Newsletter 4.2019

Dear readers,
Welcome to the fourth Eurofuel newsletter of 2019. The last couple of months have been very busy in Brussels with the EU elections and important Council meetings. Let’s see what this means in the future for the EU energy policy and for heating oil.
Sandrine Devos

European Parliament elections and impact on climate and energy policy
The 2019 European elections saw the highest turnout in 20 years: almost 51% of European citizens cast their vote. As expected, the outcome is a more fragmented Parliament. Despite losing some seats, the centre-right European People’s Party (EPP) remains the largest political group in the new Parliament, followed by the Socialists (S&D). The biggest winners are the Liberals (ALDE / Renaissance) and the Eurosceptics. The Greens also performed well.

The new balance of power means that the existing ‘grand coalition’ between the centre-right EPP and centre-left S&D – previously guaranteeing stable majorities – can no longer command a majority and building consensus will now be more difficult. New coalitions will have to be sought on the different legislative files.
Climate policy and de-carbonization will remain very high on the EU agenda in the next five years. Most parties have explicitly addressed climate and environmental policies in their manifestos. While the levels of ambitions differ, all European political groups realize the urgency of the topic. The rise of the Greens also shows the growing importance of the topic (even though the trend is not equally strong across member states).
The strong green signal will very likely impact the direction of policy that the European Commission will take. But despite the important role played by the Parliament, the level of ambition on climate and energy policies will still depend on Member States, who are expected to adopt a position on an EU Long-Term Decarbonisation Strategy in the coming months.

EU Finish Presidency
The focus on energy and climate is at the top of the working programme that Finland released on 26 June for its upcoming Council Presidency starting on 1 July. The document, titled ‘Sustainable Europe – Sustainable Future’, calls to “strengthen the EU’s position as a global leader in climate action”, proposing to integrate climate policy in all sectors and drive emission reductions. Finland is amongst the most progressive countries on climate action and has recently pledged to reach carbon neutrality by 2035. Finland’s Prime Minister Antti Rinne told reporters that finding an agreement in the Council on carbon neutrality by 2050 will be a top priority for his government over the next half year.

European Council summit - Heads of State discussed mid-century climate objectives
Heads of state and government failed to reach a consensus on the target of achieving climate neutrality by 2050. While pointing out the need to “ensure a transition to a climate-neutral EU in line with the Paris Agreement”, the summit conclusions do not mention a clear timeframe to reach the objective. Despite this disagreement, the momentum for decarbonisation by 2050 grew dramatically over recent weeks, and Member States are expected to continue their work on the topic. Environment ministers discussed the Long-term Strategy at a Council meeting this week and the issue will likely be back on the agenda of the October European Council meeting. During the European Council, leaders adopted the strategic agenda for the 2019-2024 mandate, which includes the objective to build “a climate neutral, green, fair and social Europe”.

Energy Ministers discussed the future of energy systems
On 25 June, EU Energy Ministers discussed the future of energy systems in the European Union. The meeting resulted in the adoption of a set of conclusions providing a vision for energy policy in the EU for 2030 and beyond, identifying the following priorities:
• Promote the development and deployment of innovative technologies
• Promote sector coupling and sector integration
The conclusions invite the European Commission to consider the above-mentioned principles when presenting proposals during the next legislative term. The document explicitly refers to affordable energy.

European Commission released comments on Member States’ draft National Energy and Climate Plans
The European Commission published its first review of draft National Energy and Climate Plans, reports in which each Member State is required to outline the actions needed to reach the 2030 targets for emission reductions, renewable energy, and energy savings. After receiving the comments, national governments will have until the end of 2019 to address the Commission’s recommendations and finalize the plans.
In the conclusions, the Commission stresses that the next six months will be crucial for Member States to close all the ambition gaps by presenting improved plans contributing to the long-term decarbonisation goals in the context of the Paris Agreement.

Where does heating oil stand?
Energy and climate are at the top of the agenda and for good reasons. One key message to take out of all the discussions is that the issue is not only urgent – it is very complex, and no silver bullet will solve it. A technology-open pragmatic approach is more than ever required to meet the targets. For the energy mix to be comprehensive and socially fair, it needs to take into account all the energy carriers to their best use. With the right policy framework, liquid fuels for heating have the potential to contribute to EU’s energy and climate policy objectives towards 2030, 2050 and beyond.