You might already be familiar with the EU taxonomy for sustainable activities, a classification system for environmentally sustainable economic activities. The Taxonomy Regulation, which entered into force in 2020, promotes market transparency and provides direction for green investments.

This Regulation establishes the basis for the EU taxonomy by setting out the overarching conditions that an economic activity has to meet to qualify as environmentally sustainable.

Under the Taxonomy Regulation, the Commission had to devise a list of environmentally sustainable activities by defining technical screening criteria for each environmental objective. They did so through delegated and implementing acts. In this article, we are taking a look at two of the taxonomy’s delegated acts, and why they are relevant for Level(s).

The Climate Delegated Act, published in 2021 and in force since January 2022, and the Environmental Delegated Act, adopted in June 2023 and currently under the scrutiny of the European Parliament and the Council, define a list of economic activities that make substantial contributions to climate change adaptation and mitigation, and to the transition to a circular economy.

The Climate Delegated Act states that any construction of a new building of a certain size (over 5 000 m²) reporting substantial contributions to climate change mitigation must calculate and disclose its Global Warming Potential at each stage of its life cycle.

This not only matches the concept behind Level(s), but also links directly to the framework, as disclosures must align with the building elements and technical equipment defined by Level(s) (indicator 1.2). Alternative tools may also be used, but they have to align with the Level(s) framework's minimum criteria.

Meanwhile, the Environmental Delegated Act specifies that certain construction and real estate activities that report substantial contributions to a circular economy must use  Level(s) indicators. This links to several indicators, including:

• For new buildings and renovations: indicators 2.2, 2.3 and 2.4 (at Level 2) as well as indicator 2.1
• For demolitions: indicator 2.2
• For concrete use in civil engineering: indicators 2.2, 2.3, and 2.4 (at Level 2).

For the Climate Delegated Act, companies will have to make disclosures aligning with the taxonomy by 2024, 2026 or 2027, depending on their size and whether they fall under the Non-Financial Reporting Directive (NFRD) or the Corporate Sustainability Reporting Directive. For the Environmental Delegated Act, the timeline will be 2025 for non-financial activities under the NFRD, or 2026 for financial activities.

If you are interested in finding out more, you can read both the Climate Delegated Act and the Environmental Delegated Act online.