The European Commission on Wednesday (Nov. 30) presented a draft law on energy strategy under a new, broader clean energy package. This shall translate existing targets for 2030 under the Paris Agreement into more concrete measures and impact nearly all parts of the European economy.
The European Union has set already in 2014 its target to cut CO2 emissions by at least 40 percent by 2030 compared to 1990 levels. Earlier this year, this number has been translated into national targets, together with proposals by the Commission for the Emissions Trading Scheme (ETS). In addition, renewable energy sources will have to contribute at least 27 percent to the energy mix in 2030, including a share of 50 percent in electricity production.
The “Clean Energy for All Europeans” legislative proposals – as officially named – cover the issues of energy efficiency, renewable energy, the design of the electricity market, security of electric supply and governance rules for the Energy Union as well as eco-design and mobility. As an encompassing element the Commission proposes a binding EU-wide target of 30 percent for energy efficiency by 2030. It entails the consequent update of, inter alia, the EU Energy Efficiency Directive and the Energy Performance of Buildings Directive.
The proposal, also referred to as “Winter package”, raises the energy efficiency 2030 target by three percent points from the indicative 27 percent goal, previously envisioned in the EU strategy. For this purpose, existing energy saving obligations requiring energy suppliers to save 1.5 percent of energy each year shall be extended up to 2030. With respect to eco-design and labelling, the proposed measures are expected to deliver energy savings comparable to the annual primary energy consumption of Sweden (600TWh).
According to EU official release, the improved energy efficiency target will contribute to reduce GHG emissions and improve energy security by reducing fossil fuel imports by 12 percent in 2030, corresponding to import saving of 70 billion euros.
The package shall mobilise up to 177 billion euros of public and private investments per year from 2021. This shall translate into an increase of GDP of 1 percent in the run-up to 2030. Moreover, the measures are estimated to induce the creation of 900,000 new jobs. The carbon intensity is expected to decline by 57 percent by 2030 compared to 2015 and a share of 72 percent of non-fossil fuels in electricity is projected for 2030.
The targets for renewable energies were reiterated. Moreover, the priority for renewable energies shall be abandoned in markets where they have a share higher than 15 percent. This faced harsh criticism by environmental campaigners according to the BBC, as well as the more general missed chance to ratchet up ambition in the targets set. As Reuters reports, the provisions for existing and small-scale installations will, however, be maintained.
Another contentious issue relates to fossil fuel subsidies. Although having the intent to end coal subsidies in capacity mechanisms that guarantee backup power reserves, the new proposal imposes a limit of 550 grams of CO2 per kilowatt hour, according to the BBC. This implies that newer, more efficient gas and coal fired power plants would still be able to obtain subsidies.
In addition, consumers shall be put in a better position with regard to the choice of their energy supplier. Enhanced transparency, which also includes clearer bills, shall facilitate switching of the supplier.
The building sector is also affected by new regulations. The sector accounts for 40 percent of total energy consumption. 75 percent of the buildings are energy-inefficient. Today’s renovating rate is only at 1 percent which would mean that it would take a whole century to upgrade to building stock to near-zero energy levels. Therefore, a building renovation market with a value up to 120 billion euros shall be created by 2030.
Last but not least, the Commission foresees a significant change with regards to biofuels. It wants to cap first-generation biofuels which are based on crops but instead phase in advanced biofuels which are for example based on agricultural and forestry waste.
The Climate Action Network Europe (CAN-Europe) has criticized the proposals for not being in line with the targets set in the Paris Agreement. A draft was already leaked several days ago, as Climate Home reported.
The legislative proposals have to be approved by the European Council as well as the European Parliament in order to get into force, a process which could take up to two years.
(Image: European flags in front of the Berlaymont building, headquarter of the European Commission, Brussels, Belgium. Photo credit: TPCOM/Flickr)