Newsletter 09.2018

Dear readers,

Welcome to the fourth edition of our Eurofuel Newsletter! As children, public officials and stakeholders are making it “back to school” in Brussels, I hope you have had a very nice and warm summer time!

Summer Brussels Mont des Arts

Before diving into the traditionally hectic autumn months, it may be worth taking stock of the main developments that concluded the eventful and energy-intensive Bulgarian Presidency of the Council before the summer recess.

The last “trilogue” negotiations between institutions on the most challenging components of the Clean Energy Package, including the Governance Regulation, the Energy Efficiency Directive (EED) and the Renewable Energy Directive (REDII), were concluded in the course of June. Following intense pressure, the Bulgarian Presidency managed to strike last-minute agreements on all three files, a remarkable success given the major divisions between European Parliament and Member States on key aspects of these legislative proposals to shape Europe’s 2030 climate and energy policy.

Looking at 2050 horizons, early July was marked by a two-day high-level conference and the launch of a public consultation about the upcoming EU long-term strategy (LTS) on reducing greenhouse gas emissions.

The possible role of low-carbon liquid fuels in Europe’s evolving energy mix was in the focus of Eurofuel’s Technical Workshop on 6 June and a presentation to EU Sustainable Energy Week on 7 June.

I wish you a good “back-to-school” season and look forward to meeting you soon!

Tristan Suffys

 

Energy Efficiency Directive (EED): Agreement at the eleventh hour

The EED dossier turned out to be one of the most challenging tasks of the Bulgarian Presidency. After a failed trilogue on 13 June, mainly due to disagreements on the overall energy efficiency target, a new meeting was called for 19 June, which managed to clinch a last-minute deal on this highly disputed file.

What is a compromise like? Negotiators agreed on an EU-wide, non-binding, indicative target of 32.5% (not 32, not 33 but indeed 32.5%) by 2030, subject to a review clause by 2023, intended to help align the legislation with the Paris Agreement. This means that the European Parliament and the Council met exactly midway compared to their starting positions – respectively 35% and 30%. The directive also includes a mandatory annual sub-target of 0.8% to be achieved by Member States in real energy savings between 2021 and 2030.

Regarding the Primary Energy Factor (PEF) for electricity, negotiators agreed on a value of 2.1, to be reviewed every four years. Although messages have been confusing about this specific point, it now appears that the value should be used for other pieces of legislation as well, including the Ecodesign Directive and the Energy Labelling Regulation, which will artificially favour electricity-based over other heating systems.

The compromise text has been endorsed by the Council’s preparatory body and the Parliament’s relevant committee. It will still need approval in plenary, likely on 12 November 2018, before being formally adopted and published in the EU’s Official Journal. Member States will then have 18 months to transpose the act into their national legal systems.

Efficiency House

 

Energy Governance: Agreement on instruments to implement Europe’s Clean Energy Package

In the same night as the EED deal on 19 June, another agreement was reached, this time on the Governance Regulation. It took the involved parties four trilogue negotiation rounds to achieve success on a file that is meant to hold together the other building blocks of the Clean Energy Package.

Among the main outcomes, the negotiators have called the Commission to aim for a net-zero emissions economy "as soon as possible", in a move meant to feed into the Commission’s current work on a long-term strategy to reduce emissions by the middle of this century.

Furthermore, the Regulation introduces a "gap-filler" mechanism of intermediary objectives to ensure that the renewable energy target (32% of the EU’s energy use by 2030) will not be derailed in the implementation phase.

You didn’t like maths at school? Well, be prepared, this is what the gap-filler will look like: Member States should collectively achieve 18% of the 2030 objective by 2022; 43% of it by 2025; 65% of it by 2027; and, of course, 100% by 2030.

For each of these milestones, the Commission will assess the progress of the countries and the EU as a whole, and if both fall behind their pledges, countries will be obliged to take corrective measures.

A similar mechanism was set for energy efficiency, despite the non-binding nature of its measures.

Just like the EED, the file is expected to be submitted for a plenary vote in the European Parliament in November before final adoption.

 Curves red size

 

Renewable Energy: Unexpected deal achieved

Out of the three files, REDII was the first one to be concluded - against all odds, given the failure to reach a compromise on energy efficiency earlier that day, on 13 June. The legislation is meant to pave the way for Europe's transition towards clean energy sources such as wind, solar, and biomass energy.

After several attempts, the negotiators managed to strike a deal on the basis of a binding 32% target of renewable energy by 2030, subject to an ‘upward review clause by 2023’. This was seen to be a significant win for the European Parliament, which had been pushing the Council for a substantial increase in ambition.

If you happen to like targets, you will love the REDII… Besides the overall one, the agreement includes a renewable energy target of 14% by 2030 for the transport sector, along with the complete phase-out of palm oil use in transport by the same year; a freeze in 1st generation (crop-based) biofuels in transport at 2020 levels; and a 3.5% target for 2nd generation biofuels in transport by 2030. Closer to our sector, the deal also provides for an annual increase of 1.3 percentage point in the share of renewables in the heating and cooling sector, to be achieved at Member State level, based on the level achieved in 2020.

Here, too, the final text will be submitted to the Parliament plenary in November before final adoption and publication in the Official Journal of the EU.

Targets

 

Energy Performance of Buildings Directive (EPBD): Off to the Member States!

The revised EPBD had been adopted on 30 May 2018. It has now been published in the Official Journal of 19 June and Member States have 20 months to transpose it into national law.

 

Long-term strategy (LTS) on emission reduction: European Commission informs and consults stakeholders

On 10-11 July, the European Commission organised in Brussels a high-level stakeholder conference on the EU's Vision of a modern, clean and competitive economy, hosted by Commissioner Miguel Arias Cañete. Speakers included several Commission Vice-Presidents, Commissioners, Directors-General and Directors from relevant DGs, MEPs, national ministers, the Presidents of COP21 and COP24. Over a thousand stakeholders attended this major set of lectures at Brussels Free University ULB.  

The Commission presented its ambition for a long-term strategy to reduce emissions by the middle of our century, due to be adopted in November, which should reflect the EU commitments made in the 2015 Paris Agreement. The conference signalled the launch of a public consultation on the upcoming LTS, which will run until 9 October and feed into the preparatory works on this important file.

LTS conference

(EU high-level stakeholder conference on the EU's Vision of a modern, clean and competitive economy - Brussels, 10-11 July 2018)

 

New liquid fuels: Eurofuel discusses experience and potential

Anticipating the Commission’s two-day seminar on emission reduction, Eurofuel held on 6 June a Technical Workshop on future liquid fuels, which will certainly be crucial in achieving Europe’s climate policy goals in a cost-effective way.

The event was a great opportunity to bring together experts and professionals of liquid fuels to discuss first experience with new fuels, from second-generation biofuels to Power-to-Liquids (PtL), and their perspectives in the future EU energy and heat mix. Representing the European Commission in the speakers’ panel, Eva Hoos (DG ENER) shared the view that liquid fuel solutions are an asset to store energy and hybrid heating systems will likely play a major part in the transition to a low-carbon energy model.

You can find here all speaker presentations and further details about our workshop. If you want to know more, there will be further opportunities to meet in the coming months!

Future fuels are an important subject for our sector. They were discussed extensively by our Technical Commission, meeting on 22 August in Hamburg, and you will shortly be reading more on interesting industry developments in this field. Stay tuned!

Workshop Website photo 1 

(Eurofuel Technical Workshop on future liquid fuels - Brussels, 6 June 2018)