“To make electric cars accessible to all, we are going to introduce social leasing”.

Sometimes it feels as though, despite the worsening climate crisis, environmental issues and the fight against global warming occupy less space in the public debate today than they did a few years ago. Other topics – such as defence or many of the announcements made by Donald Trump over the past year – seem to take precedence. Has it become more complicated to be minister of the environment in such a context?

In my opinion, it has become even more essential, but also more demanding. When you look at official data – both European and Luxembourgish – public interest in climate issues remains extremely high. A recent national survey conducted by the Climate Policy Observatory showed that 88% of adults and 78% of young people consider climate change a major concern.

This is very good news: an overwhelming majority of the population has therefore grasped the scientific reality of climate change and remains committed to fighting it. They are also actively participating in the ecological transition on a daily basis. The success of the Klimabonus Wunnen (housing subsidies) and the Klimabonus Mobilitéit (vehicle subsidies), implemented to support this transition, proves it. I see this as an encouragement to continue along this path. We mustn’t confuse media hype with reality.

The world’s leading power is now led by an avowed climate change denier. When Donald Trump bangs his fist on the table, many seem hesitant to oppose him. How can we continue to move forward in this fight when the international headwinds are so strong?

We follow the science. That’s our compass. After that, yes, we can deplore the fact that the White House no longer listens to science, but that doesn’t mean that all of America is climate sceptic. Several federal states, such as California, as well as companies and cities, are continuing to invest massively in the energy transition. This is also a reality, even if the current propaganda is trying to hide it.

And the European Union remains strong. Even a sceptical government like Viktor Orbán’s, for example, couldn’t prevent the adoption of the climate trajectory towards carbon neutrality by 2050. We now have clear milestones: -55% by 2030, -90% by 2040, and neutrality by 2050.

The majority of the European Union is therefore maintaining an ambitious course and continues to believe in a sustainable future. This is a strong signal. Moreover, we have attracted scientists to Europe, and particularly to our university in Luxembourg, who were previously based in the United States and who were no longer receiving funding under the current administration. You know, ecology, if reconciled with the economy and a just transition, is the growth of tomorrow. The prosperity of our future!

However, certain aspects of the “Green Deal,” the major European green pact, have been scaled back in recent months. This has often been perceived as a dismantling of the agreement, supported in particular by the EPP – the CSV’s political family at the European level – in association with nationalist groups. How do you justify this?

As a member of the Luxembourg government and not a member of the European Parliament, it’s difficult for me to comment on the association you mentioned. What I can say, however, is that we must distinguish between deregulation and simplification. The “Green Deal” launched by the von der Leyen I Commission dates back six or seven years.

It was therefore conceived in a very different context than today’s. And, as we’ve moved forward, we’ve seen that certain measures need to be rebalanced. Not to weaken their objectives, but to ensure that they can be implemented and supported by our citizens.

Let me give you a concrete example: the European regulation against deforestation. Luxembourg already has an ambitious policy in this area and experiences no deforestation, as our forests are strictly protected by the Forestry Act and the act concerning the protection of nature and natural resources.

However, the new regulation would impose additional administrative requirements – in terms of reports, controls, and procedures – which would force us to hire three people within the Nature and Forest Administration to handle the monitoring. And this, without any real benefit to the protection of our forests. In a case like this, a certain degree of flexibility is needed, and the rules must be simplified for the benefit of all.

The environmental share in the Luxembourg state’s 2026 budget remains substantial. But is there a risk that it will be reduced due to, for example, the anticipated tax revenue from the tax reform or the announced increase in the defence budget?

No. Ecology and the ecological transition are priorities for this government. Moreover, we see the subsidies offered to citizens as investments, not mere expenses. They will allow Luxembourg to become more energy independent, something that has never been the case in the country’s history.

Furthermore, these investments also generate revenue: VAT, taxes, economic activity […] As is the case, for example, with the subsidies we offer for the purchase of an electric vehicle. Revenue that we can then reinvest in the Luxembourg economy.

And let’s not forget that all these investments reduce the costs that climate change will generate in the future.

Indeed, electric car sales are stagnating: at the end of 2025, only 12.7% of new car registrations were electric, far from the 49% projected for 2030. Has the target become unrealistic?

It’s an ambitious plan, but we absolutely mustn’t abandon it. Otherwise, we’d send a very bad signal. Our role is to support both businesses and households during this transition phase, with the introduction of new subsidies. For example, to make electromobility accessible to everyone, the government will implement a social leasing programme specifically for the most vulnerable households.

What does this involve in practical terms?

It’s a mechanism that has already been tested in France. It will enable the most vulnerable households to make the switch to an electric car, through a personal lease with significantly reduced monthly payments. So, to make electro-mobility accessible to all, the government will contribute to the financing, thereby accelerating the ecological transition, while also ensuring social justice.

When will this be implemented?

It could happen this year, because it’s one of the measures in the Social Plan for the Climate that we’ll be submitting to Europe in the next few months. We are currently in discussions with the partners and stakeholders who will implement it.

One of this government’s goals is to make sustainable development the most obvious, simplest, and least expensive option for everyone. This new mechanism is a prime example. In addition, in 2027, we will also introduce pre-financing of the subsidy offered for electric vehicles under the Klimabonus Mobilitéit (vehicle subsidies) scheme. This will be achieved through a third-party payment system. Citizens will no longer have to pay the subsidy upfront, as we have already implemented for the installation of solar panels .

You mention a Social Plan for the Climate. What exactly is this?

It’s a European obligation. It’s a mechanism that provides for the implementation of measures to mitigate the social impact of the ecological transition towards carbon neutrality by 2050. And this applies particularly to vulnerable households and small companies. Just like the two measures I just mentioned.

This plan is directly linked to the introduction of a new European carbon market, ETS 2. This follows ETS 1, which came into effect in 2005. It is a market mechanism established to reduce CO₂ emissions. As a reminder, it set carbon caps for actors in certain sectors, such as industry and aviation, and required them to purchase CO₂ allowances if they exceed these caps.

Some sectors, such as construction and transportation, were not yet affected. However, they will be with ETS 2, which will come into effect in 2028. This will notably result in an increase in fossil fuel prices.

To avoid a social shock, each country must therefore propose a Social Climate Plan explaining how it intends to support vulnerable households. In our country, the goal is to guide citizens towards electromobility, so that they are not affected by the price increase at the pump, and also to encourage them to move away from fossil fuels, all while protecting the most vulnerable citizens.

Do we have any idea how much of a difference consumers will see at the pump?

Luxembourg anticipated this increase with the “CO₂ tax,” which has been gradually introduced since 2022. Today, for example, this tax represents approximately 11 to 12 cents of the price of a litre of diesel. This prepares the ground and will therefore avoid too abrupt a shock in 2028, when this new European system comes into effect.

I note, however, that while some countries, such as Luxembourg, have anticipated this, others have not. Belgium, for example. And it remains to be seen whether this will have an indirect impact on our situation.

There is also a question to be decided by this government in the coming weeks: whether or not to maintain our carbon tax until 2030. The fact that we have introduced it leaves us with this option. Either we move to ETS 2 from 2028, or we can wait until 2030.

Luxembourg is expected to experience the highest population growth in the European Union during the 21st century. How can this explosive growth be reconciled with climate goals? Isn’t it an impossible mission?

It’s a challenge that has been occupying Luxembourg for some time now […] But I believe there is an answer: intelligent densification.

The aim is to concentrate a significant portion of population growth in major urban centers – the capital, the main municipalities in the south, and the Nordstad region (a group of communes in the north of Luxembourg) – while ensuring the development of affordable housing.

Luxembourg remains far below the population densities observed elsewhere: Luxembourg City has approximately 2,500 to 2,600 inhabitants per square kilometer, compared to nearly 8,000 in Copenhagen, for example, and more than 21,000 in Paris, the most densely populated city in Europe.

Greater density brings living spaces, workplaces, and services closer together: this means less motor traffic, more efficient public transport, and a more accessible city on a human scale. At the same time, the ministry supports municipalities through greening programmes, climate change adaptation initiatives, and the Klimapakt, a partnership designed to assist them in implementing local climate and energy policies.

It is sometimes said that, when it comes to the energy transition, Luxembourg distributes a lot of “carrots” but very few “sticks.” Or, put another way, too much aid, not enough constraints. Is this a sustainable model?

Aid schemes, subsidies and all other financial support are measures that promote national cohesion. And this just transition, which I’ve been talking about for the past few minutes, is a priority. We can’t expect households to replace their boilers with heat pumps, buy electric cars, or install solar panels without providing them with financial assistance. We must encourage them, incentivise them to take this step forward. It’s essential.

But be warned, there are also binding mechanisms in place. Take the carbon tax, for example, which sends a clear message: if we continue to invest in fossil fuels, we will pay more. It’s a balance we’re trying to strike.

But will there still be enough money in the future to pursue such a spending policy?

Yes. Because what this government is implementing is a growth policy. Investments in the ecological transition, sustainable mobility, and energy efficiency are not wasted expenses, as I explained. They stimulate activity, create value, and generate new revenue. By reducing taxes, as the finance minister is doing (with his tax reform, editor’s note), or by supporting investment, we also restore purchasing power, which allows us to inject money back into the economy.

The goal is for this growth to gradually become sustainable. This momentum will allow us to finance these policies in the long term. In addition, there is another lever: the Luxembourg financial center, which we want to strengthen as a hub for sustainable finance. I cannot yet reveal the details, but we are in discussions with new sustainable investment funds. Our aim is to make the Luxembourg financial center the world’s leading financial center in terms of sustainable investments.