In a landmark move on July 2, 2025, the European Commission proposed a legally binding climate target to slash net greenhouse gas emissions by 90% by 2040 from 1990 levels. While hailed as an ambitious climate action step, the proposal has ignited a heated debate due to a key provision the use of international carbon credits.
Under this proposal, starting in 2036, EU member states will be allowed to meet up to 3 percentage points of their emissions reduction target through carbon credits purchased from developing countries via a United Nations-backed market. These credits are expected to come from projects such as forest restoration and land-use improvements.
EU Climate Commissioner Wopke Hoekstra defended the move, calling it “economically, securely, and geopolitically sensible.” He emphasized that emissions reduction regardless of their geographical origin benefit the planet as a whole. According to Hoekstra, the credits will be subject to rigorous quality standards, and their use must be “additional” to current national decarbonization efforts, not a substitute.
However, this flexibility has drawn sharp criticism from environmental groups and climate scientists. Many fear that it could undermine the very goal the policy aims to achieve. Green groups warn of the rise of “junk offsets” projects that do not truly reduce emissions or would have happened anyway, and therefore fail the test of “additionality.”
“There’s a real risk of Europe outsourcing its climate responsibility,” one EU lawmaker warned. “Planting trees abroad while continuing to pollute at home is not climate leadership it’s carbon laundering.”
The EU’s own scientific advisory board had recommended a more ambitious target of 90–95% cuts without relying on international offsets. They cautioned that outsourcing emissions reductions might divert critical investment away from domestic green infrastructure and innovation, slowing the EU’s own energy transition.
Critics also highlight the loopholes such mechanisms can create, allowing wealthier nations to maintain high levels of domestic emissions while claiming progress through overseas environmental projects projects whose long-term impacts and verifiability often remain questionable.
Still, proponents argue that international carbon markets can play a role if strictly regulated in supporting global cooperation on climate change, particularly by funneling climate finance to the Global South. With proper safeguards, transparency, and independent verification, carbon credits could complement not replace direct emission cuts at home.
Ultimately, the EU’s decision underscores a growing dilemma in global climate policy: how to combine local responsibility with global solidarity. Whether this offset provision proves to be a smart, pragmatic addition or a dangerous form of greenwashing will depend on the quality of the implementation and the political will to prioritize integrity over convenience.
The Commission is set to outline detailed rules and criteria for these credits in 2026. Until then, the debate continues: Is this a bold leap forward or a backdoor exit from true climate accountability?