Newsletter 1.2022
Dear reader,
Welcome to the first EUROFUEL newsletter of this year! This edition looks at same of the latest energy policy developments at global and European level, focusing respectively on COP 26 and the adoption of the second part of the Fit for 55 Package.
These show once again the level of ambition taken by governments and international institutions to rapidly reduce emissions and achieve climate neutrality. As it is often the case, the EU is leading the efforts by adopting ambitious legislative proposals. The latest – analysed in this newsletter – is the revision of the Energy Performance of Buildings Directive (EPBD), which aims to drastically reduce emissions from buildings by supporting renovation programmes and the use of renewable energy sources.
Following the other legislative proposals currently under discussion, the EPBD puts additional pressure on our sector, urging us and our partners to engage with policymakers by clearly communicating on the benefits and concrete use cases of low carbon and renewable liquid fuels.
Yours,
Dr Ernst-Moritz Bellingen
COP26 – Key takeaways
From 31 October to 12 November 2021, the UK hosted the 26th UN Climate Change Conference of the Parties (COP26) in Glasgow. The summit brought parties together with the objective of accelerating action towards the goals of the Paris Agreement and the UN Framework Convention on Climate Change. A final statement was released on 13 of November regarding the conclusions of COP26.
The COP26 agreement is not legally binding. However, it will set the global agenda on climate change for the next decade. Below an overview of the key takeaways:
- Emissions
It was agreed countries will meet next year to pledge further cuts to emissions of CO2. This is to try to keep temperature rises within 1.5 C. Current pledges, if met, will only limit global warming to about 2.4 C.
- Coal
For the first time at a COP conference, there was an explicit plan to reduce use of coal - which is responsible for 40% of annual CO2 emissions. However, countries only agreed a weaker commitment to "phase down" rather than "phase out" coal after a late intervention by China and India.
- Developing countries
The agreement pledged to significantly increase money to help poor countries cope with the effects of climate change and make the switch to clean energy. There's also the prospect of a trillion dollar a year fund from 2025 - after a previous pledge for richer countries to provide $100bn a year by 2020 was missed.
- Fossil fuel subsidies
World leaders agreed to phase-out subsidies that artificially lower the price of coal, oil, or natural gas. However, no firm dates have been set.
- Methane
A scheme to cut 30% of methane emissions by 2030 was agreed by more than 100 countries. Methane is currently responsible for a third of human-generated warming. The big emitters China, Russia and India haven't joined - but it's hoped they will later.
- Financing
Financial organisations controlling $130tn agreed to back "clean" technology, such as renewable energy, and direct finance away from fossil fuel-burning industries. The initiative is an attempt to involve private companies in meeting net zero targets.
Beyond the negotiations leading to the final agreement, this COP also saw the presence of several other side initiatives and campaigns. Some of them were targeted towards fossil fuels, such as the Beyond Oil and Gas Alliance (BOGA) to phase out oil and gas production — launched by Costa Rica’s Environment Minister Andrea Meza and Denmark’s Climate Minister Dan Jørgensen. It was a first in an international climate process that has always focused on limiting emissions from fossil fuels rather than turning off the tap. Other initiatives denounced the influence of the fossil fuel industry at COP and in general in political decisions. An example is the “Fossil free politics” campaign, led by a variety of influential NGOs, which advocates to “cut fossil fuel interests out of politics”.
COP 26 and its side initiatives once again showed the level of pressure the conventional fuel industry is facing at global level, urging all actors involved – including our sector – to develop credible and concrete decarbonisation solutions.
Fit for 55 Package – Part 2
On 15 December 2021, the European Commission presented the second part of the Fit for 55 Package (first part adopted in July), including a series of legislative proposals to further reduce GHG emissions and achieve the 55% emission reduction target by 2030 compared to 1990 levels.
The proposals include a recast of the Energy Performance of Buildings Directive (EPBD) and proposals for a new framework to decarbonise gas markets, promote hydrogen and reduce methane emissions
The most relevant initiative for the heating oil industry is the EPBD recast, which introduces measures on how Europe can achieve a zero-emission and fully decarbonised building stock by 2050. The key elements of the Commission’s proposal are the following:
- Zero-emission buildings: as of 2030, all new buildings must be zero-emission. To harness the potential of faster action in the public sector, all new public buildings must be zero-emission already as of 2027. This means that buildings must consume little energy, be powered by renewables as far as possible, emit no on-site carbon emissions from fossil fuels and must indicate their global warming potential based on their whole-life cycle emissions on their Energy Performance Certificate.
- New EU-level minimum energy performance standards: the worst-performing 15% of the building stock of each Member State must be upgraded from the Energy Performance Certificate's Grade G to at least Grade F by 2027 for non-residential buildings and 2030 for residential buildings.
- Energy Performance Certificates: improved and clearer information will be mandated. The obligation to have an energy performance certificate is extended to buildings undergoing major renovation, buildings for which a rental contract is renewed and all public buildings.
- National Buildings Renovation Plans: must be fully integrated into National Energy and Climate Plans and need to include roadmaps for phasing out fossil fuels in heating and cooling by 2040 at the latest, along with a pathway for transforming the national building stock into zero-emission buildings by 2050.
- Buildings renovation: introduction of a building ‘Renovation passport' that provides owners a tool to facilitate their planning and a step-by-step renovation towards zero-emissions level.
- Boiler installations: No financial incentives should be given for the installation of fossil fuel boilers as of 2027. While no EU-level phase out date for fossil fuel boilers is mandated, a clear legal basis for national bans is introduced, allowing Member States to set requirements for heat generators based on greenhouse gas emissions or the type of fuel used.
- Buildings digitalisation: the use of information and communication technology (ICT) and smart technologies to ensure buildings operate efficiently is encouraged.
- Mobility: the rollout of charging infrastructure for electric vehicles in residential and commercial buildings is supported. More dedicated parking space available for bicycles are also promoted.
The proposal targets the use of fossil fuels in heating, thus having a strong impact on the heating oil sector. In the coming months, it will be examined by the Parliament and the Council. Together with its partners and allies, Eurofuel will engage with key policymakers working on this file to ensure that renewable and low carbon fuels are allowed to play a role in the decarbonisation of the EU building stock.
National news
Belgium
In April 2021, Informazout offered individual households the opportunity, via the MazoutMail program, to discover low-carbon liquid fuels. A few weeks ago, the distributors participating in the initiative delivered a fuel mixture called R33 to the selected families. R33 is a mixture of 67% diesel fuel and 33% renewable fuel: 26% HVO and 7% FAME. Why choose R33?
1. This mixture is also used in other European countries. The same parameters are checked and measured there.
2. en2x, in Germany, has already carried out numerous tests and technical inspections with this R33 mixture. It shows that it can be used without having to adapt the heating system. R33 works perfectly mixed with conventional heating oil and offers a performance comparable to the latter.
3. An oil-fired boiler that uses R33 emits less CO2eq / kWh than a natural gas boiler.
Families that have been delivered with this fuel have already been able to appreciate during the cold days how comfortable the heat produced is. And distributors believe more than ever in the importance of low carbon fuels to sustainable heating. Testimonies on https://pro.informazout.be/fr/stories/r33
France
The French Government has adopted a decree, regulating the installation of new thermal equipment in new and existing buildings (residential and tertiary). It was published in the Official Journal on 6 January, and aims at limitating greenhouse gas emissions from new heating equipment.
This regulatory measure, announced in July 2020, marks a major step in the transition from 100% fossil heating oil to liquid biofuel and keeps different options open for heating, depending on the characteristics of the homes.
If the installation of a new boiler running on traditional domestic heating oil (100% fossil fuel) will no longer be authorized as of 1st July 2022, replacement by a boiler running on a liquid biofuel, such as F30 biofuel, will be a more efficient alternative, particularly for areas with only a limited choice of solutions.
The provisions of the Decree will take effect on 1st July 2022 and will have the following main consequences:
- The obligation for new boilers, installed from 1st July 2022, to use a liquid biofuel whose lifecycle emissions (LCA) are below the new threshold limit of 300g CO2eq / kWh PCI.
- The possibility for boilers currently in service and those installed until 30 June 2022 to continue to use traditional domestic heating oil (which can contain up to 7% of renewable energy according to current specifications).
Any repairs to that equipment will be authorized, either to remain with traditional heating oil, or to switch to F30 biofuel.
A list of new boilers compatible with liquid biofuel will be available as of February 2022 on www.biofioul.info
- The possibility for new hybrid installations, combining heat pump and heating oil generator, and installed after 30 June 2022, to use traditional heating oil or F30 biofuel.
According to Eric Layly, President of FF3C: "With this Decree, the Ministry of Ecological Transition is giving itself the means to materialize its commitment to accelerate the gradual disappearance of 100% fossil heating oil in favor of more virtuous solutions in environmental matters. It thus validates, without penalizing the households concerned, the alternative of the heating liquid biofuel that biofuel embodies."
This Decree allows households to install new equipment running with a liquid biofuel as long as it complies with the ceiling of 300g CO2eq / kWh PCI. This option thus preserves the interests and the free choice of consumers who, when they have to change their equipment, will be able to choose the solution most suited to their needs. Biofuel in France is positioned as the only immediate alternative to 100% fossil heating oil, by being technically reliable, ecologically acceptable and economically sustainable for households.