EU Energy & Climate Policy Update | No. 41

Dear reader,

Welcome to the new edition of Publyon’s EU Energy and Climate Policy Update. In this bi-weekly update, Publyon provides you with the latest insights on the ‘Fit for 55’ negotiations as well as updates on the energy transition, the energy crisis and the EU’s response, including other relevant news on the EU’s climate and emissions reduction policies.

The spotlight

The spotlight

EU’s Carbon Removal Certification for greenwashing-proof emission erasing

The Commission’s stonewall attack against greenwashing has made significant progress in the legislative process – European Parliament’s Environment (ENVI) Committee adopted its position on the certification framework for carbon removals (CFCR). The countdown to the vote in Parliament’s Plenary session has begun, with less than two weeks to go.


Why is it important?

In hard-to-abate sectors (e.g., agriculture, cement, steel, aviation or maritime transport) reducing emissions is challenging. Despite efforts, hard-to-abate sectors still heavily rely on fossil fuels, and clean energy solutions are not widely available. Hence, it is unlikely to eliminate the sector’s carbon footprint completely by 2050.

Here is where carbon capture utilisation and storage technologies (CCUS) step in, helping achieve net-zero goals either through underground storage or offsetting emissions, such as tree planting. Picture it like a big eraser – balancing what we emit with what we erase. However, the lack of oversight and varying quality has been raising concerns over the risk of greenwashing.

With climate change escalating, the new certification framework aims to rectify these issues, ensuring transparency and effectiveness. It also seeks to attract private investments, essential for the CCUS technologies. Balancing verification, affordability, and incentives is critical for the success of the EU’s carbon removal technologies, crucial for reaching carbon-neutral goals.


CCS: a rising star towards COP28

The debate on CCS intensifies as COP28 approaches. Promoters, including energy, government, and UN agencies, argue that CCS is crucial to fighting climate change, with the technology set to feature prominently at the upcoming conference. However, environmental groups and some journalists oppose CCS, raising concerns about its viability.

The discussion extends to the EU, where Spanish Presidency faces criticism for allegedly undermining CCS adoption, questioning its compatibility with energy efficiency principles. The focus remains on CCS’s role in addressing unavoidable emissions in hard-to-abate sectors with ongoing scrutiny and calls for a balanced approach in funding. The question lingers: Is CCS the indispensable solution or a potential “licence to pollute” for industries?


What’s next?

The European Parliament will vote on its position on CFCR during the plenary at the end of November, while the Council of the EU aims to reach the General Approach in December. This would leave co-legislators less than three months to find a Trilogue agreement before they suspend legislative works in view of the European elections.

Early next year, the European Commission will also publish an initiative on industrial carbon management setting out a strategy for environmentally sustainable carbon capture, utilisation and storage deployment. The next Commission will oversee executing the strategy and present possible new legislative initiatives on CCUS.

Policy update

Policy update

Euro 7 heats up in the Parliament

MEPs adopted in Plenary its position on the regulation for type-approval of motor vehicles and engines with respect to their emissions and battery durability, the so-called Euro 7. The new regulation will update current limits for exhaust emissions (such as nitrogen oxides, particulate matter, carbon monoxide, and ammonia), and will introduce new measures to reduce emissions from tyres and brakes, and increase battery durability.

The non-CO2 legislation will be weaker than what the European Commission originally had in mind and caused a heated debate in plenary. On the one hand, MEP Bas Eickhout (Greens) called the report of Rapporteur Alexandr Vondra (ECR) a prime example of greenwashing, wishing to have included more stringent exhaust emissions limits for cars. MEP Christel Schaldemose (S&D) found ‘embarrassing’ that the report puts cars before people.

On the other hand, MEP Vondra described the report as balanced by including the recognition of carbon-neutral fuels. Following the vote, interinstitutional negotiations (Trialogue) will commence between co-legislators.


EU takes the fast lane to greener freight transport

The European Commission published the long-awaited proposal to enhance the sustainability of freight transport. The revision of the Combined Transport Directive, part of the Greening Freight Package, aims to reduce negative environmental impacts of freight operations by at least 40% compared to road-only transport.

Digital platforms established under the electronic freight transport information Regulation (eFTI) will provide a calculation tool to prove whether the operation is eligible for specific combined transport support.

To improve infrastructure usage, combined transport will also be exempted from temporary driving bans (e.g., weekend driving). Member States are tasked with setting national measures to reduce combined transport costs by 10% within seven years. The European Parliament and Council of the EU will soon commence separate discussions on the proposal.


EU aims for ambitious climate agreement at COP28

COP28 kicks off in Dubai on 30 November. For the last couple of weeks, the EU has been working on multiple fronts in preparation for the summit. Spanish Deputy Prime Minister Teresa Ribera, who will represent the EU 27 at COP28 emphasised the EU’s goal to create concrete pledges to peak global emissions and commence the phasing out of oil, gas and fossil fuels starting with a full stop on new coal power plants.  

One of the hot balls at COP28 is the loss and damages fund, which has been in the works for nearly two decades. The fund aims to channel money to nations most vulnerable and impacted by the effects of climate change. Head negotiator Ribera hopes that the EU’s new renewable and energy efficiency targets will aid in the development of the fund. The UNFCCC Transitional Committee on Loss and Damages was able to reach a small breakthrough with an agreement on a list of recommendations for implementing the fund which will be taken forward at COP28.

Many have already criticised the deal as the U.S. wants to finance the fund on a voluntary basis and the World Bank will host the fund for a four-years interim basis. The question is whether countries will be able to reach an agreement on the final form of the loss and damage fund at COP28.


Bioenergy is booming across the EU

A new report published by the Commission outlines the continued rise of bioenergy in the EU’s energy mix. Bioenergy produced from agricultural forestry and organic waste feedstock remains the biggest source of renewable energy in the EU, accounting for 59% of the renewable energy consumption in 2021.

Bioenergy consists of solid and liquid biofuels, biogas/biomethane and renewable share of municipal waste. Solid biofuels make up most of this mix at 70%, followed by liquid biofuels (13%), Biogas/biomethane (10%) and renewable share of municipal waste (6.6%)

In line with the REPowerEU plan, most Member States reported having taken measures to increase their production of biogas and biomethane, with Germany, Italy and France as its largest producers. Despite not producing bioenergy, Finland and Sweden are major suppliers of agricultural biomass which represents 8% of the complete solid biomass supply.


Member States lagging behind 2030 energy efficiency targets

A new report reveals that none of the Member States are fully in compliance with the latest energy efficiency targets, set in the recent adopted Energy Efficiency Directive (EED). Only 16 Member States have met the June deadline to submit updated National Energy and Climate Plans (NECPs) to the European Commission for the period up to 2030.

The report states that only four out of 16 NECPs – namely Italy, Lithuania, Luxembourg, and Spain – have submitted plans that are nearly aligned with the requirements of the updated EED. Remarkably, Denmark, Finland, the Netherlands, and Sweden only acknowledge the existence of EED and fails to update their plans to the new provisions.

Given that three months after the deadline for the draft plans there are still 11 NECPs missing, the European Commission is exploring the next legal follow-up options. Originally, the European Commission planned to assess each NECP individually and provide country-specific recommendations by the end of 2023, six months before the last deadline for submitting final NECPs, in June 2024.

What’s next?

  • From 20-24 November it’s European Hydrogen Week, which includes a multi-day conference with over 25 sessions and 200 expected speakers to deep dive into all types and applications of hydrogen.
  • During the Plenary session on 20-23 November, the European Parliament will have a debate and vote on the CO2 for HDV Regulation and carbon removal certification.
  • On 29 November, the European Commission will publish its action plan to facilitate grids roll-outs.
  • From 30 November – 12 December COP28 will take place in the United Arab Emirates.


Fit for 55 package: the EU energy and climate legislation at a glance

The Fit for 55 package is a landmark piece of legislation, setting concrete obligations to achieve at least 55% greenhouse gas emissions reduction by 2030, compared to 1990 levels. Now, more than two years after its publication by the Commission, almost all 15 proposals of the package have been completed, placing most sectors of the economy on a trajectory towards net zero. With most proposals soon entering into force, Member States will be required to implement all the agreed-upon regulations.

Fit for 55 package: the EU energy and climate legislation at a glance
Events update

Events update

Where can you run into our team?

On 14-16 November, you can grab a drink with our colleagues Arnaud, Andreas and Martijn who will join the Mobility and Energy events at Politico’s Sustainable Future Week.

Sara Orcalli

Sara Orcalli

Hi, my name is Sara and I am curating the Energy & Climate Policy Update to bring you the latest news on ‘Fit for 55’ as well as energy and climate insights. Do not hesitate to reach out should you have any questions or if you want to know how EU energy and climate policies might impact your business.