In effect overall European countries emissions have to be reduced by 10% by 2020
EU officially adopts climate and energy package
The EU has finalized its plan on how to deal with climate change and energy security. Yesterday, the EU Parliament officially approved the climate and energy package as agreed by EU leaders at last weeks summit.
The package includes legally binding targets to cut GHG emissions by 20%, establish a 20% share for renewable energy, and improve energy efficiency by 20%, by 2020.
With all 785 elected MEPs present in Strasbourg, Parliament voted overwhelmingly in favour of the package with 610 votes for and 60 against amid 29 abstentions.
The climate and energy package include deals on six main proposals: energy from renewables, amendments to the EU’s emission tradingscheme, how to distribute reduction effort in the non-traded sector, reducing emissions from new cars, CCS, and transport fuel quality (see Commission’s Q&A on each of the proposals).
The main agreements in each area are as following:
-The Renewable Energy Directive: sets legally binding targets for each Member State, in order to reach an overall EU target of 20% share of renewable energy by 2020, as well as actions to remove administrative barriers and other burdens. It also includes the 10% target for renewables in transport.
-EU ETS: As from 2013 an emissions cap will be set at EU level and will be cut each year to reach a 21% cut in 2020, while increasing the level of auctioning in the system. Overall, more than 50% of allowances will be auctioned from 2013, and the proportion will rise each year. Member States are recommended to use at least half of their auctioning revenues on measures to combat climate change.
Industrial installations not subject to carbon leakage will be required to buy 20% of allowances in 2013 rising to 70% in 2020 and 100% in 2027. Operators at risk of carbon leakage that invest in the most efficient technologies will receive allowances for free in accordance with a benchmark based on best available technology. Offset credits will be allowed but the amount will have to be below half of the reduction effort.
-Effort sharing: small-scale emitters in sectors including transport, buildings, agriculture and waste, (some 60% of total GHG emissions in the EU) will have to reduce emissions by an average of 10% compared to 2005 by 2020. Two thirds of their reduction commitments could come from ‘offset credits’.
-CCS: a Directive on carbon capture and storage will provide the legal framework needed to further develop this technology. 300 million allowances from the EU ETS will also be made available for funding 12 commercial pilot projects.
-Emissions from new cars: new binding emission targets are set to ensure that emissions from the new car fleet are reduced to an average of 120g CO2/km by 2015 ( a phasing-in of the target will start in 2012).
-Fuel Quality Directive: It will place an obligation on suppliers to reduce GHG from the entire fuel production chain by 6% by 2020. A review in 2012 will consider increasing the ambition level to a 10% greenhouse gas reduction by 2020.
Critics of the climate and energy package
Strong criticism to the revised package came, as expected, from environmental NGOs who raising questions regarding its ‘environmental integrity’.
They argue that in exchange for a deal, the EU’s ambitions were watered down through concessions aimed to reduce compliance costs for heavy industry and coal dependant power sectors, following pressure by Germany, Poland and other eastern European countries.
Most of the criticisms were directed at the fact that too many free emissions allowances were still to be handed out, and that the package allows EU countries to “offset” a substantial part of their carbon reductions.
