Abby L. Harvey
GHG Monitor
10/24/2014
The European Council announced this week a climate and energy policy framework for the European Union that calls for a reduction in greenhouse gas emissions by 40 percent from 1990 levels by 2030. Other targets called for in the framework include a binding target of at least 27 percent of renewable energy used at EU level, an energy efficiency increase of at least 27 percent and the completion of the internal energy market by reaching an electricity interconnection target of 15 percent between member states. “The European Council endorsed a binding EU target of an at least 40 [percent] domestic reduction in greenhouse gas emissions by 2030 compared to 1990. To that end the target will be delivered collectively by the EU in the most cost-effective manner possible, with the reductions in the [Emissions Trading System] and non-ETS sectors amounting to 43 [percent] and 30 [percent] by 2030 compared to 2005, respectively; all Member States will participate in this effort, balancing considerations of fairness and solidarity,” says the council’s Conclusions on 2030 Climate and Energy Policy Framework, published late this week.
The framework also calls for the New Entrants Reserve 300 funding scheme to be renewed and ramped up within the Emissions Trading System. “The existing NER300 facility will be renewed, including for carbon capture and storage and renewables, with the scope extended to low carbon innovation in industrial sectors and the initial endowment increased to 400 million allowances (NER400). Investment projects in all Member States, including small-scale projects, will be eligible,” the document says.
Further, the framework calls for investments in the energy needs of low income member states through a reserve of funds from the emission trading system. “A new reserve of 2 [percent] of the EU ETS allowances will be set aside to address particularly high additional investment needs in low income Member States (GDP per capita below 60 [percent] of the EU average). It will have the following characteristics: the proceeds from the reserve will be used to improve energy efficiency and to modernise the energy systems of these Member States, so as to provide their citizens with cleaner, secure and affordable energy; the use of the funds will be fully transparent; allowances from the reserve will be auctioned according to the same principles and modalities as for other allowances; the reserve will serve to establish a fund which will be managed by the beneficiary Member States, with the involvement of the EIB in the selection of projects. Simplified arrangements for small-scale projects will be ensured,” the document says. “Until 31 December 2030 the distribution of funds will be based on the combination of a 50 [percent] share of verified emissions and a 50 [percent] share of GDP criteria, but the basis on which projects are selected will be reviewed by the end of 2024.”
