Summary and indicative rating of implemented EU regulations | EU Climate Policy Tracker 2011

Summary and indicative rating of implemented EU regulations

GENERAL		• Coverage is high. The EU is committed to reduce greenhouse gas emission by 80% to 95% by 2050. However, an agreed climate strategy does not yet go beyond 2020. Innovation strategies and the amount of resources for research and development in climate change and energy are mainly determined nationally. • Flexibility for member states is significant. Long term EU targets are not yet legislated or binding. Resources for research and development have some EU guidelines. • Score: ‘F’. Although the longer term target is a step in the right direction, the target is not binding and the implementation strategy only reaches until 2020.
ELECTRICITY SUPPLY	Renewables	• Coverage is almost complete. The Renewable Energy (RES) Directive sets renewable targets for 2020 and regulates most prominent barriers. • Flexibility for member states is significant. The RES Directive sets binding targets – member states have flexibility in choosing support mechanism and are not required to differentiate between different types of technology. The most prominent barriers are regulated. • Score: ‘B’. The target of the RES Directive of 20% renewable energy in 2020 is quite ambitious. In the electricity supply sector this translates to a 15-20% increase in renewable electricity’s share in 2020, which is almost as ambitious as the 20% increase required in the low-carbon policy package.
	Energy efficiency	• Coverage is high, with a directive aiming to stimulate combined heat and power (CHP) use. Losses during distribution of electricity and heat have only recently been covered by the recently proposed draft of the Energy Efficiency Directive. Investments in electricity grids are as yet minimally coordinated by the EU. • Flexibility for member states is high, as the CHP Directive gave non-binding targets until 2010. Its impact heavily depends on implementation at member state level, which is weak at the moment. • Score: ‘F’. The requirements of the CHP Directive are not ambitious enough.
	Overarching	• Coverage is high with the EU emission trading system (ETS) giving price signals to power generation, although emissions performance standards for fossil fuel power plants are not set. Member states continue to subsidise conventional fuel supply. The EU gives a legal framework for carbon capture and storage (CCS) and taxes are covered by the Energy Tax Directive. • Flexibility for member states is limited overall, due to the emission trading system. Member states have higher flexibility to adopt additional legislation on taxes, subsidies and carbon capture and storage. • Score: ‘D’. EU emission trading system so far does not give sufficient price signals. Since taxes on power production are exempted from minimum tariffs, they are far away from the required levels of around 100% of the energy price. Subsidies on coal mining are allowed until 2018.
INDUSTRY	Renewables	• Coverage is high, with the RES Directive influencing the use of renewables in industry and potentially imposing sustainability criteria on biomass. Demonstrations can be funded through Cohesion and NER300 funds. • Flexibility is significant as member states have flexibility in choosing if support mechanism for renewable energy apply to industry and how sustainability< criteria are applied. • Score: ‘C’. Corresponding to the ‘B’ score on renewable electricity, achieving the 20% renewables target will help reach 10% share of renewables in industry in 2020 that is given in the low-carbon policy package. The lack of stringent biomass sustainability requirements is a problem for heat production in industry.
	Energy efficiency	• Coverage is medium, with only the Eco-design Directive directly impacting energy efficiency policies in industry. EU emission trading system has an indirect effect. The recently proposed – but not yet adopted - Energy Efficiency Directive includes frequent and mandatory energy audits for large companies, as well as a greater use of residual heat and heat from cogeneration. • Flexibility for member states is significant, since there is no binding energy efficiency target for member states. Member states are tied to the norms on electrical motors set in the Eco-design Directive. • Score: ‘E’. The EU energy efficiency target of 20% is in line with a low-carbon policy package, but policies are missing. Doubling of ambition in energy efficiency in industry is needed.
	Overarching	• Coverage is medium, with an Energy Tax Directive setting minimal tax levels and the EU emission trading system regulating CO2 prices in industry. The main gap is the redesign of products to be less material intensive, longer lasting and 100% recyclable is not targeted. Although the EU has made a resource-efficient Europe one of its ‘flagship initiatives’, this has not yet translated into policies. • Flexibility for member states is limited as the EU emission trading system is giving harmonised rules with only limited flexibility to member states. Countries could increase taxes, or stop exemptions, on industrial energy use. • Score: ‘E’ The minimum energy tax levels for industry are too low and with significant exemptions. EU emission trading system does not give sufficient price signals.
BUILDINGS	Renewables	• Coverage is almost complete as the use of renewable energy and new< technologies are supported by the Energy Performance of Buildings Directive and the share of RES in buildings is (indirectly) covered by the RES Directive. • Flexibility is significant as member states have the flexibility in choosing support mechanisms. There is no specific building related target for the increase in the use of renewable heat and cooling in buildings. • Score: ‘C’. Corresponding to the ‘B’ score on renewable electricity, achieving 20% renewables target will help reach the additional 10% share of renewables< in buildings in 2020 that is given in the low-carbon policy package. The lack of stringent biomass requirements is a problem for heat production in buildings.
	Energy efficiency	• Coverage is medium, as the Eco-design Directive sets minimum performance standards for (some) equipment. The Energy Performance of Buildings Directive sets standards for existing buildings, although the most prominent barriers (such as the landlord-tenant dilemma) are not regulated. A significant gap is retrofitting of the existing building stock. • Flexibility for member states is limited. Member states have significant flexibility in complying with the demands for existing buildings, but cannot adopt stricter norms on appliances regulated by the Eco-design Directive. • Score: ‘D’. The ambition level of the Eco-design Directive should be doubled and the requirement for nearly zero energy buildings should be shifted from 2020 to 2014 for a maximum score.
	Overarching	• Coverage is complete, with the Energy Tax Directive affecting the only indicator in this area. • The flexibility for member states is significant, since member states should adopt the minimum tariffs set in the Energy Tax Directive but are free to impose higher taxes if they see fit. • Score: ‘G’, the minimum tariffs set in the Energy Tax Directive are too low to have a real effect.
TRANSPORT	Renewables	• Coverage is high. The RES Directive sets a binding target of 10% share of renewables in transport in 2020, including sustainability criteria. The gap is that there is no EU legislation on the development of infrastructure for electric mobility. • Flexibility for member states is significant. Member states are free to decide on policy measure to meet the binding target. • Score: ‘C’. Target of 10% renewables in 2020 is in line with the requirements for a low-carbon policy package, but the sustainability criteria are insufficient.
	Energy efficiency	• Coverage is medium. EU has CO2 efficiency standards for new passenger cars and vans. The main gap is freight transport via road, rail or shipping is not covered. With about 9% of the primary energy use in the EU it is the most significant economic activity not covered. • Flexibility for member states is low. Emission norms for vans and passenger cars are part of an EU regulation directly and entirely applicable to all member states. • Score: ‘E’. Standard for new passenger cars is phased in from 2012 to 2015 (130 gCO2 per km) with a longer term (not binding) target of 95 gCO2 per km.
	Overarching	• Coverage is medium. The Energy Tax Directive sets minimum tax levels for transport fuels. The major gaps are that EU has no legislation that is targeted at a modal shift or reduction of traffic. Investments in low-carbon infrastructure are partially targeted by Cohesion funds available for investment in rail transport. • Flexibility for member states is limited. Spending of Cohesion fund money has restrictions. Member states can impose higher taxes than the minimum standards. • Score: ‘F’. Minimum tax levels for transport fuels are around 40-50% of the energy price, while they should be 400% of the current energy price.
AGRICULTURE		The major gap in the EU’s agriculture policy is that it does not include a long term climate perspective. A reform of the EU subsidy scheme, taking emissions into consideration, would be needed, especially in the longer term of our vision, when agriculture will become the main emitter of greenhouse gas emissions.
FORESTRY		The EU’s forestry policy is guided by the RES Directive, which encourages member states to complete biomass plans, and the Cohesion Funds, where beneficiaries can be supported for investment in reforestation. Gaps are that comprehensive land use strategies, forest management and prevention of deforestation are not directly targeted at EU-level.