European Commission Announces 2030 Climate, Energy Goals

23 January 2014

The European Commission unveiled its 2030 climate and energy policy framework on Wednesday, calling for a 40 percent greenhouse gas (GHG) reduction target below 1990 levels and an EU-wide binding renewable energy target of at least 27 percent.

While the GHG target is below the level some experts and green groups had called for, European Commission President José Manuel Barroso told journalists in Brussels that the target was both "ambitious and affordable."

Barroso situated the package in the context of international negotiations under the UN Framework Convention on Climate Change (UNFCCC), which is aiming to achieve a global climate agreement by the end of 2015. UNFCCC Secretary-General Christiana Figueres welcomed the announcement, saying on social media site Twitter that the "EU Commission keeps EU on track."

EU Energy Commissioner Günther Oettinger has said that the framework will balance climate goals with the need to keep energy costs down. A recent Commission report indicated EU energy costs are twice those of the US - sparking competitiveness concerns in the growth- and jobs-hungry continent.

The 2030 package will succeed the bloc's "20-20-20" goals - which set emissions reduction, renewables, and energy efficiency targets for the end of this decade. Current estimates suggest the EU is likely to fall short of meeting the energy efficiency objective - the only non-binding 2020 goal.

Reforming the ETS

The announcement also included a legislative proposal for a market stability reserve under the EU's Emissions Trading System (ETS), which has faced major difficulties in recent years.

Earlier this month, member states signed off on a plan to withhold up to 900 million carbon permits until 2019-2020, designed as a temporary solution. (See Bridges, 16 January 2014) However, commentators have long called for a more systemic reform of the ailing cap-and-trade system, after years of depressed global economic activity generated a glut of allowances and basement trading prices of under €5 per metric tonne.

In this context, the Commission has recommended the creation of an "automatic stabiliser," which would be put in place by 2021. The mechanism would adjust the supply of allowances in the EU carbon market to be auctioned, operating independently under pre-defined rules.

The framework also proposes an annual linear reduction after 2020 in the "cap" on emissions covered by the ETS of 2.2 percent - now at 1.74 percent - in an effort to strengthen the trading scheme and carbon prices.

Prior to Wednesday's announcement, environmental groups had called for measures such as setting an expiry date on the surplus permits, or the creation of a "carbon central bank" that would alter prices according to fluctuating conditions.

Renewables disagreement

A binding renewable energy target of 30 percent had been bounced around during the consultation period. Wednesday's announcement indicates that the new, lower figure will not be translated into binding national targets, leaving room for national preferences and circumstances.

EU Commissioner for Climate Action Connie Hedegaard has said that without this flexibility, the proposal would be "dead as of today - politically speaking."

Tensions ran high in the months prior to the framework release, as member states battled for different 2030 outcomes. Late December saw ministers from eight EU member states - including France and Germany - forward a letter to the Commission calling for "robust" renewable energy targets.

Back in June, British Energy Minister Ed Davey championed an ambitious "GHG cuts only" approach, stating "countries should be free to pick the energy mix they prefer." His position was shared by the governments of Poland and the Czech Republic.

The European Parliament weighed in on the debate earlier this month. A vote in the environment and energy committees on 9 January backed the renewal of Europe's three-pronged target approach through the end of 2030.

An energy efficiency target was not included in the release. Under the 2012 Energy Efficiency Directive (EED), a progress review towards the 2020 target will be carried out by June 2014 and the 2030 goal will not be set until after this date.

The Commission's communication will now be subject to scrutiny prior to endorsement by the bloc's leaders, possibly at the next European Council meeting in March. Once secured, a legal proposal will start its journey through the EU's legislative bodies.

ICTSD reporting; "Big EU guns fire for ‘crucial' 2030 renewable targets," EURACTIV, 7 January 2014, "MEPs call for binding 2030 climate targets," EUROPEAN VOICE, 9 January 2014, "State aid row engulfs UK shale gas plans," EURACTIV, 17 January 2014, "EU to ditch transport emissions goals beyond 2020," REUTERS, 16 January 2014, "UK, Czechs call for nuclear-friendly 2030 energy policy," EURACTIV, 17 January 2014, "Parliament, Commission set for clash over 2030 clean energy goals," EURACTIV, 10 January 2014, "Europe opts for ‘auto-backload' of carbon markets," EURACTIV, 21 January 2014.

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