Blanca Andrés Ordax, policy officer at the European Commission, DG Energy, outlines the policies in place to achieve zero greenhouse gas emissions across the European Union and what the energy sector needs to do to meet these objectives
WHAT IS THE EUROPEAN COMMISSION’S POSITION ON DECARBONISATION?
The Commission kicked off a broader debate following the launched of its vision on decarbonisation; Clean Planet for All:long-term vision for a prosperous, modern, competitive and climate neutral economy by 20501. This Europe-wide informed debate should then allow the EU to elaborate an ambitious strategy and submit it by early 2020 to the United Nations Framework Convention on Climate Change (UNFCCC).
Three years ago, the world community pledged to contain the rise in global average temperature well below 2?C above pre-industrial levels and to continue the action taken to limit the rise of the temperature to 1.5?C. The European Commission is convinced that Europe must itself aim for a target of zero greenhouse gas emissions by 2050.
This long-term vision looks into the all options available for member states & sheds light on transitions across different sectors of the economy with energy playing a central role. It explains that it is possible to decarbonise industry using technologies that are proven to work, such as electrification of heat and steam production, fuel switch to biomass and hydrogen, innovative low carbon processes and Carbon Capture and Sequestration or Use. Further work is needed to reduce costs and bring these technologies to the market.
Decarbonising will imply a thorough transformation of industry, significantly modernising existing installations or completely replacing them. This investment will constitute part of the next industrial revolution. Digitalisation and automation are some of the more promising and effective avenues to increase competitiveness, leading both to efficiency gains and to greenhouse gas reductions.
Oil and petroleum products will mainly be used as feedstock for non-energy uses by 2050, in contrast to the current situation. This will have an impact on refining and petrochemical industries. Sustainable biomass has an important role to play in a climate neutral economy. A net-zero emissions economy will require increasing amounts of biomass compared to today’s consumption with, depending on what technologies are chosen, the highest projections seeing an increase in bio-energy consumption of around 80% by 2050 compared to today.
Deployment of renewable electricity also provides a major opportunity for the decarbonisation of other sectors (for example: heating, transport, industry), also through the production of e-fuels through electrolysis (for example, e-hydrogen).
The deployment of carbon capture and storage (CCS) will be necessary, especially in energy intensive industries and – in the transitional phase – for the production of carbon-free hydrogen in order to ensure that we reach the ambitious net zero carbon goal.
WHAT KEY POLICIES ARE IN PLACE THAT AFFECT THE ENERGY SECTOR?
The EU has already put in place the most advanced legislative arsenal to enable it to achieve its 2030 objectives and make the European energy sector safer, more competitive and more sustainable.
In its 4th report on the State of the Energy Union2 from April 2018, the Commission took stock of the current policies, which resulted in a comprehensive set of rules. These include, among others, the ‘Clean Energy for All Europeans’ package3, with the objective to ensure a clean and fair energy transition at all levels of the economy.
This means finding the right blend between regulatory tools and market forces, encouraging private investment on clean energy where it makes economic sense and using EU funding to stimulate investment where market forces alone are not sufficient.
The most recent EU rules set out quantified objectives and a clear ‘direction of travel’ to 2030. They raised the EU level of ambition by setting new targets for 2030, namely: to reduce greenhouse gas emissions domestically by at least 40% compared to 1990 levels; to reach a share of at least 32% in consumption of renewable energy; and to increase energy efficiency by at least 32.5%. The electricity interconnections target was set to improve security of supply by stepping up to 15 % in each member state by 2030. Binding targets for 2030 were also set to reduce carbon emissions from cars by 37.5% compared to 2021 levels; from vans by 31% compared to 2021 levels; and from lorries by 30% compared to 2019 levels.
To achieve this, European legislation must first and foremost result in vigorous action on the ground. EU member states have prepared draft national energy and climate plans that include the national policies and measures needed to achieve the 2030 and 2050 targets. These plans will be completed by 2020.
However, without further efforts on our part, the mere continuation of these policies after 2030 would result in a reduction of our emissions by 60% by 2050, which is insufficient in view of our ambitions.
WHAT WILL BE THE IMPACT OF THESE POLICIES?
The overall economic benefits of a profound transformation are positive despite the scale of additional investment required in all sectors of the economy. The EU economy is expected to more than double by 2050 compared with 1990, even if it becomes completely carbon-free. Europe has demonstrated that decarbonisation and economic growth are compatible and go hand in hand. In fact, between 1990-2017, greenhouse gas emissions dropped by 22% while the economy grew by 58% over the same period.
A trajectory consistent with the goal of zero net greenhouse gas emissions, coupled with a coherent enabling framework, is expected to have a positive impact on GDP, with estimated profits of up to 2% of GDP by 2050.
The transition will stimulate the growth of new sectors. ‘Green jobs’ already represent four million jobs in the EU. New investments in industrial upgrading, energy transformation, the circular economy, clean mobility, green and blue infrastructure and the bio-economy will generate new, local and high-quality employment opportunities.
Our analysis shows that this transition will be beneficial for the vast majority of sectors and regions in Europe, but there will unfortunately be exceptions, such as the coal mining sector and oil & gas exploration. Other sectors will have to evolve in depth and be adapted to the new economy.
The process of profoundly modernising the corresponding economy will have to be properly managed to ensure that the transition is equitable and socially acceptable to all. It is imperative that no one be left behind:
the ecological transition will have to be united, or it will not be.
WHAT MUST THE ENERGY SECTOR DO TO HELP ACHIEVE THE PARIS AGREEMENT OBJECTIVES?
Today, the major part of our energy system, which accounts for more than 75% of the EU’s greenhouse gas emissions, is based on fossil fuels. All pathways assessed imply that by mid-century this will change radically. The deployment of renewable energy will drive a large-scale electrification of the energy system, be it at the level of end-users – such as energy use in industry, buildings or transport – or to produce carbon free fuels and feedstock for industry. The power sector will thus become a central element for the transformation of other economic sectors.
Most industrial greenhouse gas emissions stem from heating purposes in various applications. These emissions can be reduced through further efficiency improvements and by switching to low and zero carbon energy sources such as renewables-based electrification, sustainable biomass, synthetic fuels or hydrogen.
Around a quarter of industrial emissions consists of processrelated emissions (i.e., emissions from chemical reactions other than combustion), which are more difficult to reduce. Cutting these emissions will require genuine process innovation or the application of carbon capture and storage.
The transport sector currently relies largely on fossil fuels. Achieving deep emissions reductions will require an integrated system approach promoting (i) overall vehicle efficiency, low- and zero emission vehicles and infrastructure; (ii) a long-term switch to alternative and net-zero carbon fuels for transport; (iii) increased efficiency of the transport system. There is no single fuel solution for the future of low-carbon mobility – all main alternative fuel options will be needed. Changes in behaviour and consumer choice to shift from private transportation to low-carbon public transport, shared mobility and zero-carbon mobility (biking, walking) are also key.
Andrés Ordax will be talking more about the European Commission’s position on decarbonisation during the FETSA conference on June 12 in Tarragona, Spain. For more information visit the event website.