Posted on November, 30 2016

With the release today of its “Clean energy for all Europeans” package [1], the European Commission has outlined a very extensive set of reforms to the EU’s energy system. But it has failed to show bold and decisive leadership on renewable energy and rise to the challenge of the Paris Climate Agreement. “The EU led the world on climate change. And the world has followed as the need for action becomes ever more urgent. But the Commission’s clean energy package is still too dirty. Far from accelerating the energy transition the proposals leave the door open to subsidies, undermine support for renewables, and miss some big opportunities on energy efficiency. The Commission also seems to think that a good way of tackling climate change is to burn more trees," said Imke Lübbeke, Head of Climate and Energy at WWF European Policy Office. “It is now up to the European Parliament and to the Council to add some backbone.  Without that, Europe will undermine the progress it has already made and miss out on the huge benefits that the energy transition bring, for our economies, our job opportunities, and our health.” 30% Energy Efficiency target for 2030: EU can do better    Raising the energy efficiency target from 27% to 30% and making it binding  - as proposed by the European Commission today - is a step in the right direction. Although the target is binding only at the EU level, without national binding targets, it shows the Commission has understood the need for a stronger efficiency policy to give more confidence to investors for the next decade.

It is now up to the European Parliament to take Commission’s proposal a step further and, in line with its previous position, support a 40% efficiency target when negotiating the Energy Efficiency Directive with the Council. By adopting a more ambitious 40% energy efficiency target, instead of a 30% target, the EU citizens would reap significant benefits, such as saving up to 32bn Euros a year in the costs of health impacts from air pollution and 2.6m jobs. “A binding 30% energy efficiency target is the best Commission could do given current political circumstances, but it fails to maximise benefits for citizens or deliver an energy transition in line with the Paris Agreement,” commented Arianna Vitali Roscini, Policy officer for energy conservation at WWF European Policy Office. EC weakens support to renewables The ‘at least 27%’ target put forward by the European Commission today falls well short of what is required for the ambitious climate goals of the Paris Agreement. And without nationally-binding targets it is not clear how the Commission will ensure that the target is met - something that will clearly affect investor confidence.

Investors will also be put off by the general weakening of the EU’s support framework for renewables. Renewables look set to lose some of the priority they enjoy on EU markets and the Commission has decided to make it harder for Member States to support them.   The costs of renewables such as wind and solar have fallen dramatically, but the market will not invest in them at the pace or scale required without solid guarantees and/or the reforms to the EU market that would drive their uptake.

“The Commission’s draft proposals on renewable energy are puzzling. Less than a year since the Paris agreement, and with EU investment in renewables falling behind the US and China, the Commission has decided to put the brakes on”, said Alex Mason, Senior policy officer for renewable energy at WWF European Policy Office. “The proposals fail to provide a strong signal to innovators and investors in the EU’s green economy and risk leaving it to others to reap the benefits of the EU’s past investment. The Commission also seems to think that a good way of tackling climate change is to burn more trees.” Energy Markets have to match energy policies While the Commission has tried to block new dirty power producers from being paid through capacity mechanisms, these laws still leave the door open to subsidies for existing coal plants - at least until 2026.  What’s more, the Commission has failed to address the problem of overcapacity in many EU energy markets by, for example, proposing a programme of retiring the oldest and dirtiest power stations. Oversupplied electricity markets will not attract adequate investment in renewables, regardless of how competitive they now are.    “It is hugely disappointing that instead of maintaining the momentum of the Paris Agreement, these proposals reduce support for renewables and leave the door open to subsidies for coal. As this legislation is negotiated through the Council and Parliament, it is crucial that this dynamic be reversed,” said Adam White, Climate and Energy Research Coordinator at the WWF European Policy Office. EC bioenergy proposals, a prelude to another biofuels fiasco

The vast majority of future energy supply needs to come from wind and solar, not bioenergy. But instead of allowing those technologies to flourish, today’s proposals create big new incentives to use more bioenergy - and without any meaningful sustainability criteria. This means that we are likely to see further increases in types of bioenergy that offer few if any benefits over fossil fuels. There is a particular risk that the clearing of forests to provide chips and pellets for the EU energy sector - something that is already happening at an alarming level in the EU and in third countries - will greatly accelerate, even though on a 2050 timescale such an approach is likely to lead to higher emissions.

“On bioenergy, the Commission’s draft proposals are simply baffling. It doesn’t seem to have learned the lessons from the biofuels fiasco - or from the latest science - and instead seems to have decided that a good way of tackling climate change is to burn a lot more trees,” said Alex Mason. Energy Union Governance proposals: a good start Part of the winter package is a new Regulation on the ‘governance’ of the Energy Union, which brings together a wide range of planning and reporting obligations that are currently to be found in different sectoral pieces of legislation such as the Renewables Directive. The governance Regulation is also intended to be the mechanism by which the EU will ensure that its energy and climate targets are met. “On Governance, the Commission has made a pretty decent fist of integrating a wide range of different planning and reporting obligations”, commented Alex Mason. "The provisions on public consultation are a bit thin, we would have liked to have seen more detail on long-term planning, and there needs to be more clarity on how the Commission will enforce the 2030 targets, but overall this is positive step forwards.” ENDS Notes to the editors:

1. The European Commission’s energy package, whose aim is to help fulfil EU commitments under the Paris global climate change agreement, includes proposals to revise the Energy Efficiency Directive,the Energy Performance of Buildings Directive and the Renewable Energy Directive, as well as new proposals on the design of the electricity market and on the governance of the Energy Union.

Contact: Audrey Gueudet
Climate & Energy Senior Media and Communication Officer
WWF European Policy Office
agueudet@wwf.eu
Mobile: + 32 494 03 20 27