Energy Union is about re-inventing our economy

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Maroš Šefčovič calls 2017 "the year of implementation". [European Commission]

The European Commission’s Winter Package of Energy Union laws will be a turning point for clean energy, writes Maroš Šefčovič. But the spirit of the package goes further than clean energy or tackling climate change – it’s also about economic transformation, he argues.

Maroš Šefčovič is vice-president of the European Commission, in charge of the Energy Union.

After 300 hundred years of industrialisation, our European society is moving towards low-impact, sustainable existence. While our GDP has grown by 50% since 1990, our emissions fell by 22%.

This means we have successfully decoupled emissions from our economic growth, we have proved there isn’t a trade-off between the two objectives.

More importantly, the realisation that climate change may cause in future a much larger recession than the 2008 global recession is gaining traction globally. After all, in the 21st century we have experienced nine of the ten warmest years on record, with 2016 being the hottest yet.

Ironically, 2016 has been the most successful year yet in the fight against climate change. And the entry into force of the Paris Agreement and delivery of our “Clean Energy for All Europeans” package convey the strong resolve of 2016 very well.

With this package we have proposed 90% of what we announced in the 2015 Framework Strategy for a Resilient Energy Union. This is why I called 2016 the year of delivery. And this is why I call 2017 the year of implementation.

The “spirit” of this package is that not only will this enable us to reach our climate and energy targets – but that it is fundamentally also a tool to modernise our industrial and economic fabric, to the benefit of our citizens.

It’s a change of paradigm where we want to move from centralised fossil fuel systems to a more decentralised, decarbonised, democratised, diversified, digitalised and disruptive model.

Therefore this is not only about energy, or fight against climate change, this is about re-inventing our economy, its sources of growth, jobs and welfare. The fight against climate change makes also a very strong business sense.

If we reach the commanding heights of the global energy transition race, new commercial opportunities will open up bringing more green jobs to Europe whilst modernising our entire economy and helping to “save our planet”.

In the past two decades digitalisation came almost simultaneously with major advancements in renewables and in transport. These breakthroughs constantly challenge traditional business models. And governments need to help businesses to buy into the learning curves of immature sustainable technologies and to capitalise on vast comparative advantages we already have in Europe.

The response of the European Commission to this urgent responsibility is epitomised by its Strategic Energy Technology Plan (SET Plan). It coordinates member states in the pursuit of ten enabling technologies; to reduce the cost of renewables and improve their integration, to develop smart homes, and more generally increase the smartness of our energy system, to enhance the uptake of energy efficient solutions for buildings, to improve the cost effectiveness of our industry, to strengthen our energy options for sustainable transport, to become competitive in the battery sector, and step up R&I activities in carbon capture, storage and use, and increase nuclear safety.

This year will mark its jubilee year and ten years of constant efforts to mobilise efforts of the innovation community. In SET Plan we have set ambitious R&I targets to inspire cost reductions, performance improvement and worldwide deployment.

To achieve these targets, we are bringing higher education, research and business closer together within the innovation community circle, as discussed at the SET Plan Conference in Bratislava in November last year.

By supporting these breakthrough technologies everyone will benefit from cheaper utility bills, better energy services, cleaner air and better quality of life. Without the SET Plan, and other initiatives like Horizon 2020, our response to climate change would be limited; at a time when action is needed the most.

In view of the progress achieved in driving this multi-faceted transformation to a more sustainable economy, we have recently presented the State of the Energy Union. We evaluated where we are and what still needs to be done to deliver an Energy Union that serves the varying needs of 28 member states.

We have also reflected on the progress of energy innovation and the next steps ahead. We have set out the political priorities for the year 2017. And because we want the Energy Union to have a strong social and external dimension, on top of making the economic modernisation process sustainable, we will keep pursuing a socially fair transition domestically and enhancing Europe’s competitiveness and global leadership on climate action abroad.