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WIR SCHAFFEN WISSEN – HEUTE FÜR MORGEN
Energy and climate policies in major European
Countries: insights from the POLIZERO project
Evangelos Panos :: Energy Economics Group :: Paul Scherrer Institut
Winter 2021 Semi-Annual ETSAP meeting, 29-30 November 2021, Oslo, Norway
• Assess a suite of Swiss decarbonisation policies
− also based on successful European examples
− using stakeholder consultation and position papers
• EU decarbonisation impacts on Swiss policies/targets
• Robust dynamic adaptive Swiss policy pathways
The POLIZERO project
Seite 2
The POLIZERO project has
received funding from the Swiss
Federal Office for Energy
JRC EU TIMES model: Policy performance
• EU energy and climate targets scenarios
• Swiss policy explorative pathways
• Parametric analysis of policy contextual factors
• Scenario matrix with policies performance
AIM model: Adaptive policy making
• Machine learning functionality
• When and why a policy deviates from its target
• Visualisation of policy pathways
• Monitoring of contextual factors for policy change
Model-based exploration for efficient policies
Seite 3
Net-
SC with
BESS
(65%
subsidy)
SC with
BESS
(50%
subsidy)
SC with
BESS
(30%
subsidy)
0
100
200
300
400
500
600
700
800
0.5
1.5
2.5
3.5
4.5
Simulation timeframe
Policy
Package 1
Policy
Package 2
Policy
Package 3
Policy
Package 4
Sub-target interval trajectory
Pathway
target
Policy
outcome
• Collecting and consolidating policies from:
− IEA policy database and country reports
− Climate policy database
− RES Legal Europe database
− Relevant EU and Swiss projects
− National energy and climate plans and strategies
− Transposition of the EU directives to national laws
• European Countries covered:
− Central Europe (CH, DE, FR, AT)
− Nordic region (NO, SE, FI, DK)
− British Isles (UK, IR)
− Southern Europe (ES, PT, IT, GR)
WP1: Policy inventory in selected European countries
Seite 4
Policy Inventory - main fields for policy description
Seite 5
ID Policy Policy type Description
Start/End
year
Status
Part of
policy
package
Replaces
policy
Sector Technology Jurisdiction Budget Impact Source
Policy inventory contents for each country
Seite 6
POLIZERO
Energy and
Climate
Inventory
Policy
database
Key energy
statistics
Policy-
making
traits and
challenges
Innovative
Policies
Key
Policies
Policy
Context
The inventory will be available at www.polizero.ch
The evolving policy landscape in energy supply
Seite 7
Direct
subsidies in
RES in
electricity
Feed-in
tariffs in
RES in
electricity
Certificates
and quotas
of RES in
electricity
Competitive
tenders in
RES in
electricity
Direct subsidies for
RES in district
heating
Direct subsidies
for “green” gases
Feed-in tariffs for
“green” gases
Feed-in tariffs for RES
in district heating
H2 market
regulations
(also green H2
in EU-RED)
CC(U)S
R&D&D
H2 and
PtX
subsidies
Tenders and
subsidies for
storage
Market
regulation
for
storages
Note: this is not a strict chronological order and the instruments are non exhaustive
Net
metering
CC(U)S
Regulation
Electricity
market
reforms
ETS
Grid connection
costs adjustments
CC(U)S
Market Pools
and Tenders
Feed-in
premium in
RES in
electricity
• Policy stability and predictability enables capacity build up
• Policy adjustments to reduce investment risks
• Integrated measures and mandates successful for heating and cooling
• Policy signals to make new options part of national energy systems
Decarbonisation in energy supply – lessons learned
Seite 8
The evolving policy landscape in industry
Seite 9
Note: this is not a strict chronological order and the instruments are non exhaustive
H2
support
schemes
Support for
CC(U)S
infrastructure
Funding
mechanisms for
innovative
industrial
clusters
Financial incentives
for smart metering
Circular
economy
business
models
Grants for
switching to
electricity
Energy
efficiency
competitive
tenders
Standards on cross-
sectoral technologies
Efficiency
Incentives for
Large Electricity
Consumers
Waste-
heat
recovery
grants
Mandatory
energy
audits
Support
to CHP &
renewable
heat
ETS
Carbon
Border Tax
Adjustment
Industry
4.0 tax
credits
and
supports
Voluntary
agreements
White
certificates
and quoatas
Investment
grants and
loans
Peak demand
shaving support
schemes
• Many decarbonisation projects lack positive business cases
• Frameworks encouraging markets for low-carbon high-priced products are discussed
• Grants to promote electrification have been successful so far
• Industry-energy sector policies coordination is needed
• Supports to circular economy and industrial symbiosis / innovative clusters
Decarbonisation in industry – lessons learned
Seite 10
The evolving policy landscape in buildings
Seite 11
Eco-design and
labelling requirements
for appliances
Energy and
Carbon taxes
Minimum
energy
efficiency
requirements
Sharing cost
between tenants
and landlords and
ESCOs
Carbon
pricing
Note: this is not a strict chronological order and the instruments are non exhaustive
Energy
service
markets for
heat pumps
Bans of fossil-
fuels/inefficient
equipment
Minimum
emissions
performance
standards
Serial
renovations
Smart
metering
regulations
Subsidies for EV
infrastructure in
buildings
Information/
awareness
campaigns
Energy poverty
measures
Energy
audits
Voluntary
agreements
Subsidies
and solft
loans
Updated
building codes
also for EV
charging
nZEB
demonstration
programmes
Biofuels/e-
fuels quotas
• Policy targets efficiency and decarbonisation acceleration
• Challenges are high upfront costs:
− Incentives (subsidies, loans, tax regulations, … )
− Mandates (bans of fossil boilers,…)
− Access to capital
− Tackling energy poverty
• New financing schemes for sharing beneficiaries’ costs (split incentives)
• Policies to change consumption behavior (campaigns, labelling, awareness,…)
Decarbonisation in buildings – lessons learned
Seite 12
The evolving policy landscape in mobility sector
Seite 13
Fuel taxes
(and exemptions)
Note: this is not a chronological order and the instruments are non exhaustive
MaaS
Circulation
tax benefits
Registration
tax benefits
Import tax
benefits
Scrapping
subsidies
Purchase
subsidies
Vehicle
emissions
standards
Low-
carbon
zones
Bans on
vehicles
E-fuels on
aviation
EV
infrastructure
promotion
Bonus-
malus
(ecobonus
vs
ecotaxes)
Biofuel
quotas
Mobility
pricing
Public
transport
promotion
(subsidies,
bundling)
Car
labelling
Carbon pricing
Aviation
taxes
Life-cycle
based fuel
taxes
Heavy
trucks
taxes
H2
infrastructure
tenders
H2 fuel
stations
requirements
and subsidies
Local
incentives
for EVs
Information
campaigns
for EVs
Public
procurement
• Subsidies were instrumental in accelerating EV sales, but broader portfolios are needed
• Information/Campaigns on alternative transport infrastructure
• Vehicle innovation complemented with innovative transport demand management
• EU-ETS experience sets the way to a carbon pricing scheme
Decarbonisation in mobility – lessons learned
Seite 14
• Post-2020 policies aim at enabling low-carbon innovations
− especially in sectors with long investment cycles
• Strengthening of the carbon markets are on the table
− expansion of ETS to transport/buildings , carbon border tax adjustments
• Social just transition is a major concern (particularly in relation to carbon pricing)
− revenue re-distribution to households, end exemptions for certain sectors
• Strengthening of natural carbon sinks and access to international CO2 storage sites
• Security of supply and access to zero-carbon energy carriers concerns
Some conclusions from the policy inventory contents
Seite 15
Seite 16
Wir schaffen Wissen – heute für morgen
Mein Dank geht an:
• Nikos Kleanthis (UPRC)
• Ilias Tsopelas (UPRC)
• Alexandros Flamos (UPRC)
• Meixi Zhang (PSI)
• Bakytzhan Suleimenov (PSI)
• Tom Kober (PSI)
Evangelos Panos
Energy Economics Group
Paul Scherrer Institute
evangelos.panos@psi.ch

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Energy and climate policies in major European Countries: insights from the POLIZERO project

  • 1. WIR SCHAFFEN WISSEN – HEUTE FÜR MORGEN Energy and climate policies in major European Countries: insights from the POLIZERO project Evangelos Panos :: Energy Economics Group :: Paul Scherrer Institut Winter 2021 Semi-Annual ETSAP meeting, 29-30 November 2021, Oslo, Norway
  • 2. • Assess a suite of Swiss decarbonisation policies − also based on successful European examples − using stakeholder consultation and position papers • EU decarbonisation impacts on Swiss policies/targets • Robust dynamic adaptive Swiss policy pathways The POLIZERO project Seite 2 The POLIZERO project has received funding from the Swiss Federal Office for Energy
  • 3. JRC EU TIMES model: Policy performance • EU energy and climate targets scenarios • Swiss policy explorative pathways • Parametric analysis of policy contextual factors • Scenario matrix with policies performance AIM model: Adaptive policy making • Machine learning functionality • When and why a policy deviates from its target • Visualisation of policy pathways • Monitoring of contextual factors for policy change Model-based exploration for efficient policies Seite 3 Net- SC with BESS (65% subsidy) SC with BESS (50% subsidy) SC with BESS (30% subsidy) 0 100 200 300 400 500 600 700 800 0.5 1.5 2.5 3.5 4.5 Simulation timeframe Policy Package 1 Policy Package 2 Policy Package 3 Policy Package 4 Sub-target interval trajectory Pathway target Policy outcome
  • 4. • Collecting and consolidating policies from: − IEA policy database and country reports − Climate policy database − RES Legal Europe database − Relevant EU and Swiss projects − National energy and climate plans and strategies − Transposition of the EU directives to national laws • European Countries covered: − Central Europe (CH, DE, FR, AT) − Nordic region (NO, SE, FI, DK) − British Isles (UK, IR) − Southern Europe (ES, PT, IT, GR) WP1: Policy inventory in selected European countries Seite 4
  • 5. Policy Inventory - main fields for policy description Seite 5 ID Policy Policy type Description Start/End year Status Part of policy package Replaces policy Sector Technology Jurisdiction Budget Impact Source
  • 6. Policy inventory contents for each country Seite 6 POLIZERO Energy and Climate Inventory Policy database Key energy statistics Policy- making traits and challenges Innovative Policies Key Policies Policy Context The inventory will be available at www.polizero.ch
  • 7. The evolving policy landscape in energy supply Seite 7 Direct subsidies in RES in electricity Feed-in tariffs in RES in electricity Certificates and quotas of RES in electricity Competitive tenders in RES in electricity Direct subsidies for RES in district heating Direct subsidies for “green” gases Feed-in tariffs for “green” gases Feed-in tariffs for RES in district heating H2 market regulations (also green H2 in EU-RED) CC(U)S R&D&D H2 and PtX subsidies Tenders and subsidies for storage Market regulation for storages Note: this is not a strict chronological order and the instruments are non exhaustive Net metering CC(U)S Regulation Electricity market reforms ETS Grid connection costs adjustments CC(U)S Market Pools and Tenders Feed-in premium in RES in electricity
  • 8. • Policy stability and predictability enables capacity build up • Policy adjustments to reduce investment risks • Integrated measures and mandates successful for heating and cooling • Policy signals to make new options part of national energy systems Decarbonisation in energy supply – lessons learned Seite 8
  • 9. The evolving policy landscape in industry Seite 9 Note: this is not a strict chronological order and the instruments are non exhaustive H2 support schemes Support for CC(U)S infrastructure Funding mechanisms for innovative industrial clusters Financial incentives for smart metering Circular economy business models Grants for switching to electricity Energy efficiency competitive tenders Standards on cross- sectoral technologies Efficiency Incentives for Large Electricity Consumers Waste- heat recovery grants Mandatory energy audits Support to CHP & renewable heat ETS Carbon Border Tax Adjustment Industry 4.0 tax credits and supports Voluntary agreements White certificates and quoatas Investment grants and loans Peak demand shaving support schemes
  • 10. • Many decarbonisation projects lack positive business cases • Frameworks encouraging markets for low-carbon high-priced products are discussed • Grants to promote electrification have been successful so far • Industry-energy sector policies coordination is needed • Supports to circular economy and industrial symbiosis / innovative clusters Decarbonisation in industry – lessons learned Seite 10
  • 11. The evolving policy landscape in buildings Seite 11 Eco-design and labelling requirements for appliances Energy and Carbon taxes Minimum energy efficiency requirements Sharing cost between tenants and landlords and ESCOs Carbon pricing Note: this is not a strict chronological order and the instruments are non exhaustive Energy service markets for heat pumps Bans of fossil- fuels/inefficient equipment Minimum emissions performance standards Serial renovations Smart metering regulations Subsidies for EV infrastructure in buildings Information/ awareness campaigns Energy poverty measures Energy audits Voluntary agreements Subsidies and solft loans Updated building codes also for EV charging nZEB demonstration programmes Biofuels/e- fuels quotas
  • 12. • Policy targets efficiency and decarbonisation acceleration • Challenges are high upfront costs: − Incentives (subsidies, loans, tax regulations, … ) − Mandates (bans of fossil boilers,…) − Access to capital − Tackling energy poverty • New financing schemes for sharing beneficiaries’ costs (split incentives) • Policies to change consumption behavior (campaigns, labelling, awareness,…) Decarbonisation in buildings – lessons learned Seite 12
  • 13. The evolving policy landscape in mobility sector Seite 13 Fuel taxes (and exemptions) Note: this is not a chronological order and the instruments are non exhaustive MaaS Circulation tax benefits Registration tax benefits Import tax benefits Scrapping subsidies Purchase subsidies Vehicle emissions standards Low- carbon zones Bans on vehicles E-fuels on aviation EV infrastructure promotion Bonus- malus (ecobonus vs ecotaxes) Biofuel quotas Mobility pricing Public transport promotion (subsidies, bundling) Car labelling Carbon pricing Aviation taxes Life-cycle based fuel taxes Heavy trucks taxes H2 infrastructure tenders H2 fuel stations requirements and subsidies Local incentives for EVs Information campaigns for EVs Public procurement
  • 14. • Subsidies were instrumental in accelerating EV sales, but broader portfolios are needed • Information/Campaigns on alternative transport infrastructure • Vehicle innovation complemented with innovative transport demand management • EU-ETS experience sets the way to a carbon pricing scheme Decarbonisation in mobility – lessons learned Seite 14
  • 15. • Post-2020 policies aim at enabling low-carbon innovations − especially in sectors with long investment cycles • Strengthening of the carbon markets are on the table − expansion of ETS to transport/buildings , carbon border tax adjustments • Social just transition is a major concern (particularly in relation to carbon pricing) − revenue re-distribution to households, end exemptions for certain sectors • Strengthening of natural carbon sinks and access to international CO2 storage sites • Security of supply and access to zero-carbon energy carriers concerns Some conclusions from the policy inventory contents Seite 15
  • 16. Seite 16 Wir schaffen Wissen – heute für morgen Mein Dank geht an: • Nikos Kleanthis (UPRC) • Ilias Tsopelas (UPRC) • Alexandros Flamos (UPRC) • Meixi Zhang (PSI) • Bakytzhan Suleimenov (PSI) • Tom Kober (PSI) Evangelos Panos Energy Economics Group Paul Scherrer Institute evangelos.panos@psi.ch