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2030 climate & energy framework

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The European Union has agreed on a new 2030 Framework for climate and energy, which includes EU-wide targets and policy objectives for the period between 2020 and 2030. The targets aim to help the EU achieve a more competitive, secure and sustainable energy system and to meet its long-term 2050 greenhouse gas reductions target as set out in the 2050 Low Carbon Roadmap.

The framework was created to communicate to the market a clear commitment by the EU in view of encouraging private investment in new networks and low-carbon technologies. The targets themselves are based on a thorough analysis made by the European Commission that measured how to cost-effectively achieve decarbonisation by 2050.

The key targets are:

* 40% cut in greenhouse gas emissions (from 1990 levels);
* at least 27% of EU energy from renewables in terms of final consumption;
* and, at least 27% energy savings compared to business-as-usual.

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2030 climate & energy framework

  1. 1. Leonardo Energy Webinar The 2030 Climate & Energy Framework Aleš Šinkovec 03 June 2016
  2. 2. 22 Content I. Context of EU climate & energy policy II. The 2030 framework in brief III. Binding or not binding [national targets]? IV. The implementation challenge V. Governance and next steps
  3. 3. 33 Context of EU climate & energy policy § Why an EU climate & energy policy? § Tackle challenges: • Fight against anthropogenic climate change (Kyoto protocol & Paris agreement when ratified) • Ensure security of supply & reduce dependencies to energy imports • Stimulate growth and jobs § Lisbon Treaty gives competence to the EU institutions to legislate on energy matters § EU level action took off with the 2020 package and the 2050 low carbon roadmap
  4. 4. 44 Context of EU climate & energy policy § With the view to achieve the long term goal of 80-95% GHG emissions reduction by 2050, interim targets and plans are needed for their implementation § The 2020 Climate and energy targets ‘translated’ into the climate and energy package § Several pieces of legislation exist / were adopted to implement targets in reality § The 2030 framework, the revised targets and legislation will be the successor allowing the achievement of long term goals for 2050 20% cut in greenhouse gas emissions (from 1990 levels) 20% of EU energy from renewables 20% improvement in energy efficiency EU ETS (Emission Trading System) (2005/9) Effort Sharing Decision (2009) Renewable Energy Directive (2009) Energy Efficiency Directive (2012)
  5. 5. 55 The 2030 Framework in brief § In 2014 the European Commission proposed a new 2030 Climate and Energy Policy Framework, which was endorsed – with changes – by EU leaders in October 2014 § It builds on the 2020 climate and energy package § As its predecessor, the Climate and Energy framework sets up 3 key targets for 2030: At least 40% cuts in greenhouse gas emissions(from 1990 levels) At least 27% share for renewable energy At least 27% improvement in energy efficiency § In line with the longer term perspective set out in the Roadmap for moving to a competitive low carbon economy in 2050, the Energy Roadmap 2050 & the Transport White Paper § The EU targets is being “translated” into reviewed EU legislation (primarily directives) Emissions Trading System (ongoing) Effort Sharing Decision (Q3 2016) Energy Efficiency Directive (Q3 2016) Renewable Energy Directive (Q4 2016)
  6. 6. 66 Highlights from the Council’s perspective § “All Member States participate, balancing fairness and solidarity” § Continuation due to different levels of development (GDP, existing installed base) § Binding EU level targets, not to be translated into binding national targets § Full freedom to determine energy mix
  7. 7. 77 2020 vs 2030 divergence § 2020 targets, while binding, were lenient enough not to be too disruptive § 2030 targets are a compromise (“at least”) due to their potential for disruption; two examples: § 27% renewables means just over 50% of gross final consumption of electricity will come from renewables § 43% reduction in emission from ETS sector presents the limit of today’s technology in many industrial processes § 2030 targets are also taking into account national level divergences: § By 2014, Sweden achieved over 50% renewables, Finland and Austria over 30%, Ireland under 8%, whereas Luxembourg and Malta under 4%.
  8. 8. 88 Increasing flexibility 2020 Package 20% cut in greenhouse gas emissions (from 1990 levels) 20% of EU energy from renewables 20% improvement in energy efficiency 2030 Framework At least 40% cuts in greenhouse gas emissions (from 1990 levels) At least 27% share for renewable energy At least 27% improvement in energy efficiency Binding through ETS and ESD Binding at EU level Only Binding through ETS and ESD Binding Through RED Binding Through EED
  9. 9. 99 Binding or not binding [national targets]? § Controversial aspect of 2030 Framework → National targets § Council of the EU decided in favour of ‘Flexible Targets’ in October 2014 (Council Conclusions) § It means that the new EU targets will not be translated into national binding targets (unlike in the previous 2020 Package) § Why? § Officially due to the willingness to leave “greater flexibility for member states” in line with Article 194(2) of the Treaty on the Functioning of the European Union (TFEU) on the issue of national control over the energy mix. § In reality, absence of common vision on how the EU energy market should be organized, Member States want to retain the power to determine their national energy policies § Challenges arising from the absence of national targets § Free-loading: risk that national efforts will not add up to the EU aggregate commitments § Fragmentation: Lack of strong EU policies could allow member states to pursue policies that fragment the internal energy market
  10. 10. 1010 The implementation challenge: governance is key § The absence of national binding targets raises question on the implementation of the 2030 Framework and consequently brings the issue of governance into the spotlight. § A Governance structure could ensure the achievement of targets and bring certainty to investors § Anticipating the issue that could arise from the absence of national binding targets, the Commission proposed a potential governance scheme based on national plans for competitive, secure and sustainable energy § Adoption of Council Conclusion on the governance system of the Energy Union, in November 2015, three main elements: 1. Integrated national energy and climate plans for the period 2021 to 2030 2. Transparent reporting system will be put in place, based on streamlined progress reports by Member States assessing the implementation of national plans and on key energy and climate indicators 3. Commission to monitor collective progress made in its annual State of the Energy Union and, if necessary, propose policy measures to ensure the delivery of the Energy Union objectives
  11. 11. 1111 Governance continued § By the end of 2016, Commission will present a legislative proposal on Energy Union governance: § Specify the political process between Member States and the Commission § Address the need to streamline planning, reporting and monitoring requirements without adding administrative burden § Ensure consistency between the various planning and reporting streams in the energy and climate field (ongoing stakeholder consultation). § Governance structure based cooperative approach? § Possible “first past the post” approach § What about consequences of a lack of compliance of Member States? Policy measures to step up implementation but will there be sanctions? § Loose governance and excessive flexibility is not without danger, it can lead to a fragmentation of national policies and impede the construction of a single market for energy
  12. 12. 1212 Examples of flexibility leading to fragmentation § The following are just a few examples of how flexibility can lead to fragmented implementation, which does little to promote the internal energy market and the fulfillment of the Energy Union goals. § ETS – cost pass through § Energy Efficiency – Obligation Schemes § Renewables – State Aid issues
  13. 13. 1313 Next Steps for 2030 § ETS post-2020 (phase 4) revision has started, deliberations expected to end some time in 2017 § Non-ETS (effort sharing decision) expected to launch before Summer (June 2016) § Energy Efficiency Directive and Energy Performance of Buildings Directive proposals expected to launch after Summer (September 2016) § Renewables and Market Design proposals expected to launch before the end of the year (November 2016)
  14. 14. Contact us Office Address Office PhoneNumber Office Email Contact us Office Address Office PhoneNumber Office Email Thank you! c c

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