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2040 climate target

The EU’s Climate Policy Is Entering a New Era: What the 2040 Target Changes

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The European Union now has a legally binding target to cut net greenhouse-gas emissions by 90% by 2040, compared with 1990. The amended European Climate Law allows up to 5 percentage points of that reduction to come from international carbon credits, so at least 85% must be achieved domestically. The target marks a new phase in EU climate policy, but it does not settle the detailed rules for the years after 2030: those still need to be proposed.

What is the EU’s 2040 climate target?

The amended European Climate Law sets a binding goal of reducing the EU’s net greenhouse-gas emissions by 90% in 2040 relative to 1990. Under the design described by the European Commission and Council, at least 85% of the reduction must come from domestic action; international credits can account for up to 5 percentage points. It is therefore inaccurate to describe the target as requiring a 90% domestic cut.

“Net” emissions account for emissions and removals, including carbon absorbed by land and other qualifying removals. The Council’s summary also says the framework provides for EU-based permanent carbon removals to address residual emissions that are hard to eliminate under the Emissions Trading System. The exact accounting and rules for these mechanisms will depend in part on future legislation.

How does the 2040 target fit with the EU’s other climate goals?

Milestone Target Status
2030 At least 55% net greenhouse-gas emissions reduction from 1990 Binding EU target
2040 90% net reduction from 1990, with at least 85% domestic reductions and up to 5% from international credits Binding under the amended European Climate Law
2050 Climate neutrality Binding objective under the European Climate Law

The European Climate Law entered into force in 2021 and made the 2030 objective and 2050 climate-neutrality goal legally binding. The EU’s Fit for 55 package revised policy instruments to support the 2030 target. The Commission recommended a 2040 goal in 2024, proposed the 90% target in July 2025, and Parliament and Council reached a provisional agreement in December 2025. The Council formally adopted the amendment on 5 March 2026; the Commission says it entered into force in April 2026.

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Is the EU on track to meet its 2030 target?

The European Commission reports that EU net greenhouse-gas emissions fell 2.5% in 2024 compared with 2023. Since 1990, emissions have fallen by more than 37%—or 39% when international aviation and shipping are excluded—while the EU economy grew 71%. These figures show substantial progress, but they do not guarantee that future targets will be met.

The Commission says the EU is on track for its 2030 target only if existing and planned measures are fully implemented by the EU and Member States and investment flows remain strong. Its progress reporting says average reductions of 140 million tonnes of CO2-equivalent per year are needed through 2030. That is a demanding pace, not a forecast that the reductions will happen automatically.

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Which sectors face the biggest delivery challenges?

Progress is uneven across the economy. The Commission’s 2025 staff report says annual reductions need to accelerate significantly in transport and buildings. Member State projections fall short of expected contributions for buildings; for transport and industry, they fall short when only existing measures are counted. The report also flags slower emissions reductions in agriculture. Separately, the Commission’s Climate Law assessment describes a deteriorating trend in the land-use, land-use change and forestry carbon sink, which absorbs emissions.

These findings point to distinct problems: cutting emissions more quickly in transport and buildings, strengthening planned action in several sectors, and protecting the capacity of land to remove carbon. An economy-wide target does not mean every sector is on the same trajectory or can contribute in the same way.

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What changes in the EU’s approach beyond the size of the target?

The 2040 law makes competitiveness, simplification, social fairness, energy security and affordability explicit considerations for the Commission’s future proposals. The shift is not a retreat from the climate target; it is a clearer statement that climate measures will be designed alongside concerns about industrial performance, household costs and reliable energy.

The EU’s wider climate-policy mix combines economy-wide targets and carbon pricing with sector-specific measures, efforts to strengthen natural carbon sinks, and support for citizens and businesses affected by the transition. The European Commission says Member States are to use emissions-trading revenue for climate and energy projects and the social dimension of the transition. For industry, its Green Deal overview emphasizes clean-technology markets, skills, funding and supply chains.

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Social support is part of that framework. The Commission’s Green Deal overview describes the Social Climate Fund as dedicating €65 billion from the EU budget and more than €86 billion in total to support vulnerable citizens and small businesses. Those are stated funding allocations, not a measure of how much has already reached recipients.

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What flexibility is built into the framework?

The amended law sets an overall destination while allowing some flexibility in how policy instruments and sectors contribute. Its design includes a limited role for international credits, EU-based permanent removals for residual hard-to-abate emissions under the ETS, and flexibility across sectors and instruments. The Council also says full operation of ETS2—the emissions trading system covering road transport, buildings and other covered sectors—moves from 2027 to 2028.

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These choices involve real policy trade-offs. A larger domestic share can strengthen the link between the EU’s target and reductions within its own economy; credits and removals can add flexibility for emissions that are difficult to eliminate. Faster decarbonisation can support the climate goal, while the pace and cost of change matter to businesses, households and energy security. The law’s design identifies these tensions; by itself, it does not prove how well the resulting policies will work.

What is still undecided?

The 2040 target is enacted, but it is not a complete post-2030 climate programme. The Commission is to prepare further legislative proposals, and the specific sector-by-sector measures for the period after 2030 remain to be set. The amended law tells the Commission to take considerations such as competitiveness, affordability and fairness into account, but it does not make every future policy choice in advance.

For that reason, the new era is best understood as a firmer long-term legal target paired with a more explicit political focus on how the transition is delivered. Whether the EU can meet the target will depend on the proposals that follow, their implementation by EU institutions and Member States, investment, and faster progress in sectors where current trajectories fall short.

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