Energy is a vital issue. Unevenly distributed and unequally consumed, natural reserves are moreover not inexhaustible. Confronted with these facts, and concerned by economic crisis and climate changes, the countries tend to change their relationship to energy: A deep and worldwide transformation in the way energy is produced and consumed is already underway and can be expected to intensify in the coming months and years. This is what is called the ENERGY TRANSITION.

In Europe this transformation took form under three main strategies that was implemented these last 4 years and that reformed the European energy sector: COP21 (the Paris Agreement), the decision of an Energy Union, and the reforms towards a smart, efficient and sustainable energy sector (including for Transport and Buildings).





COP21: The Paris agreement

The EU has been at the forefront of international efforts towards a global climate deal. It has been building a broad coalition of developed and developing countries in favour of high ambition that shaped the successful outcome of the Paris conference. The EU was the first major economy to submit its intended contribution to the new agreement in March 2015. It is already taking steps to implement its target to reduce emissions by at least 40% by 2030.

The 2015 Paris Agreement is a historically significant landmark in the global fight against climate change. The Agreement provides a lifeline, a last chance to hand over to future generations a world that is more stable, a healthier planet, fairer societies and more prosperous economies, also in the context of the 2030 Agenda on Sustainable Development.

EU’s commitment to a clean energy transition is irreversible and non-negotiable. The Energy Union priority aims at “moving away from an economy driven by fossil fuels, … where energy is based on a centralised, supply-side approach and which relies on old technologies and outdated business models, to empower consumers and (…) to move away from a fragmented system characterised by uncoordinated national policies, market barriers and energy-isolated areas”. The Energy Union Project, with all its dimensions, provides a broader framework within which the EU can provide the right enabling environment for the energy transition [1].

However, the road is still long in order to reach the objectives of Paris agreement. The transition to a low carbon, resource-efficient economy demands a fundamental shift in technology, energy, economics, finance and ultimately society as a whole. In order to success in this shift, the EU wishes to support research, innovation and competitiveness. The future strategy for the Energy Union will tap into the synergies between energy, transport, circular economy, industrial and digital innovation. The EU will also join the “Mission Innovation” launched by twenty of the world leading economies to reinvigorate public and private clean energy innovation, to develop and deploy breakthrough technologies and achieve cost reductions.

[1] Source: The Road from Paris: assessing the implications of the Paris Agreement and accompanying the proposal for a Council decision on the signing, on behalf of the European Union, of the Paris agreement adopted under the United Nations Framework Convention on Climate Change (COM 2016 -110)

Energy Union

On 25 February 2015, the EC launched its Energy Union strategy, and achieving the electricity interconnection target in all MS by 2020 is part of that strategy.

The Energy Union Package is a set of three Communications:

A Framework Strategy for a Resilient Energy Union with a Forward-Looking Climate Change Policy” setting out the goals of a European Energy Union, as well as the detailed steps to achieve it – stronger regional cooperation as an important step towards building a single internal electricity market, ensure more gas contract transparency and improve security of supply, increased EU funding for energy efficiency and renewable energy to decarbonize national economies, via the boosting of research and innovation.
An Interconnection Communication, setting out the measures needed to achieve the target of 10% electricity interconnection by 2020
A Communication setting out a vision for a global climate agreement at COP21 in Paris in December.

On July 15th 2015, the EC issued a Communication to launch a public consultation on a new energy market design. The electricity market design initiative aims to improve the functioning of the internal electricity market in order to allow electricity to move freely to where and when it is most needed, reap maximum benefits for society from cross-border competition and provide the right signals and incentives to drive the right investments, while fully integrating increasing shares of renewable energies. A change in the market design is required to cope with a growing share of renewable energy in the power systems of member states, which has led several countries to adopt capacity mechanisms in an uncoordinated way. The Commission’s proposals include creating cross-border short term markets, coordinated cross-border system operation, strengthening the regulatory framework to facilitate regional market integration, encouraging flexibility for better RES integration, facilitating wider market participation for demand response, coordinated EU approaches to capacity markets and harmonised RES support schemes. These proposals, if adopted, would facilitate regional market integration.

Towards a smart, efficient and sustainable energy sector

Energy Sector is not only electricity, heating and cooling of buildings and transport are major sources of energy consumption.

Transport is responsible for around a quarter of EU greenhouse gas emissions, mainly for road transport. But also for the aviation and maritime sectors which are experiencing the fastest growth in emissions. To deal with the challenges of the transport sector, a wide range of policies aiming to lower emissions from the sector have been put in place these last years:

For road transport:

Emissions targets, rolling resistance limits and tyre labelling requirements for new vehicles, strategy for reducing heavy duty vehicle fuel consumption and CO2 emissions;
For road transport: legislation encouraging national authorities to deploy gas & electricity infrastructure and to support stronger use of public transport;
For aviation: Inclusion in the EU Emissions Trading System (ETS).
In addition to these measures, policies and technologies that are needed to achieve substantial emission reductions by 2050 are being investigated.

In buildings also, large efforts still need to be developed to increase the energy efficiency. On February 16th 2015, European Commission launched the first strategy to optimize buildings’ and industries’ heating and cooling. Currently, the whole sector accounts for 50% of the EU’s annual energy consumption; it accounts for 13% of oil consumption and 59% of total EU gas consumption (direct use only) – which equates to 68% of all gas imports.

In order to decrease energy leakage from buildings, maximise efficiency and boost the share of renewables, the EU Heating and Cooling Strategy focuses on the promotion on energy efficiency, and smart technologies, the increase of renewables’ share, the reuse of energy waste and the involvement of consumers and industries.