neutralita"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/posts\/38179","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/comments?post=38179"}],"version-history":[{"count":0,"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/posts\/38179\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/media?parent=38179"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/categories?post=38179"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.co2news.sk\/en\/wp-json\/wp\/v2\/tags?post=38179"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}