New European Commission emissions reduction proposals fail to prioritise energy efficiency

Key new European Commission climate proposals, covering 60 per cent of EU greenhouse gas emissions, fail to match the aspirations of the Paris Agreement to keep global warming well below 2°C, and include astonishing “loopholes”, especially on energy efficiency, analysts say.

This autumn, the European Commission will present an Energy Efficiency Package, including a revision of the Energy Efficiency Directive and Energy Performance of Buildings Directive. The revision aims to implement a non-binding energy efficiency target of 27 per cent by 2030, which the European Commission is considering increasing to 30 per cent.

In addition, the post-2020 reform of the EU Emissions Trading System is being negotiated in the European Parliament, and on 20 July the European Commission published proposals on the Effort Sharing Decision, the idea of which is to distribute climate targets to each Member State in order to decarbonise the sectors not covered by the EU-ETS, which include transport, buildings, agriculture and waste.

The overall target is in keeping with the same 30 per cent reduction on 2005 emissions levels by 2030.

The European Parliament called in October 2014 for a comprehensive cost-benefits analysis of energy efficiency and insisted on a binding energy efficiency target of “at least” 40 per cent by 2030 in order to reach 90-95 per cent reductions by 2050. WWF criticised these targets for being far too weak at the time.

Yet, these new proposals – from the bureaucrats in the Commission – only consider a target of 27 per cent (having in mind an EU level of 30 per cent) for energy efficiency.

They are so weak that six EU member states do not need to cut greenhouse gas emissions from transport, waste, buildings and farming for 15 years. Greece, Hungary, Croatia, Bulgaria, Portugal and Romania were already emitting less than their 2030 allocation in 2014.

The weakness of this ambition has been slammed by the Coalition for Energy Savings.

“Energy efficiency improvements are the key driver of such emission cuts but the link is not made clear,” it says.

The Coalition for Energy Savings secretary general Stefan Scheuer said: “Building national climate targets on the potential for efficiency would secure benefits to all Member States, especially lower-income countries with significant investment gaps.

“The Commission should step up efforts to truly place energy efficiency first in its policymaking, which will benefit citizens directly, through renovating inefficient buildings, replacing wasteful equipment and technologies, updating production facilities and building an efficient and clean mobility system.”

The previous Effort Sharing Decision included an implicit target to reduce greenhouse gas emissions of the building sector. But this was not supported by an EU requirement to set an energy savings target for buildings. This oversight has not been corrected in the new ESR.

Another organisation condemning this oversight is Eurima, which represents insulation manufacturers. It says: “This lack of focus on sectors with high available CO2 potential, namely our existing buildings, is regrettable, especially since there are mature technologies in place to renovate and curb emissions.”

The Commission’s proposals offer Member States the possibility to bank and borrow emission allowances, and loosen the reporting/compliance measures currently in place. A formal compliance check will be organised only every five years, rather than annually.

To meet the Paris Agreement goals, around half of global emissions reduction efforts will have to come from energy efficiency, says Eurima.

“The ESR fails to encourage or provide any incentive to prioritise energy efficiency in facilitating investment in managng energy demand, through a higher energy efficiency target.”

The proposals have been analysed by Sandbag, a UK-based not-for-profit climate policy think tank. Sandbag says” “This proposal … has more loopholes than anyone expected and will not deliver Europe’s contribution to the Paris Agreement.”

Sandbag believes that 50 per cent cuts are achievable and can be delivered cost-effectively. The 30 per cent target implies just a four per cent cut in emissions beyond BAU between 2021-2030 and the sharing proposals “would allow a flood of emission credits from elsewhere to dilute the EU’s climate ambition”.

It has published its own report showing how effort could be shared in a more balanced way. “Wealthier states with higher targets but smaller cost-efficient reduction opportunities could pay countries with lower GDP/capita to cut their ESD emissions exactly where cost is lowest,” it suggests.

The Commission is proposing that the number of carbon emission allowances will decline by 2.2 per cent every year starting from 2021. (Currently there’s a 1.74 per cent annual reduction; Green MPs in the European Parliament demanded a 2.6 per cent decline).

In order to prevent “carbon leakage” – where factories move abroad to escape the restrictions – the Commission wants to see 57 per cent of allowances auctioned and allocate the remaining 43 per cent given away free.

Eastern European countries like high coal-burning Poland had demanded this in return for agreeing to the EU’s climate targets in the first place.

Germany’s target is a cut of 38 percent and France’s and Britain’s is 37 per cent. Brexit could affect the other countries’ targets, but not by that much by 2030. Poland’s target is just a seven per cent cut.

Poland objected to its target straightaway.

“Poland cannot afford such a big reduction effort,” Pawel Salek, Poland’s deputy environment minister in charge of climate policy, said in an email.

But European Commission Vice-President Maros Sefcovic told Reuters that “all member states understand very well that if you want to alleviate the burden on one country, then someone else will have to carry it”.

Imke Lübbeke, head of climate and energy at the WWF European Policy Office, said: “It seems baffling that the Commission can so quickly ignore the Paris Agreement and its temperature goals, especially since Climate Commissioner Arias Cañete has been openly endorsing 1.5°C as the temperature threshold to aim for.”

Yet this bickering about responsibility amongst nations is the reason for the low ambition of these proposals.

“Europeans want climate action: it is now up to their political representatives, MEPs and Member States to put the “effort” back into Effort Sharing Decision by closing the loopholes and introducing a five-yearly review that increases ambition over time, in line with Paris,”, Lübbeke said.

Europeans may want climate action, but clearly those lobbying the EC do not.

You can watch Cañete announce the proposals here:

David Thorpe is the author of:

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