Chinese state-owned enterprises (SOEs) have been investing in coal plants, heavy industries in Southeast Europe at a time when Chinese President Xi Jingping promised during a recent speech to the UN Assembly that China will aim to hit peak emissions before 2030 and for carbon neutrality by 2060.

“The EU needs to insist on a halt to coal projects in the EU and accession countries being agreed in the comprehensive investment on trade (CAI) it is currently negotiating with China, Pippa Gallop, Southeast Europe Energy Advisor at Bankwatch, told New Europe on September 29, stressing that compliance with EU law must also be a binding condition for any infrastructure project.

“The EU also needs to improve law enforcement in accession countries, including by strengthening the Energy Community Treaty to enable effective, proportionate and dissuasive penalties to be issued. Introducing a carbon border tax for electricity would also help get the message across that coal is no longer economic,” Gallop said.

The Chinese government has sought a leadership role in the UN’s agencies’ efforts to address climate emergency challenges, but it has not yet demonstrated the requisite respect for underlying principles and norms that underpin the work of the UN.

“The double talk by Xi underlines how China continues to ignore the carbon bomb its industry is creating overseas through the construction of new coal-fired power stations, Wawa Wang, senior advisor at a Danish environmental and development NGO VedvarendeEnergi, told New Europe on September 29.

“The absence of EU’s punitive measures for breaches of EU standards is inviting Chinese companies to leverage loans for the benefit of Chinese EPC contractors in the already fragmented regulatory environments in the EU’s own backyard. Solving climate change cannot happen without cooperation with China, says EU. Words should matter,” she said.

In keeping with European Commission President Ursula von der Leyen’s recent message that the Western Balkans are at the heart of Europe and not a stopover on the Silk Road, the EU should ensure that the Economic and Investment Plan for the Western Balkans reflects the shared green path to recovery and climate neutrality, Viktor Berishaj, energy policy Coordinator for Southeast Europe at Climate Action Network (CAN) Europe told New Europe.

“The region needs strengthening of the right investment tools, frameworks and players helping it in greening its economies. This is how it will move away from coal projects and towards green energy transition.

Chinese investments disregard the environment, both natural as well as regulatory by breaching legal obligations in these countries. Thus, the EU should also strengthen the Energy Community Treaty and the EU accession process for the region with more effective enforcement mechanisms,” Berishaj said.

Chinese SOEs have been particularly active in southeast Europe in recent years. Contracts have been signed to build four new coal plants, rehabilitate two coal plants, invest in heavy industries and build other infrastructures such as motorways and railways, Bankwatch said in a press release on September 14, adding that at least three more memoranda for new coal plants have been signed.

“By approving its companies to undertake coal projects in Europe, China fails to deliver its pledge to combat climate change in an understanding reached with the EU at the 20th EU-China Summit,” Bankwatch said.

The need to limit climate change clearly means that no more fossil fuel infrastructure can be built anywhere, Zvezdan Kalmar from CEKOR, Serbia, was quoted as saying in the press release, warning, “Southeast European governments bear the primary responsibility for poor decision-making and enforcement on Chinese-built projects, but they will ultimately create problems for the whole EU as the accession countries struggle to comply with EU law”.

Author: Kostis Geropoulos, Energy & Russian Affairs Editor of New Europe Newspaper.