Implementing the Energy Union: Commission reports on energy transition progress
The Commission has published today a series of reports and documents accompanying the 7th State of the Energy Union report, published on 18 October. They highlight the progress made in implementing the Energy Union, covering issues such as competitiveness, energy subsidies and the achievement of the 2020 targets. They also look at the forthcoming updates of Member State National Energy and Climate Plans (NECPs), providing a template for the progress reports, due by March 2023, and draft guidance on how EU countries should update their plans by June 2023. This update exercise provides a unique opportunity to reflect the higher level of ambition for 2030 and take account of other developments.
In total, the Commission has published 2 Autonomous Acts, 5 reports, and an Implementing Regulation, summarised below.
With EU countries required to update their NECPs by June 2023, the Commission is offering them guidance on how best reflect the various policy changes that have been introduced in the past few years and increase their energy and climate ambition towards climate neutrality. Aimed at stimulating the necessary investment to achieve these targets by providing a stable framework until the end of the decade, the NECP updates should also reinforce the resilience and affordability of the energy system. EU countries are encouraged to carry out an ambitious and participative update of their NECPs, while strengthening regional cooperation. This Autonomous Act will be published as a Guidance Communication in all EU languages in due course.
This report highlights ways in which countries can work better together to achieve both individual and collective renewable energy targets, for example, focusing on renewables investment in areas with the greatest geographical potential. With many administrative issues hindering cross-border cooperation, notably on how to share costs and benefits, the document provides guidance on how to find mutually beneficial solutions to these issues. This Autonomous Act will be published as a Guidance Communication in all EU languages in due course.
Report on the achievement of the 2020 renewable energy targets
The report confirms that the EU reached a share of 22.1% of renewable energy in gross final energy consumption in 2020, thereby exceeding the 20% target set under the 2009 Renewable Energy Directive. For most of the decade, the overall share of renewables increased by 0.8 percentage points annually, but there was a much stronger increase of 2.2 percentage points between 2019 and 2020 due to the lower overall energy consumption seen during the COVID-19 pandemic. 26 EU countries achieved or exceeded their 2020 binding renewable energy target for 2020. However, there will have to be a steep increase in the deployment of renewables (tripling the 0.8% average increase) in order to meet the 45% EU target for 2030 proposed under the RepowerEU plan.
Report on the achievement of the 2020 energy efficiency targets
The report confirms that the EU reached its overall 20% energy efficiency targets for 2020 for both primary and final energy consumption, relative to forecast consumption levels, but this was heavily aided in 2020 by the COVID-19 pandemic. 24 EU countries reached their national contributions for primary energy consumption, and 21 for final energy consumption. For the cumulative energy savings target for 2014-2020 (under Article 7 of the Energy Efficiency Directive), data is only available for 24 EU countries, with 14 of them having met their energy savings obligation (and 10 of them falling short). The report warns that far more efforts are needed if the EU is to achieve a structural reduction in energy consumption and meet the proposed 2030 target of 13% (under the REPowerEU). With regard to long-term renovation strategies (LTRS), the analysis highlights the fact that some EU countries’ efforts will not be sufficient to fully decarbonise their building stock by 2050, and therefore further actions and higher ambition is needed. EU countries cost-optimal reports show that minimum energy performance requirements for buildings have progressively been strengthened over the last decade and made an important contribution to the improvement of the EU’s building stock, especially for new buildings. A comparison of the cost-optimal levels for 2013 and 2018 shows that a reduction of primary energy demand was observed for almost all building types in the EU countries.
Report on energy subsidies in the EU
This third annual report shows that overall energy subsidies (EUR 173 billion) in 2020 were 7% or EUR 14 bn higher than in 2015 – with support rising for renewables +15% to EUR 81 bn and energy efficiency +20% to EUR 15 bn, and falling 1.5% for overall fossil fuels (EUR 50 bn). Preliminary figures for 2021 show a further increase notably for energy demand issues and a drop in support for renewables. The report builds on an underlying study on energy subsidies and other government interventions in the EU.
2022 Progress report on competitiveness of clean energy technologies
The EU is at the forefront of clean energy research, with research and innovation (R&I) investment steadily growing. However, more public and private investments in clean energy research and innovation, scale up and affordable deployment are key to address the challenges and exploit the opportunities of the EU clean energy technologies. Although many funding dynamics are positive, structural barriers and societal challenges are still holding back EU-based climate tech scale-ups by comparison with other major economies. In 2022 the EU has confirmed its leading position in the global wind sector in terms of R&I, and it has confirmed its position as one of the largest markets for photo voltaic. Competition remains fierce, however.
The report shows that the introduction of tenders for renewables was a clear success for the EU, reducing the support costs (4.7% for solar and 14.0% for onshore wind), enhancing deployment, and providing a solid framework for technological improvement. This report builds on an underlying study.
Member States are required to submit, by 15 March 2023, their first progress reports on how their respective NECPs are being implemented. This regulation provides the format and technical details for these biennial progress reports