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What’s at Stake as EU Leaders Sit Down to Hammer out the Next Batch of Energy and Climate Targets?

Dressed as corporate lobbyists, Friends of the Earth Europe and Oxfam constructed a huge blockade of leaky oil barrels and bags of coal, to symbolise the dirty energy companies blocking action on climate change. These polluting companies are spending millions every year to prevent the transition to a clean, community-controlled energy future. (Photo: FOE Europe/cc/flickr)

Renewables targets, gas wars, power outages and nuclear subsidies - possibly the biggest energy issues over the past few years and all linked in one way or another to deals made in the EU over the direction of the continent’s energy and climate policy.

Today EU leaders are sitting down to hammer out the targets for the next 15 years, through to 2030.

Whether we like it or not (let’s not go there right now) the decisions they make - each with their own veto - will have a bigger impact on our bills, our energy security and our emissions than anything which happens at a national level.

What’s more, the targets they agree will have a big impact on the EU’s negotiating position in Paris in a year’s time when global leaders get together to try and cut a deal which will shift our energy use toward renewables and away from oil, gas and coal enough to avoid the more catastrophic effects of climate change.

So what’s at stake today? Well much of the deal has already been decided and the devil will - as always - lie in the detail. Here’s the skinny:

 1. OK, so, broad brush strokes, what are we going to get?

It’s all about targets. EU leaders are likely to agree 3 targets to be reached by 2030, including:

  • A domestic 40% carbon dioxide reduction target, to be divided up amongst member states (compared to 1990 levels)
  • A renewable energy target for something like 27-30%
  • A target for a 30% cut in energy use through greater efficiency

2. Righto, is that a lot, a little?

It really depends where you are standing. If it’s Warsaw then you might think this is a pretty ambitious package, given Poland has repeatedly threatened to veto any deal which undermines its coal industry.

If you are in, say, the Maldives (or a floodplain) it may not look so great. Here’s the thing. In line with the scientific evidence on climate change - and global agreements about how to share the burden - the EU is committed to cutting emissions by 80-95% in 2050 (compared to 1990 levels) to reduce the risk of global temperatures going above 2 degrees and forcing you into a houseboat.

Cutting emissions by 40% (around 8% more than the commission estimates will happen anyway) by 2030 means you still have another 60% to go in just 20 years. Put another way, you have to cut the amount of oil, gas and coal you burn by two thirds in just two decades.

"I don't think many people have grasped just how huge this task is," Professor Jim Skea, a vice-chair of the Intergovernmental Panel on Climate Change, told the BBC.

"It is absolutely extraordinary and unprecedented. My guess is that 40% for 2030 is too little too late if we are really serious about our long-term targets."

The targets for renewable energy and efficiency are also hard to gauge because - as EU wide targets - it’s not totally/at all clear how they will be implemented by the commission.

If you are sitting in a wind turbine factory you may note that the EU is already committed to a 20% renewable energy target and the commission’s own analysis suggests that without any new policies at all it would reach 24% by 2030.

Indeed the new target would slow down the growth of renewables from 6.4% a year from 2010-2020 to 1.4% a year for the following decade (based on the commission’s assessment).

As for efficiency analysis by E3G EU unit suggests that a 30% target would amount to a 12% saving on current demand projections - so, a cut, but not a huge one.

The commission has calculated that with an efficiency target of 40 per cent, the EU could reduce gas imports by 40% and oil imports by 19%, compared to 2010. A target of 30% would only cut Europe’s gas imports by 22% and oil imports by 16%.

We’re not sure if this will unduly trouble Gazprom.

 3. But like it or hate it the deal’s done, today is just a formality right?

Not quite. To start with, the Polish could yet veto everything - just to add a bit of frissant to proceedings.

Assuming things don’t play out that way, there are some seemingly arcane arguments going on around the details.

The summit will agree the precise level of the targets on efficiency and renewables - with big impacts on energy imports and the clean energy sector.

It will also decide on some quite important wording. Will the target for emissions say “at least” 40%, suggesting the EU may be willing to negotiate something more ambitious during the global climate summit?

Will the EU renewables and efficiency targets be “binding” suggesting that even if they are not at national level some mechanism has to be found to force their implementation?

Consider the difference between a package which allows no room for change and has few mechanisms for implementation and one with at least a promise of implementation and the possibility of future negotiation. It’s dull, but it does matter (whichever you prefer).

4. What does business think?

Actually that’s something of a bone of contention. UK consumers will certainly see the difference either way - will they be buying gas or wind power in future? Will the UK’s emissions targets be adjusted down, or up with all the changes that brings?

EU businesses are fairly split. Some large energy firms such as EDF, EON, RWE etc with very large existing investments in oil, coal and gas have publicly lobbied against what they see as excessive ambition at an EU level, especially in the form of renewables.

Firms with less to lose, or perhaps more to gain, from the growth of a “clean economy” such as IKEA and Philips have called for far more ambitious targets, whilst some energy firms with investments in renewables have called for a higher target there (albeit not much higher).

5. What isn’t being agreed?

One sacrifice to Polish agreement on the deal is likely to be reform of Europe’s largely moribund carbon market. If it goes unreformed it may mean continuing free allocations of carbon allowances for industries - and possibly Polish coal plants.

Whilst this may still allow the EU to meet its modest 2030 target it has the effect of reducing the incentive for these sectors (or countries) to make long term investments in cleaner energy making the dash to the finish after 2030 tricky.

Indeed an analysis by Sandbag suggests that coal burning may fall by around 23% through to 2030, a fairly modest fall compared to the 100% EU leaders are targeting shortly afterwards.

Indeed an analysis by CAN Europe, WWF and Greenpeace found the vast majority of the estimated 12bn euros of European allowances and transfers intended to tackle climate change and diversify the energy mix between 2013-19 will instead be spent on coal.

Further reading:

Billions in EU allowances spent on coal

EU’s environmental policies could fail to limit coal burning

Can the UK cut it’s reliance on gas imports

Policy Notebook: How can EU leaders tackle climate change, and UKIP

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Damian Kahya

Damian Kahya is editor of Greenpeace's Energydesk blog.

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