Time for an EU climate policy 2.0?

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV Media network.

The EU could dramatically cut transport emissions by demanding all commercial fleets to be electrified by 2025. [Ged Carroll/Flickr]

The European Commission will soon release its second annual report on the State of the European Energy Union. This is a pivotal moment in the EU’s political calendar, write Teresa Ribera and Thomas Spencer.

By Teresa Ribera is the director of IDDRI and Thomas Spencer is the climate programme director at IDDRI, the French Institute for Sustainable Development and International Relations, a non-profit policy research institute based in Paris.

It is time for the EU to take stock and assesses its progress towards its energy and climate policy goals. One of the key questions the Energy Union report will address is whether the EU is on track to reach its emissions targets for 2030 and 2050?

At first glance, this may seem like a strange question to ask. The EU’s greenhouse gas emissions are 24.4% below 1990 levels, meaning that the bloc is tracking well ahead of its emissions target for 2020. Surely then, the EU is tracking ahead of where it needs to be to reach its 2030 objectives, a step on the way towards deep decarbonisation by 2050?

The EU has made tremendous progress in transforming its energy system. Carbon emissions per unit of electricity production dropped by 22.9% between 2000 and 2014, EU houses consumed 21.2% less energy per m² in 2013 than in 2000, EU passenger transport consumes 8.7% less fuel. This represents real and significant progress in changing the fundamentals of the EU energy system.

But the EU and its member states are lagging behind the necessary rate of transformation on numerous indicators if they are to reach the objectives of reducing emissions by 40% by 2030 and at least 80% by 2050. Even in the electricity sector, where the growth of renewables has been impressive, the improvement of carbon intensity needs to accelerate from about 1.8% per year to around 3% per year in the coming decade. In transport too, the EU is falling behind. The energy intensity of passenger transport is improving only about 0.8% per year, compared to the roughly 1.8% required in the coming decade to reach the EU’s 2030 and 2050 targets. And in industry, much of the change we have seen has been driven by crisis-induced structural changes, and not by cleaner technologies.

It is time for an EU Climate Policy 2.0. The EU ETS needs to be urgently strengthened to ensure a strong and effective carbon price becomes an immediate factor in current private sector decision-making. The Commission’s proposal for member state targets for sectors not covered by the EU ETS would go some way to putting the EU back on track.

But while these policies set targets and cap emissions, they are not enough to drive the structural change the energy system needs. They set the direction but do not change the gears. A much more ambitious suite of policies is required going forward.

The EU’s current energy savings goal of 27% is insufficient and its achievement is too influenced by the post-crisis shift to the “new normal” of slower growth. It should be dramatically increased, well beyond a 30% improvement by 2030. The EU needs a suite of new breakthrough policies on clean mobility. For instance, alongside an ambitious emissions performance target of at least 70g CO2 per kilometre by 2025, the EU should establish a framework for public and commercial fleet procurement to be 100% electric by 2025. On industry, the EU should set sectoral targets for the production and consumption of low-carbon steel and other energy intensive goods, in order to boost the decarbonisation of industry.

This is simply what is required by 2030 to be on the path towards deep decarbonisation, and hence to take the achievement of the EU’s 2050 objective seriously.

The EU’s climate leadership has driven innovation and enabled progress around the world. After the entry into force of the Paris Agreement, the EU’s top priority should be to accelerate the transition at home. For this, we need an EU Climate Policy 2.0, more focused on driving structural change in the energy system and less on emissions, the symptom of the problem and not the cause.

IDDRI on Wednesday (8 November) released the study State of the Low-Carbon Energy Union: Assessing the EU’s Progress towards its 2030 and 2050 Climate Objectives together with seven other research institutions from six EU member states (E3MLab/ICCS (Greece), ENEA (Italy); UCL (United Kingdom); ENERDATA (France); Grenoble Applied Economics Lab (France); Wise-Europa (Poland); Wuppertal Institute (Germany).

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