Energy and climate change: Towards an integrated EU policy[fr][de] 

The Commission opened a wide-ranging debate on a future European energy policy with the publication of a Green Paper in March 2006. The paper was published upon EU leaders' suggestion at the Hampton Court summit during the UK Presidency in autumn 2005 (EurActiv Links Dossier on Green Paper).

The need to act at EU level was prompted by mounting concerns regarding high oil and gas prices and worries about Europe's increasing dependency on a few external suppliers, as well as the global-warming crisis.

As a follow up to the Green Paper, the Commission unveiled a 'package' of energy and climate change proposals on 10 January 2007 in a move which, it said, would "set the pace for a new global industrial revolution" and increase EU resilience to future oil-price shocks.

EU heads of state and governments broadly endorsed the Commission's proposals at a landmark summit in March 2007, agreeing on a two-year action plan to launch a common European energy policy (EurActiv 13/03/07). 

Central to the summit agreement is a recognition that energy and climate-change policies should go hand in hand. It stressed the need for "decisive and immediate action" on climate-change and underlined "the vital importance of achieving the strategic objective of limiting the global average temperature increase to not more than 2°C above pre-industrial levels". To achieve this aim, EU leaders agreed to:

• a binding target to slash the EU's greenhouse gas emissions by 20% in 2020 compared with 1990 levels. EU leaders agreed that the objective should be pursued "unilaterally" even if there is no international agreement on reducing greenhouse-gas emissions after 2012 when the Kyoto targets expire;
• a commitment to to reduce emissions by 30% provided that other industrialised nations, including the US, commit themselves to comparable emission reductions and that "advanced developing countries" (i.e.: China and India) contribute as well in the framework of a post-2012 agreement.

To achieve these objectives, the summit endorsed an action plan to be implemented between 2007 and 2009. The plan's main elements include:

• Completing the internal market for electricity and gas (see EurActiv's LinksDossier);
• a binding target to raise the EU's share of renewables to 20% by 2020 (see EurActiv's LinksDossier);
• an obligation for each member state to have 10% biofuels in their transport fuel mix by 2020 (EurActiv 10/01/07);
• boosting energy efficiency  with a target to save 20% of the EU's total primary energy consumption by 2020 (see EurActiv's LinksDossier). New initiatives here include proposals for an international agreement on energy-efficiency standards for consumer appliances;
• aiming towards "a low CO2 fossil fuel future" with support for 'clean coal' technology, using carbon capture and storage deep underground (see EurActiv's LinksDossiers on clean coal and CCS)
• developing a common external energy policy to "actively pursue Europe's interests" on the international scene with major supplier, consumer and transit countries, including Russia;
• developing a European Strategic Energy Technology Plan to focus R&D efforts on low carbon technologies, and;
• on nuclear, the Commission chose to take an "agnostic" stance, leaving it up to member states to decide.

Since the 2007 EU Summit, the Commission has put forward two major legislative packages in respect of the action plan:

1. 19 Sept. 2007: The third 'package' of proposals to liberalise the EU's energy market (see EurActiv's coverage of the package and stakeholder reactions);
2. 23 Jan. 2008: The 'climate and energy package', which features legislative proposals on CO2 'burden sharing' and on the post 2013 period of carbon trading under the EU-ETS, revised EU state aid rules, a communication on carbon capture and storage (CCS), and a prosposed directive on renewable energies, including biofuels (see EurActiv's coverage on CO2 and EU ETS, renewables and stakeholder reactions).

Several EU business organisations (UNICE, Eurochambres) as well as the European Chemicals industry (CEFIC) criticised the Commission's unilateral CO2 reduction targets for 2020. "Further strong CO2 reduction targets that have not been adopted by other major emitting nations will weaken the European industry's competitiveness within the global business environment without achieving effective environmental benefits," said a CEFIC press statement.

Employers' organisation UNICE also warned of serious price hikes as a result of the Commission's proposals. "If the contribution of nuclear energy does not increase in the EU in the future," writes UNICE, "the increased demand for renewable energies will be such that their price will skyrocket, making the envisaged EU energy strategy virtually impossible to sustain."

The Commission's intention to continue its energy-market liberalisation, on the other hand, was welcomed by most industry groups such as the Union of the Electricity Industry (Eurelectric) as well as SME lobby UEAPME and the European Federation of Energy Traders (EFET). However the European Federation of Public Service Unions (EPSU) called the package a "PR exercise to justify higher energy bills and disguise failure of liberalisation". ETUC, the European Trade Union Confederation, also considered the "pursuit of electricity and gas market liberalisation to be 'reckless'.

Foratom, the nuclear industry lobby, expressed its satisfaction with the Commission's evaluation that "nuclear energy is one of the largest sources of carbon-dioxide free energy in Europe". It did not comment on the fact that the Commission leaves the decision on the future of nuclear in the hands of member states.

The lobbying groups for the renewable energy industry were less impressed. EREC, the European Renewable Energy Council criticised the Commission's "vague measures and ambiguous commitments". EREC Policy Director Oliver Schäfer said: "This energy package is another major step on the Commission's road to becoming the world leader in pure announcements and lip-service. In fact, for renewables it means a re-nationalisation of existing effective European legislation." ESTIF, the European Solar Thermal Industry Federation, complained that the Commission did not put forward a proposal on renewable heating and cooling.

CEPI, the European paper industry association, said that it supported the Commission's integrated view on climate change, energy and industrial competitiveness, describing it as "a big step in the right direction". However, it added that "by focusing solely on setting targets, the current debate on renewables is heading in the wrong direction". 

COGEN Europe regretted that the Commission does not give enough weight to co-generation, "the most immediate single source of both energy saving and CO2 reduction available in Europe today". 

The European electricity industry association Eurelectric is much more critical of the Commission's renewables targets. "The EU should avoid command-and-control measures such as binding energy targets or requirements to use only certain technologies," and questioned the "wisdom and the realism of the proposed dramatic compulsory increase in the share of RES (renewables) in the energy mix by 2020".

Environmental NGOs focused on the Commission's climate-change goals. The European Environmental Bureau (EEB) said that the package "lacks teeth". EEB chief John Hontelez called the EU greenhouse-gas reduction target "unacceptably weak" and the energy policy proposals "unconvincing and potentially even damaging, particularly regarding biofuels and nuclear power". WWF made similar comments, describing the EU energy revolution as "still a distant dream". Friends of the Earth Europe called the package "good news for the dirty energy industry, bad news for people and the planet".