ESG - Commission adopts Delegated Act on gas and nuclear activities

As we have previously reported, in February 2022, the European Commission put forward draft proposals to amend Level 2 measures under the Taxonomy Regulation to include natural gas and nuclear activities under the EU's ESG taxonomy.

The proposed CDA would also amend Commission Delegated Regulation made under Article 8 of the Taxonomy Regulation to require large listed non-financial and financial companies to disclose the proportion of their activities linked to natural gas and nuclear energy.

Now that these proposals have been translated into all official languages of the EU, on 10 March 2022, the European Commission formally adopted them as a Complementary Climate Delegated Act (CDA).

Under the proposed CDA, the conditions for inclusion of natural gas and nuclear activities include:

• that they contribute to the transition to climate neutrality;
• for nuclear, that it fulfils nuclear and environmental safety requirements; and
• for natural gas, that it contributes to the transition from coal to renewables.

Next Steps

The Council of the EU and the European Parliament now have until 11 July to scrutinise the Commission’s proposals – either institution is able to extend this by a further two months, to 11 September 2022, if they object to its contents as they stand

The intention is for the provisions of the CDA to apply from 1 January 2023.