The French government presented in the Council of Ministers on 10 February its draft 'climate and resilience' bill. The draft incorporates several of the 149 proposals drafted by the Citizens' Convention on Climate (Convention Citoyenne pour le Climat: CCC) and presented to President Emmanuel Macron in June 2020 on how to reduce domestic greenhouse gas emissions by 40% by 2030.

The National Assembly, France's lower house of parliament, should start debating the bill in March. The government would aim for approval by mid-2021, well ahead of the presidential election. The MoDem and Agir parties are likely to back President Macron's ruling La République En Marche! (LREM) party, permitting passage of the legislation.

Key sectoral impacts

• The proposed provisions would particularly affect the automotive, aviation, mining, construction, and oil and gas sectors. The draft includes 69 articles divided into six thematic sections. Key provisions include a proposed ban on advertising for polluting products such as fossil fuels and a ban on domestic flights for routes with a corresponding train journey taking under 2.5 hours. The sale of the most polluting categories of vehicles would be prohibited from 2030. Housing with an F or G energy class would be subject to additional rental cap and would no longer be admitted to the rental market from 2028. The bill also envisages restrictions on the construction of new commercial zones on parklands as well as the introduction of an "ecocide" offence and judges who specialise in environmental law.
• The incorporation of the new Mining Code in the draft 'climate and resilience' bill seeks to accelerate and ensure its adoption. The introduction of a new Mining Code was delayed several times under previous governments. The new code would update the current one, first drafted in 1810, modernising the framework for extractive industries and reflecting new technologies. The amendments would introduce stricter environmental and social guarantees, including public consultation and environmental analysis prior to granting project permits.
• Mining exploration permits would no longer be granted by ministerial decree; prefectural approval will strengthen the role of the local government. The fight against illegal mining, which according to the government is six times larger than legal mining in French Guiana, will be a key instrument in reducing the adverse environmental impact of mining activities. Additionally, the ruling issued by a Paris court on 3 February 2021, which found the French state guilty of failing to take adequate steps to cut greenhouse gas emissions, increases the risk of delays or cancellations to high-profile mining projects in France that have attracted strong public opposition.

Environmental issues are likely to remain a key focus in President Macron's agenda ahead of the April 2022 presidential election. The strong electoral results for the Europe Ecology - The Greens (Europe Écologie Les Verts: EELV) party in the 2020 municipal elections increase the likelihood that ecological transition and climate change will become key components of Macron's upcoming electoral campaign. The holding of a constitutional referendum on the inclusion of a commitment to fight climate change in the French Constitution before the 2022 election is also likely to remain one of Macron's objectives. Policy efforts will be supported by allocating EUR30 billion of the 'France Relance' EUR100-billion economic recovery programme to green investments (thus aligning with wider EU goals previously expressed by EU Commission President Ursula von der Leyen) for the use of EU recovery funds.

Posted 16 February 2021 by Bibianna Norek, Research Analyst, Europe & CIS, Country Risk, S&P Global Market Intelligence