The EU’s law to restore nature was given the green light by the European parliament this week.
The long-awaited “nature restoration” law aims to repair the EU’s damaged ecosystems over the next few decades.
The final vote on the law came amid farmer protests across the EU and, in response, rollbacks of some of the bloc’s other environmental plans.
The law became a focal point for misinformation in recent months and saw strong levels of opposition from different groups.
It passed through a final parliament vote on 27 February, with 329 votes in favour, 275 against and 24 abstentions – a larger margin of approval than a knife-edge vote last summer.
It now needs to be approved by the council of the EU before it can take effect.
In this Q&A, Carbon Brief explains the aims of the nature restoration law, the challenges it faced, its scientific backing and what it will mean for climate change and biodiversity loss in the EU.
- What is the EU nature restoration law?
- Will the law help the EU meet its climate and biodiversity goals?
- What is the scientific backing behind the law?
- What are the most contentious parts of the nature restoration law?
- What has been the reaction to the EU’s nature restoration law?
What is the EU nature restoration law?
Proposed in June 2022, the nature restoration law is seen by the European Commission as a key part of meeting the EU’s climate and biodiversity goals.
It aims to restore at least 20% of the EU’s land and sea areas by 2030.
Within this wider goal, countries need to restore 30% of habitats covered by the new law (including forests, rivers and wetlands) that are already degraded by 2030. This increases to 60% by 2040 and at least 90% by 2050.
Sabien Leemans, a senior biodiversity policy officer at WWF EU, says the law is a “very big opportunity” for nature – and a rare one in terms of EU policy. She tells Carbon Brief:
“It is comparable to the habitats directive that was adopted in the early 90s – more than 30 years ago. It’s not like in the climate sphere that you have legislation coming up every year or every couple of years.
“For nature, with a proposal that would really impact how we use land and sea in Europe, I think this is really historic and [it is] not happening even every decade.”
The law is intended to work alongside other environmental policies on a range of issues, including birds, habitats, water and invasive alien species. Its goals also align with the new EU 2030 forest strategy, which intends to protect and restore forests across the bloc.
The law states that EU countries should, “as appropriate”, prioritise restoring habitats that are “not in good condition” and also located in Natura 2000 sites – an EU network of protected areas containing at-risk species and ecosystems – until 2030.
These areas are “essential” for nature conservation, the law says, and there is an existing EU obligation to ensure that Natura 2000 areas are covered by long-term restoration measures.
EU countries will need to submit national restoration plans to the commission to show how they plan to deliver on key targets, with requirements for monitoring and reporting on their progress towards those goals. Leemans tells Carbon Brief:
“The member states will choose where they will restore, what they will restore, how they will restore. And together the national restoration plans need to add up to the targets.”
More than 110,000 people and organisations responded to an online public consultation on the proposal in early 2021. The results showed “overwhelming support” for legally binding targets, with 97% of respondents in favour of general EU restoration targets across all ecosystems, the commission said.
The law scraped through a parliament vote in July 2023, which saw elements of the text “watered down”. (See: What are the most contentious parts of the nature restoration law?)
After further negotiations, the commission, parliament and council of the EU provisionally agreed the terms of the new law in November 2023. This passed through the final parliament vote on 27 February 2024.
There was a “last-ditch attempt from rightwing parties” to reject the law in this vote, the Guardian reported. The centre-right European People’s Party (EPP), the largest political group in the parliament, voted against the law alongside “far-right lawmakers”, the newspaper said.
Civil society organisations such as the European Environmental Bureau and Friends of the Earth Europe celebrated the EU parliament passed the law “despite EPP & far-right’s attempts to block the text”.
Politico noted that the proposal’s “narrow survival underscored broader trends likely to hamper green lawmaking” after the upcoming European parliament elections in June.
The law still has to be adopted by the council of the EU before it can take effect. This is usually a formality, but Deutsche Welle reported that “it is not guaranteed and some recent EU policies have faced blockages and delays because of domestic pushback”.
The parliament’s lead negotiator on the proposal, César Luena, said the EU can now “move from protecting and conserving nature to restoring it”.
Will the law help the EU meet its climate and biodiversity goals?
The commission’s original proposal for the law said that “more decisive action” is needed to achieve the EU’s climate and biodiversity goals, adding that the bloc “has so far failed to halt the loss of biodiversity”. It said:
“The outlook for biodiversity and ecosystems is bleak and shows that the current approach is not working.”
Global and national targets are in place around the world to tackle climate change and biodiversity loss. But, currently, greenhouse gas emissions are still rising and biodiversity is declining at a level described by the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) as “unprecedented”.
Despite the fact that many elements have been weakened since the first proposal, the law is intended to be one part of several solutions needed to bridge this gap between goals and action. Leemans tells Carbon Brief:
“It’s quite clear from all reports that we are still losing nature. More than 80% of the natural habitats in Europe that are listed on the habitats directive are not in a good condition. So there is really a lot of work to do.
“It’s really important to protect nature…But it’s not enough – you also need to start restoring nature where it has been lost and bring it back.”
The EU’s 2030 biodiversity strategy sets out the bloc’s plans to protect nature and improve ecosystems.
Healthier ecosystems would have a range of wider benefits, including being more resilient to climate change, reducing the impact of extreme weather and helping to mitigate greenhouse gas emissions. Currently, 26% of the EU’s land and 12% of marine areas are protected.
Romina Pourmokhtari, the Swedish climate and environment minister, says the nature restoration law will hopefully help the EU “rebuild a healthy level of biodiversity, fight climate change and meet our international commitments under the Kunming-Montreal agreement”.
The Kunming-Montreal Global Biodiversity Framework (GBF) is a set of goals and targets aiming to “halt and reverse” biodiversity loss by the end of this decade. It includes a target to conserve 30% of the world’s land and 30% of the ocean by 2030. (See Carbon Brief’s recent Q&A on progress one year since the framework was agreed.)
The map below, taken from a 2023 study, shows the existing European network of protected areas under strict protection (light blue), not-strict protection (yellow) and new protected area corridors (dark blue). EU countries are shown in dark grey. The level of the protection is based on categories from the International Union for Conservation of Nature (IUCN). The areas under the strictest protection have minimal presence of humans.
According to an impact assessment study published by the commission earlier this year, the economic benefits of restoring a number of different EU ecosystems – including peatlands, forests and lakes – by 2050 range at around €1.86tn, compared to the estimated €154bn cost of these actions.
The report added that, in a number of ways, the “climate mitigation benefits alone outweighed the cost of restoration action required”.
What is the scientific backing behind the law?
The scientific rationale for the EU’s nature restoration law is laid out in the commission’s impact assessment study, which considers both ecosystem restoration needs and the financing needed to implement such targets in the EU.
About 80% of habitats in the EU have “bad” or “poor” conservation status, and only 15% are in “good” condition, according to the European Environment Agency’s (EEA) 2020 “state of nature in the EU” report.
More than half of peatlands – including bogs, mires and fens – and half of dune habitats are in bad condition, the report says. Coastal habitats have the smallest area remaining in good condition.
The chart below, taken from the report, shows the percentage of habitat in good (green), unknown (grey), poor (yellow) and bad (red) condition.
As a result of the degradation of habitats, many species across the EU are in decline.
For example, pollinators are crucial for food production, but one in three bee and butterfly species are in decline, according to the council. It points out that €5bn of the EU’s annual agricultural output “can be directly attributed” to those species, but about half of the areas where pollinator-dependent crops are grown “do not provide suitable conditions for pollinators”.
The EEA assessment provides a map of the conservation status in the EU habitats, shown below. Regions in red have “bad” conservation status, regions in yellow are classified as “poor” conservation status and green areas have a “good” conservation status.
During a webinar hosted by the European Geosciences Union at the end of last year, Damien Thomson, a political advisor working within the European parliament, said the law is “largely scientifically based, but there’s room for improvement”.
In the webinar, Thomson emphasised that the commission considered the scientific merit of the legislation, but said that the scientific evidence did not hold equal weight to the political voices in the parliament.
The EU set its first nature restoration target in 2010, as part of the EU biodiversity strategy to 2020. That strategy contained a target aimed to restore “at least 15% of degraded ecosystems” by 2020.
However, the bloc did not achieve any of the six targets set out in that strategy, the impact assessment found. It stated that the restoration target was hindered by several issues, such as the lack of legally binding targets and the “ambiguity” as to which ecosystems and restoration activities it was referring to.
The new restoration law stems from the EU biodiversity strategy for 2030, which aims to establish legally binding targets to restore “significant areas of degraded and carbon-rich ecosystems by 2030”.
The strategy aims to legally protect a minimum of 30% of the land, including inland waters, and 30% of the sea in the EU by 2030. It additionally set a target to ensure that 30% of EU species and habitats reach “a favourable conservation status” and to restore at least 25,000 kilometres of free-flowing rivers by that date.
It adds that the commission and the EEA will guide countries to “select and prioritise the species and habitats for restoration measures”.
The restoration law also acknowledges that the GBF requires that at least 30% of degraded ecosystems worldwide – including terrestrial, inland water and marine and coastal ecosystems – should be “under effective restoration” by 2030.
However, the law ultimately required restoration of 20% of the EU’s lands and seas by 2030.
In a joint statement after the final vote, BirdLife Europe, ClientEarth, the European Environmental Bureau and WWF EU said they were “relieved that MEPs listened to facts and science, and did not give in to populism and fear-mongering”. The statement added:
“Now, we urge member states to follow suit and deliver this much-needed law to bring back nature in Europe.”
What are the most contentious parts of the nature restoration law?
One of the main objections against the new law was around restoration requirements for drained peatlands used for agriculture and came from political and farming groups.
Specifically, member states are required to establish measures to restore organic soil in 30% of agricultural lands lying in drained peatlands by 2030.
This can be achieved by a range of actions, which include converting cropland to permanent grassland, establishing peat-forming vegetation or fully rewetting drained peatlands to allow padiculture – sowing of crops on peatlands or on rewetted peats.
The initial proposal was intended to reach 50% of such areas by 2040 and 70% by 2050; however, the final regulation slashed those percentages to 40% and 50%, respectively.
This target faced political resistance from conservative parties, who argued that the law would threaten the livelihoods of farmers and fishers, decrease food production and push up prices. These groups raised a “relentless campaign to bring down the text”, Euronews reported.
The European People’s Party (EPP) also sought “to drastically reduce the scope of [the] plans for” peatland restoration and was “against the conversion of agricultural land for other uses”, including restoring peatlands, Deutsche Welle reported.
In response to these concerns, member states “added flexibility” to targets linked to the rewetting of peatlands and green urban spaces into their proposal, according to Euronews.
The outlet reported that Pourmokhtari, the Swedish minister, said the country’s presidency of the council had “listened carefully to all member states who had different concerns and remarks on the proposal”.
Another target that spurred strong political objection was the restoration of forest ecosystems.
The final law mandates member states to “achieve an increasing trend at national level of at least six out of seven” forest indicators, which include traits such as the amount of non-living woody biomass in standing and lying deadwood, organic carbon stocks, forest connectivity and tree species diversity.
By June 2031, EU countries need to inform the commission about their progress on restoring nature between when the law takes effect and 2030.
After this, countries need to report progress at least every six years. The first draft of the law had proposed assessments every three years.
Countries also must, by June 2028, report other information to the commission, including details around which areas will be restored.
The law says that when considering forest and other ecosystem restoration actions, countries “shall aim to contribute” to the EU’s existing goal to plant at least 3bn trees across the bloc by 2030, prioritising native tree species and adapted species.
Nordic countries “had previously pushed back against previous forestry-related targets” and were expected to oppose the nature restoration law, a parliamentary representative told Euractiv.
Sweden, for example, was “believed to be opposed” to the targets of forest management contained in the law, Euronews reported.
Opposition parties accused Finland’s government of a “failure to protect national interests” and pointed out that the law would be costly, the Helsinki Times reported in November. Riikka Purra, chairperson of the right-wing populist Finns Party, said:
“We won’t stand by pillaging Finnish forests a lot, but also not for pillaging them a bit less.”
In response, Finland’s prime minister, Sanna Marin, said her country would accept the proposal if it included amendments and met “Finland’s overall interests”, the outlet said. It added that the government was pushing for the restoration measures to be “voluntary for land owners”, since forest policy “falls strictly” within national policy.
Following negotiations by the EU parliament, commission and council last year, a statement from WWF said the law had been “watered down”, with “disappointing” exemptions and “excessive flexibility” on some requirements.
Despite this, Leemans believes the law will lead to improvements for European ecosystems. But, she adds:
“The key will be the implementation.”
What has been the reaction to the EU’s nature restoration law?
Since the law was first proposed in 2022, it has received support from a range of groups, including wind energy and solar power associations, hundreds of scientists, dozens of major companies, an EU organic farming representative group and NGOs such as WWF, BirdLife International and Greenpeace.
The International Union for Conservation of Nature called on the EU to adopt the law and Wetlands International Europe, a non-governmental group of wetland preservation organisations, said the law will help to “secure the future of our vital wetlands”.
Swedish campaigner Greta Thunberg was among a group of climate activists calling for a strong nature restoration law outside the European parliament building in Strasbourg last July.
There were two key opponents to the proposed law – the major agricultural lobby group Copa-Cogeca and the EPP.
The EPP made a number of debunked remarks about the law, including that it would “turn the entire city of Rovaniemi” – the alleged “hometown” of Santa Claus – into a forest.
The party also claimed that the targets will lead to a “global famine” alongside higher food prices and increased imports of “unsafe food that does not meet EU standards”. These claims have been rebutted by a number of experts.
An open letter signed by 3,000 scientists in June last year pushed back on claims that the law will harm farmers and threaten food security. The letter says that these kinds of claims “not only lack scientific evidence, but even contradict it”, Reuters reported.
“Green-minded” lawmakers, scientists and environmental groups said the EPP was opposing nature and climate policies to “score political points in rural constituencies” in the upcoming parliament elections, Politico reported last November.
In a correspondence to the scientific journal Nature, Dr Kris Decleer, a researcher at Belgium’s Research Institute for Nature and Forest, and Prof An Cliquet, a researcher at Ghent University, wrote that opponents to the law were “influenced by lobbyists in favour of intensive agriculture, fisheries and the forestry industry, who say that the law would cut jobs and undermine food and energy security”.
Many farmers will be directly impacted by the nature restoration law and it featured among the concerns of farmers protesting across the EU in recent months (see Carbon Brief’s analysis of how these protests relate to climate change).
The commission’s impact assessment for the law said that the farming, forestry and fishery sectors are likely to be most impacted through, for example, lost income from less intensive extractive management in forestry. However, it also said that these sectors stand to benefit in the long-term, as they will be more resilient to extreme weather and reduce the risks of pest outbreaks as a result.
There are also farm-related exemptions in the law, including an option to halt certain targets for agricultural ecosystems in case of any “unforeseeable and exceptional events outside of the EU’s control and with severe EU-wide consequences for food security”. This was added to the text in November last year. (See: What are the most contentious parts of the nature restoration law?)
The law includes further leeway for countries to potentially set lower restoration targets for certain ecosystems in specific circumstances.
Leemans, from WWF EU, tells Carbon Brief that criticisms from the EPP and others were “mainly misinformation, and really on an unprecedented scale”. She says:
“We’ve never seen such an aggressive campaign against a legal proposal coming from the commission. It was really putting the [EU] Green Deal in jeopardy because the nature restoration law is the biodiversity pillar of the Green Deal, and it’s really a very important piece of the puzzle.”
She adds that while the EPP may claim it is “protecting or defending the farmers’ concerns”, she believes “they are doing the opposite”. She says:
“All science tells you the same – it’s healthy ecosystems that need to be in place to ensure food security. Agriculture needs healthy soils, needs water retention, needs flooding and drought prevention, pollination and all this depends on healthy ecosystems.
“It’s very cynical to tell people that you’re defending farmers and actually blocking one of the solutions for farmers.”
The post Q&A: What does the EU ‘nature restoration’ law mean for climate and biodiversity? appeared first on Carbon Brief.
Q&A: What does the EU ‘nature restoration’ law mean for climate and biodiversity?
In 2026, the dangers of fossil fuel dependence have been laid bare like never before. The illegal invasion of Iran has brought pain and destruction to millions across the Middle East and triggered a global energy crisis impacting us all. Communities in the Pacific have been hit especially hard by rising fuel prices, and Australians have seen their cost-of-living woes deepen.
Such moments of crisis and upheaval can lead to positive transformation. But only when leaders act with courage and foresight.
There is no clearer statement of a government’s plans and priorities for the nation than its budget — how it plans to raise money, and what services, communities, and industries it will invest in.
As we count down the days to the 2026-27 Federal Budget, will the Albanese Government deliver a budget for our times? One that starts breaking the shackles of fossil fuels, accelerates the shift to clean energy, protects nature, and sees us work together with other countries towards a safer future for all? Or one that doubles down on coal and gas, locks in more climate chaos, and keeps us beholden to the whims of tyrants and billionaires.
Here’s what we think the moment demands, and what we’ll be looking out for when Treasurer Jim Chalmers steps up to the dispatch box on 12 May.
1. Stop fuelling the fire
2. Make big polluters pay
3. Support everyone to be part of the solution
4. Build the industries of the future
5. Build community resilience
6. Be a better neighbour
7. Protect nature
1. Stop fuelling the fire
In mid-April, Pacific governments and civil society met to redouble their efforts towards a Fossil Fuel Free Pacific. Moving beyond coal, oil and gas is fundamental to limiting warming to 1.5°C — a survival line for vulnerable communities and ecosystems. And as our Head of Pacific, Shiva Gounden, explained, it is “also a path of liberation that frees us from expensive, extractive and polluting fossil fuel imports and uplifts our communities”.
Pacific countries are at the forefront of growing global momentum towards a just transition away from fossil fuels, and it is way past time for Australia to get with the program. It is no longer a question of whether fossil fuel extraction will end, but whether that end will be appropriately managed and see communities supported through the transition, or whether it will be chaotic and disruptive.
So will this budget support the transition away from fossil fuels, or will it continue to prop up coal and gas?
When it comes to sensible moves the government can make right now, one stands out as a genuine low hanging fruit. Mining companies get a full rebate of the excise (or tax) that the rest of us pay on diesel fuel. This lowers their operating costs and acts as a large, ongoing subsidy on fossil fuel production — to the tune of $11 billion a year!
Greenpeace has long called for coal and gas companies to be removed from this outdated scheme, and for the billions in savings to be used to support the clean energy transition and to assist communities with adapting to the impacts of climate change. Will we see the government finally make this long overdue change, or will it once again cave to the fossil fuel lobby?
2. Make big polluters pay
While our communities continue to suffer the escalating costs of climate-fuelled disasters, our Government continues to support a massive expansion of Australia’s export gas industry. Gas is a dangerous fossil fuel, with every tonne of Australian gas adding to the global heating that endangers us all.
Moreover, companies like Santos and Woodside pay very little tax for the privilege of digging up and selling Australians’ natural endowment of fossil gas. Remarkably, the Government currently raises more tax from beer than from the Petroleum Resource Rent Tax (PRRT) — the main tax on gas profits.
Momentum has been building to replace or supplement the PRRT with a 25% tax on gas exports. This could raise up to $17 billion a year — funds that, like savings from removing the diesel tax rebate for coal and gas companies, could be spent on supporting the clean energy transition and assisting communities with adapting to worsening fires, floods, heatwaves and other impacts of climate change.
As politicians arrive in Canberra for budget week, they will be confronted by billboards calling for a fair tax on gas exports. The push now has the support of dozens of organisations and a growing number of politicians. Let’s hope the Treasurer seizes this rare window for reform.
3. Support everyone to be part of the solution
As the price of petrol and diesel rises, electric vehicles (EVs) are helping people cut fuel use and save money. However, while EV sales have jumped since the invasion of Iran sent fuel prices rising, they still only make up a fraction of total new car sales. This budget should help more Australians switch to electric vehicles and, even more importantly, enable more Australians to get around by bike, on foot, and on public transport. This means maintaining the EV discount, investing in public and active transport, and removing tax breaks for fuel-hungry utes and vans.
Millions of Australians already enjoy the cost-saving benefits of rooftop solar, batteries, and getting off gas. This budget should enable more households, and in particular those on lower incomes, to access these benefits. This means maintaining the Cheaper Home Batteries Program, and building on the Household Energy Upgrades Fund.
4. Build the industries of the future
If we’re to transition away from fossil fuels, we need to be building the clean industries of the future.
No state is more pivotal to Australia’s energy and industrial transformation than Western Australia. The state has unrivaled potential for renewable energy development and for replacing fossil fuel exports with clean exports like green iron. Such industries offer Western Australia the promise of a vibrant economic future, and for Australia to play an outsized positive role in the world’s efforts to reduce emissions.
However, realising this potential will require focussed support from the Federal Government. Among other measures, Greenpeace has recommended establishing the Australasian Green Iron Corporation as a joint venture between the Australian and Western Australian governments, a key trading partner, a major iron ore miner and steel makers. This would unite these central players around the complex task of building a large-scale green iron industry, and unleash Western Australia’s potential as a green industrial powerhouse.
5. Build community resilience
Believe it or not, our Government continues to spend far more on subsidising fossil fuel production — and on clearing up after climate-fuelled disasters — than it does on helping communities and industries reduce disaster costs through practical, proven methods for building their resilience.
Last year, the Government estimated that the cost of recovery from disasters like the devastating 2022 east coast floods on 2019-20 fires will rise to $13.5 billion. For contrast, the Government’s Disaster Ready Fund – the main national source of funding for disaster resilience – invests just $200 million a year in grants to support disaster preparedness and resilience building. This is despite the Government’s own National Emergency Management Agency (NEMA) estimating that for every dollar spent on disaster risk reduction, there is a $9.60 return on investment.
By redirecting funds currently spent on subsidising fossil fuel production, the Government can both stop incentivising climate destruction in the first place, and ensure that Australian communities and industries are better protected from worsening climate extremes.
No communities have more to lose from climate damage, or carry more knowledge of practical solutions, than Aboriginal and Torres Strait Islander peoples. The budget should include a dedicated First Nations climate adaptation fund, ensuring First Nations communities can develop solutions on their own terms, and access the support they need with adapting to extreme heat, coastal erosion and other escalating challenges.
6. Be a better neighbour
The global response to climate change depends on the adequate flow of support from developed economies like Australia to lower income nations with shifting to clean energy, adapting to the impacts of climate change, and addressing loss and damage.
Such support is vital to building trust and cooperation, reducing global emissions, and supporting regional and global security by enabling countries to transition away from fossil fuels and build greater resilience.
Despite its central leadership role in this year’s global climate negotiations, our Government is yet to announce its contribution to international climate finance for 2025-2030. Greenpeace recommends a commitment of $11 billion for this five year period, which is aligned with the global goal under the Paris Agreement to triple international climate finance from current levels.
This new commitment should include additional funding to address loss and damage from climate change and a substantial contribution to the Pacific Resilience Facility, ensuring support is accessible to countries and communities that need it most. It should also see Australia get firmly behind the vision of a Fossil Fuel Free Pacific.
7. Protect nature
There is no safe planet without protection of the ecosystems and biodiversity that sustain us and regulate our climate.
Last year the Parliament passed important and long overdue reforms to our national environment laws to ensure better protection for our forests and other critical ecosystems. However, the Government will need to provide sufficient funding to ensure the effective implementation of these reforms.
Greenpeace has recommended $500 million over four years to establish the National Environment Agency — the body responsible for enforcing and monitoring the new laws — and a further $50 million to Environment Information Australia for providing critical information and tools.
Further resourcing will also be required to fulfil the crucial goal of fully protecting 30% of Australian land and seas by 2030. This should include $1 billion towards ending deforestation by enabling farmers and loggers to retool away from destructive practices, $2 billion a year for restoring degraded lands, $5 billion for purchasing and creating new protected areas, and $200 million for expanding domestic and international marine protected areas.
Conclusion
This is not the first time that conflict overseas has triggered an energy crisis, or that a budget has been preceded by a summer of extreme weather disasters, highlighting the urgent need to phase out fossil fuels. What’s different in 2026 is the availability of solutions. Renewable energy is now cheaper and more accessible than ever before. Global momentum is firmly behind the transition away from fossil fuels. The Albanese Government, with its overwhelming majority, has the chance to set our nation up for the future, or keep us stranded in the past. Let’s hope it makes some smart choices.
The 2026 budget test: Will Australia break free from fossil fuels?
Anne Jellema is Executive Director of 350.org.
The war on Iran and Lebanon is a deeply unjust and devastating conflict, killing civilians at home, destroying lives, and at the same time sending shockwaves through the global economy. We, at 350.org, have calculated, drawing on price forecasts from the International Monetary Fund (IMF) and Goldman Sachs, just how much that volatility is costing us.
Even under the IMF’s baseline scenario – a de facto “best case” scenario with a near-term end to the war and related supply chain disruptions – oil and gas price spikes are projected to cost households and businesses globally more than $600 billion by the end of the year. Under the IMF’s “adverse scenario”, with prolonged conflict and sustained price pressures, we estimate those additional costs could exceed $1 trillion, even after accounting for reduced demand.
Which is why we urgently need a power shift. Governments are under growing pressure to respond to rising fuel and food costs and deepening energy poverty. And it’s becoming clearer to both voters and elected officials that fossil dependence is not only expensive and risky, but unnecessary.
People who can are voting with their wallets: sales of solar panels and electric vehicles are increasing sharply in many countries. But the working people who have nothing to spare, ironically, are the ones stuck with using oil and gas that is either exorbitantly expensive or simply impossible to get.
Drain on households and economies
In India, street food vendors can’t get cooking gas and in the Philippines, fishermen can’t afford to take their boats to sea. A quarter of British people say that rising energy tariffs will leave them completely unable to pay their bills. This is the moment for a global push to bring abundant and affordable clean energy to all.
In April, we released Out of Pocket, our new research report on how fossil fuels are draining households and economies. We were surprised by the scale of what we found. For decades, governments have reassured people that energy price spikes are unfortunate but unavoidable – the result of distant conflicts, market forces or geopolitical shocks beyond anyone’s control. But the numbers tell a different story.
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Santa Marta: Ministers grapple with practicalities of fossil fuel phase-out
Around 60 governments that want to make progress on transitioning away from coal, oil and gas are meeting in Colombia to work out how they can do it an equitable way -
Why the transition beyond fossil fuels depends on cities and collective action
Cities will help identify concrete pathways for an equitable shift to clean energy at the Santa Marta conference, with C40 members aiming to halve their fossil fuel use by 2030
What we are living through today is not an energy crisis. It is a fossil fuel crisis. In just the first 50 days of the Middle East conflict, soaring oil and gas prices have siphoned an estimated $158 billion–$166 billion from households and businesses worldwide. That is money extracted directly from people’s pockets and transferred, almost instantly, into fossil fuel company balance sheets. And this figure only captures the immediate impact of price spikes, not the permanent economic drain of fossil dependence. Fossil fuels don’t just cost us once, they cost us over and over again.
First, through our bills. Every time there is a war, an embargo or a supply disruption, fossil fuel prices surge. For ordinary people, this means higher costs for energy, transport and food. Many Global South countries have little or no fiscal space to buffer the shock; instead, workers and families pay the price.
Second, through our taxes. Governments around the world continue to pour vast sums of public money into fossil fuel subsidies. These are often justified as a way to protect the most vulnerable at the petrol pump or in their homes. But in reality, the benefits are overwhelmingly captured by wealthier households and corporations. The poorest 20% receive just a fraction of this support, while public finances are drained.
Third, through climate impacts. New research across more than 24,000 global locations gives a granular account of the true costs of extreme heat, sea level rise and falling agricultural yields. Using this data to update IMF modelling of the social cost of carbon, we found that fossil fuel impacts on health and livelihoods amount to over $9 trillion a year. This is the biggest subsidy of all, because these massive and mounting costs are not charged to Big Oil – they are paid for by governments and households, with the poorest shouldering the lion’s share.
Massive transfer of wealth to fossil fuel industry
Adding up direct subsidies, tax breaks and the unpaid bill for climate damages, the total transfer of wealth from the public to the fossil fuel industry amounts to $12 trillion even in a “normal” year without a global oil shock. That’s more than 50% higher than the IMF has previously estimated, and equivalent to a staggering $23 million a minute.
The fossil fuel industry has become extraordinarily adept at profiting from instability. When conflict drives up prices, companies do not lose, they gain. In the current crisis, oil producers and commodity traders are on track to secure tens of billions of dollars in additional windfall profits, even as households face rising bills and governments struggle to manage the fallout.
Fossil fuel crisis offers chance to speed up energy transition, ministers say
This growing disconnect is impossible to ignore. Investors are advised to buy into fossil fuel firms precisely because of their ability to generate profits in times of crisis. Meanwhile, ordinary people are told to tighten their belts.
In 2026, unlike during the oil shocks of the 1970s, clean energy is no longer a distant alternative. Now, even more than when gas prices spiked due to Russia’s invasion of Ukraine in 2022, renewables are often the cheapest option available. Solar and wind can be deployed quickly, at scale, and without the volatility that defines fossil fuel markets.
How to transition from dirty to clean energy
The solutions are clear. Governments must implement permanent windfall taxes on fossil fuel companies to ensure that extraordinary profits generated during crises are redirected to support households. These revenues can be used to reduce energy bills, invest in public services, and accelerate the rollout of clean energy.
Second, we must shift subsidies away from fossil fuels and towards renewable solutions, particularly those that can be deployed quickly and equitably, such as rooftop and community solar. This is not just about cutting emissions. It is about building a more stable, fair and resilient energy system.
Finally, we need binding plans to phase out fossil fuels altogether, replacing them with homegrown renewable energy that can shield economies from future shocks. Because what the current crisis has made clear is this: as long as we remain dependent on fossil fuels, we remain vulnerable – to conflict, to price volatility and to the escalating impacts of climate change.
The true price of fossil fuels is no longer hidden. It is visible in rising bills, strained public finances and communities pushed to the brink. And it is being paid, every day, by ordinary people around the world.
It’s time for the great power shift.
Full details on the methodology used for this report are available here.
The Great Power Shift is a new campaign by 350.org global campaign to pressure governments to bring down energy bills for good by ending fossil fuel dependence and investing in clean, affordable energy for all
The post What fossil fuels really cost us in a world at war appeared first on Climate Home News.
Computer models that use artificial intelligence (AI) cannot forecast record-breaking weather as well as traditional climate models, according to a new study.
It is well established that AI climate models have surpassed traditional, physics-based climate models for some aspects of weather forecasting.
However, new research published in Science Advances finds that AI models still “underperform” in forecasting record-breaking extreme weather events.
The authors tested how well both AI and traditional weather models could simulate thousands of record-breaking hot, cold and windy events that were recorded in 2018 and 2020.
They find that AI models underestimate both the frequency and intensity of record-breaking events.
A study author tells Carbon Brief that the analysis is a “warning shot” against replacing traditional models with AI models for weather forecasting “too quickly”.
AI weather forecasts
Extreme weather events, such as floods, heatwaves and storms, drive hundreds of billions of dollars in damages every year through the destruction of cropland, impacts on infrastructure and the loss of human life.
Many governments have developed early warning systems to prepare the general public and mobilise disaster response teams for imminent extreme weather events. These systems have been shown to minimise damages and save lives.
For decades, scientists have used numerical weather prediction models to simulate the weather days, or weeks, in advance.
These models rely on a series of complex equations that reproduce processes in the atmosphere and ocean. The equations are rooted in fundamental laws of physics, based on decades of research by climate scientists. As a result, these models are referred to as “physics-based” models.
However, AI-based climate models are gaining popularity as an alternative for weather forecasting.
Instead of using physics, these models use a statistical approach. Scientists present AI models with a large batch of historical weather data, known as training data, which teaches the model to recognise patterns and make predictions.
To produce a new forecast, the AI model draws on this bank of knowledge and follows the patterns that it knows.
There are many advantages to AI weather forecasts. For example, they use less computing power than physics-based models, because they do not have to run thousands of mathematical equations.
Furthermore, many AI models have been found to perform better than traditional physics-based models at weather forecasts.
However, these models also have drawbacks.
Study author Prof Sebastian Engelke, a professor at the research institute for statistics and information science at the University of Geneva, tells Carbon Brief that AI models “depend strongly on the training data” and are “relatively constrained to the range of this dataset”.
In other words, AI models struggle to simulate brand new weather patterns, instead tending forecast events of a similar strength to those seen before. As a result, it is unclear whether AI models can simulate unprecedented, record-breaking extreme events that, by definition, have never been seen before.
Record-breaking extremes
Extreme weather events are becoming more intense and frequent as the climate warms. Record-shattering extremes – those that break existing records by large margins – are also becoming more regular.
For example, during a 2021 heatwave in north-western US and Canada, local temperature records were broken by up to 5C. According to one study, the heatwave would have been “impossible” without human-caused climate change.
The new study explores how accurately AI and physics-based models can forecast such record-breaking extremes.
First, the authors identified every heat, cold and wind event in 2018 and 2020 that broke a record previously set between 1979 and 2017. (They chose these years due to data availability.) The authors use ERA5 reanalysis data to identify these records.
This produced a large sample size of record-breaking events. For the year 2020, the authors identified around 160,000 heat, 33,000 cold and 53,000 wind records, spread across different seasons and world regions.
For their traditional, physics-based model, the authors selected the High RESolution forecast model from the Integrated Forecasting System of the European Centre for Medium-Range Weather Forecasts. This is “widely considered as the leading physics-based numerical weather prediction model”, according to the paper.
They also selected three “leading” AI weather models – the GraphCast model from Google Deepmind, Pangu-Weather developed by Huawei Cloud and the Fuxi model, developed by a team from Shanghai.
The authors then assessed how accurately each model could forecast the extremes observed in the year 2020.
Dr Zhongwei Zhang is the lead author on the study and a researcher at Karlsruhe Institute of Technology. He tells Carbon Brief that many AI weather forecast models were built for “general weather conditions”, as they use all historical weather data to train the models. Meanwhile, forecasting extremes is considered a “secondary task” by the models.
The authors explored a range of different “lead times” – in other words, how far into the future the model is forecasting. For example, a lead time of two days could mean the model uses the weather conditions at midnight on 1 January to simulate weather conditions at midnight on 3 January.
The plot below shows how accurately the models forecasted all extreme events (left) and heat extremes (right) under different lead times. This is measured using “root mean square error” – a metric of how accurate a model is, where a lower value indicates lower error and higher accuracy.
The chart on the left shows how two of the AI models (blue and green) performed better than the physics-based model (black) when forecasting all weather across the year 2020.
However, the chart on the right illustrates how the physics-based model (black) performed better than all three AI models (blue, red and green) when it came to forecasting heat extremes.
The authors note that the performance gap between AI and physics-based models is widest for lower lead times, indicating that AI models have greater difficulty making predictions in the near future.
They find similar results for cold and wind records.
In addition, the authors find that AI models generally “underpredict” temperature during heat records and “overpredict” during cold records.
The study finds that the larger the margin that the record is broken by, the less well the AI model predicts the intensity of the event.
‘Warning shot’
Study author Prof Erich Fischer is a climate scientist at ETH Zurich and a Carbon Brief contributing editor. He tells Carbon Brief that the result is “not unexpected”.
He adds that the analysis is a “warning shot” against replacing traditional models with AI models for weather forecasting “too quickly”.
The analysis, he continues, is a “warning shot” against replacing traditional models with AI models for weather forecasting “too quickly”.
AI models are likely to continue to improve, but scientists should “not yet” fully replace traditional forecasting models with AI ones, according to Fischer.
He explains that accurate forecasts are “most needed” in the runup to potential record-breaking extremes, because they are the trigger for early warning systems that help minimise damages caused by extreme weather.
Leonardo Olivetti is a PhD student at Uppsala University, who has published work on AI weather forecasting and was not involved in the study.
He tells Carbon Brief that “many other studies” have identified issues with using AI models for “extremes”, but this paper is novel for its specific focus on extremes.
Olivetti notes that AI models are already used alongside physics-based models at “some of the major weather forecasting centres around the world”. However, the study results suggest “caution against relying too heavily on these [AI] models”, he says.
Prof Martin Schultz, a professor in computational earth system science at the University of Cologne who was not involved in the study, tells Carbon Brief that the results of the analysis are “very interesting, but not too surprising”.
He adds that the study “justifies the continued use of classical numerical weather models in operational forecasts, in spite of their tremendous computational costs”.
Advances in forecasting
The field of AI weather forecasting is evolving rapidly.
Olivetti notes that the three AI models tested in the study are an “older generation” of AI models. In the last two years, newer “probabilistic” forecast models have emerged that “claim to better capture extremes”, he explains.
The three AI models used in the analysis are “deterministic”, meaning that they only simulate one possible future outcome.
In contrast, study author Engelke tells Carbon Brief that probabilistic models “create several possible future states of the weather” and are therefore more likely to capture record-breaking extremes.
Engelke says it is “important” to evaluate the newer generation of models for their ability to forecast weather extremes.
He adds that this paper has set out a “protocol” for testing the ability of AI models to predict unprecedented extreme events, which he hopes other researchers will go on to use.
The study says that another “promising direction” for future research is to develop models that combine aspects of traditional, physics-based weather forecasts with AI models.
Engelke says this approach would be “best of both worlds”, as it would combine the ability of physics-based models to simulate record-breaking weather with the computational efficiency of AI models.
Dr Kyle Hilburn, a research scientist at Colorado State University, notes that the study does not address extreme rainfall, which he says “presents challenges for both modelling and observing”. This, he says, is an “important” area for future research.
The post Traditional models still ‘outperform AI’ for extreme weather forecasts appeared first on Carbon Brief.
Traditional models still ‘outperform AI’ for extreme weather forecasts
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