Driving Europe’s energy transition via policy

Ten days after taking office in December 2019, the new Von der Leyen Commission announced the European Green Deal – raising our ambition to become climate neutral by 2050. At that time the initiative was seen as a bold proposal. Now, nearly two years later, this ambition of achieving “net zero” by mid-century – and the step of reducing greenhouse gas emissions by 55% by the end of this decade – is already written into EU Law. The question is no longer if we should set such a bold target, but how we can achieve it. This summer we presented one of the biggest policy packages in Commission history aimed to deliver the European Green Deal.

The Commission presented more than a dozen concrete legislative proposals to translate our climate goals into action. Getting to net zero is only feasible through a fundamental transformation of our entire society, so we must use all the tools at our disposal and make sure they complement and reinforce each other.

We have put the price on carbon and we propose to extend this proven system to new sectors that are lagging behind: aviation, shipping, road transport and buildings. We will set new and higher targets to push for change – be it in agriculture or industry. We will apply stricter standards, for example for cars and vans. And we will make it easier to be green and less rewarding to use fossil fuels, through taxation and other policy measures.

While this is a multi-faceted package of proposals covering many policy areas, energy remains at the heart of our climate ambition. Three-quarters of EU’s emissions come from producing and using energy, so without a green energy transition, there will be no net zero.

On paper, the task can be summarised in one sentence: we must use less energy and what we do use, should largely be from renewable sources. This is, of course, much easier said than done. Energy systems are complex and costly and resistant to change. Infrastructure projects take notoriously long to complete and in some sectors, green solutions are not yet available. Therefore, we need to create the conditions where the changes that we need can happen and happen fast.

The legislative package we published in July contains two dedicated energy instruments: the updated renewable energy directive and the energy efficiency directive, the core tools of EU energy policy.

In the light of our new climate goals, we have to be considerably more ambitious than before. The progress we make in the coming decade will be crucial. We need 40% of renewables in our energy mix by 2030, not 32% as is the current target. And in terms of energy efficiency, we need to save 9% more energy than we would under the existing directive.

When it comes to renewables, the revolution has been in the air for quite some time. In Europe, we are already on course to beat our current 2030 renewables target by a comfortable margin. In many places, renewable energy is now the cheapest option to generate electricity and over the last seven years, more renewable power has been added to the global grid than fossil and nuclear energy combined.

European industry is a global leader in this sector, particularly in offshore wind, thanks to pioneering efforts in the last three decades. So while the necessary roll out will be a huge challenge, it also presents a huge opportunity for our economies to take advantage of our favourable position.

While energy efficiency goals have been more challenging to achieve so far, the pressure on energy prices has made the need to save more relevant than ever. Energy efficiency is the only long-term solution to energy poverty and using less energy will have a welcome effect on the energy bills of every person and business.

I am fully aware that updating two directives is not enough to transform the European energy system – although the changes we propose go much deeper than just increasing the targets. Much of the necessary work was already done last year with our strategies for energy system integration, hydrogen, the renovation wave and offshore renewable energy. We also proposed new rules for the trans-European energy networks, putting the focus firmly on green energy and grids.

But the work is of course not done, and there are several important initiatives still to come this year, focusing on some key sectors.

Buildings consume around 40% of energy in the EU and we have set ourselves a goal to reduce buildings’ energy-related emissions by 60% compared to 2015. To contribute to this, we will, by the end of the year, review the Energy Performance of Buildings Directive.

In the same timeframe, the Commission will present proposals to decarbonise the EU gas market, including measures to boost clean hydrogen.

While natural gas has a role to play in the transition to phase out more polluting fuels like coal and lignite, it is clear that by 2050, it has to be largely replaced by clean gases like renewable hydrogen or biomethane.

Finally, we will tackle the emissions of the most potent and second-most important greenhouse gas – methane. This is also an important priority for our global energy policy, as most of the venting and flaring takes place outside Europe. And action here is especially urgent as methane is particularly dangerous in the short term.