According to a study by the European Central Bank, the environmental footprint of Euro banknotes represents only "0.01%" of the annual activity of the European Bank.
Are Euro banknotes harmful to the environment? According to the European Central Bank (ECB), which published its first study on the subject in November, the environmental footprint of banknotes is "very small".
CO2 emissions, damage to the ozone layer, and water consumption. According to the study, the total impact of banknote production, from manufacture to destruction, is equivalent to "an 8 km car trip" or "0.01% of the total environmental impact of annual European consumption activities".
According to the study's authors, the main factors affecting the ecological footprint of banknotes are Atm energy consumption and the transportation of cash.
"The Eurosystem is committed to making Euro banknotes as environmentally friendly as possible while ensuring that cash is widely available and accepted", ECB board member Piero Cipollone is quoted as saying in a press release.
The ECB also points out that it is taking steps to reduce the environmental impact of euro banknotes "as early as 2004", for example by trying to use only environmentally friendly cotton and banning the dumping of used bills in landfills. The company also stresses that it is conducting "extensive research and development to make future Euro banknotes even more environmentally friendly at all stages of their life cycle".
France, No. 1 Producer of Euro Banknotes
Cash remains the primary means of payment in the 20 eurozone countries, but its share is shrinking. Cash's share of physical payments fell from 72% in 2019 to 59% last year.
The Bank of France is also the main producer of Euro banknotes among the 11 Eurozone printers. This year, it has decided to build a new banknote printing plant on the site of the nearby Vic-le-Comte paper mill to replace its current plant in Chamalliere near Clermont-Ferrand.
When the project is completed in 2026, France should have "the most modern, efficient, and environmentally friendly banknote production center (paper mill and printing plant) in Europe", as the central bank announced in late September.
In conclusion, cash is a relatively environmentally friendly means of payment in the Eurozone. However, given the declining share of cash in physical payments, it is important to continue efforts to reduce its environmental impact.