EU 2030 climate and energy framework: the reaction

The European Commission is aiming for a 40 per cent carbon emissions cut and renewable energy to make up 27 per cent of the mix EU-wide in 2030. Reaction has been flooding in.

Ed Davey, UK energy secretary, said the targets were a “step in the right direction”.

He added: “They provide the flexibility to tackle climate change in the most cost-effective way, so that British consumers aren’t paying over the odds to go green. This package backs the green growth agenda I’ve been working for with other European colleagues.

“A 40% GHG target for Europe is a good start which the UK fought hard for, and will lead to massive investment in low carbon energy, including many more renewables.

“Yet Britain has been clear that Europe must be ready to adopt a 50% target if the rest of the world is prepared to sign an ambitious global climate deal in 2015.”

SSE also said “important steps had been taken” towards reviving the EU ETS.

Martin Pibworth, managing director of energy portfolio management at SSE, said:  “Today, very important steps have been taken towards reviving the EU ETS in the interests of the cost-effective decarbonisation of Europe. Following on from backloading, the proposed EU ETS reforms are positive measures which will help the EU ETS provide a stable and robust investment signal for low carbon investors.

“However, the detail of how the market stability reserve will work is crucial in determining how long it will take for the EU ETS to become the central driver in carbon abatement decisions across Europe, as well as whether further measures will be required to deal with surplus allowances expected to be on the market when the mechanism is introduced.”The Renewable Energy Association and the Solar Trade Association expressed disappointment at the lack of specific renewable targets for member states. They urged the UK government to create an ambitious national plan.

Prof Roger Kemp, fellow of the Institution of Engineering and Technology (IET), said: “While we already have our own UK carbon reduction and renewables targets, for 2020 and 2050, the new EU targets are useful as they put a peg in the ground for what we want to achieve in the interim between the two UK target dates.  It should help us – and the other EU nations – to justify investing money in carbon reduction measures and technologies.

“For the UK, the proposed EU 40% reduction in carbon emissions and 27% increase in renewables is a big challenge.

“The lowest cost, but not always the easiest, carbon savings come from avoiding energy use and using energy more efficiently.  Perhaps this change will rebalance policy more in this direction.”

Nina Skorupska, chief executive of the REA, said: “We’re about to find out what happens when theoretical economics meets the real world. Theory suggests a ‘technology neutral’ approach is economically efficient. But experience shows that binding renewables targets do two things: First, they give a major long-term boost to investor confidence, helping accelerate market growth and technology cost reduction. Second, politics frequently trumps economics in the real world, and when politicians go wobbly on renewables, the targets help keep investment flowing.

“New binding targets for member states would accelerate the cost reduction potential that is unique to renewables. Renewable generators are smaller and more numerous than fossil and nuclear generators, so the combination of greater competition and mass production leads to major cost reductions – as well as more jobs, community participation and greater resilience. Many renewables will be cheaper than nuclear well before 2030, and will be cost-competitive with fossil fuels – and no longer require subsidy – sooner with binding targets than without.”

Leonie Greene, STA head of external affairs, said: “It is something that Europe has agreed a 40% emissions reduction target, albeit not high enough, but renewable energy stands at the heart of achieving this. From a climate perspective Europe needs to expedite, not slow, renewables deployment. From an economic perspective weakening ambition is nonsensical given the massive investments in renewables our international competitors are making. The 27% renewables target is no more than the Commission expects under business as usual, so the Council and Parliament must improve this significantly if it’s to have any meaningful effect.”

The Carbon Capture and Storage Association hit back at a target for renewables in the absence of one for other low carbon options.

Luke Warren, chief executive of the CCSA, said: “It is absolutely critical that Europe sets an ambitious target for emissions reductions for 2030. This must remain the cornerstone of the EU’s response to climate change and will be vital in driving future investment in all low-carbon technologies, including CCS. We strongly support the UK’s position that anything less than a 40% target will not be sufficient.

“We are extremely disappointed that the Commission has recommended a dedicated renewables target. We have seen from the existing 2020 package that a renewables target disproportionately drives investment into renewables and disadvantages other low carbon technologies such as CCS.

“We strongly recommend that this renewables target is either dropped or expanded into a ‘sustainable energy’ target which includes CCS. This would provide member states with the flexibility to meet targets at the lowest cost to consumers.

“If Europe is to decarbonise at least cost, member states must have flexibility in how they meet targets. We cannot afford a dedicated renewables target; CCS must be an integral part of the mix.”

Martin Schoenberg, head of policy at Climate Change Capital, the environmental investment management and advisory group, said: “A 40% reduction target is the minimum necessary to signal continued political commitment and provide greater certainty for the energy industry and its investors. The European economy is on track for a 32% CO2 reduction by default.

“European leaders need to endorse the 40% target to tackle the carbon bubble. Overvaluing high carbon assets will come to an end when we realise the behaviour of these companies cannot continue and institutional investors will realise their assets are in the wrong place.”

Oxfam said a 40 per cent reduction in carbon emissions was not enough.

Lies Craeynest, Oxfam’s EU climate change expert, said: “The European Commission is gambling with our future. The proposed 40% target would scupper any hopes of keeping temperatures below the 2 degree danger level. With such lamentably low ambition, the Commission is dramatically increasing the odds of a future global food crisis.

“Shamefully, Commission President Barroso has put the interests of the fossil fuel lobby above all others. Progressive business leaders who understand the serious threat that climate change poses to people and the economy must now make sure European governments demand a much bolder 2030 EU climate package.”

WWF also said the package did not go far enough.

Jason Anderson, head of climate and energy, WWF European Policy Office said: “After months of anticipation, the Commission has repackaged a slowdown in the current pace of emissions cuts and renewable energy deployment, and called it ambitious. It is putting Europe’s economic modernisation at risk.

“The picture painted by the full set of policy proposals is dispiriting – an energy efficiency target has been deferred; cancelling the massive oversupply of carbon in the Emissions Trading Scheme is also deferred; closing the gaps in EU shale gas legislation is deferred. I’m sure the fossil fuel lobbyists will sleep well tonight.

“It is now up to Member State governments to show the political leadership needed to inspire Europe towards an industrial and economic revolution that will provide for both people and the planet.”

Sustainability think-tank E3G also backed stronger action.

Nick Mabey, chief executive of E3G, said: “With these weak proposals, the European Commission has failed to deliver science-based proposals needed to keep the world within 2 degrees of warming. This will stifle investment and reduce the competitiveness of the European economy.

“European Member States must now fill the gap left by the Commission and agree a stronger package in March that addresses the realities of climate risk and protects the fundamental interests of European citizens and businesses.”

Manufacturers’ body EEF welcomed the recognition of a need for industrial competitiveness but opposed the inclusion of an EU target for renewables.

Gareth Stace, head of climate & environment policy at EEF, said: “It is promising to see the European Commission starting to place climate change policy and industrial competitiveness side by side in its consideration of a package of measures out to 2030. The Commission’s report on energy prices highlights the scale of the problem of rising energy prices for European industry whilst the Industrial Renaissance communication acknowledges that the task of tackling the issue must be at the forefront of any industrial recovery in Europe. The Commission must now follow up this acknowledgment with meaningful action on a range of issues including reform of the EU ETS, developing a pathway to reducing public support for low carbon electricity generation, completion of the internal energy market and reform of state aid rules with regards to compensation for energy costs.”

Richard Warren, senior energy & environment policy adviser at EEF, said: “Whilst it is promising to see the Commission will not be setting individual MS targets for renewables, we are worried that the inclusion of an overarching EU target for renewables sends a confusing signal. It would have been preferable to see a clear line from the Commission on this issue demonstrating that the precise route to emissions reductions is a matter for individual member state discretion.”

A group of leading businesses including Unilever, Skanska, BT, Acciona, EDF Energy, Shell, Philips, Lloyds, and Kingfisher welcomed the White Paper.

Paul Polman, chief executive of Unilever said: “A 40 per cent target is a minimum level of ambition if we are to tackle climate change and deliver sustainable growth in the long term.  We hope that other countries will follow Europe’s lead in developing their own ambitious targets.”

EnergyUK said: “The key objective should be for the EU to reduce carbon, with each country deciding how to meet the targets. Different countries have different views on how they want to generate electricity and so bringing about carbon reduction in a way that allows for national discretionary is essential. This also has the ability to keep down the additional costs on both households and industry. The focus for policy makers in the EU and the individual nations, must be on affordability and energy security.”