Rhein on Energy and Climate

The EU is in the process of defining new climate targets for 2030. The Commission intends to make proposals before the end of the year, which Council and European Parliament should adopt before the end of the legislature in May 2014.

This process takes place in a new international environment:

  • The acceleration of climate change requires urgent and effective international action. That results unequivocally from the 5th IPCC conclusions on climate change presented September 27th. in Stockholm.
  • The international community is therefore under more pressure than ever to adopt comprehensive action against climate change. The EU should work on the hypothesis of an “international action plan” being adopted in Paris at the end of 2015.
  • The USA has taken over global leadership. It is acting energetically against climate pollution from coal power plants and motor vehicles.
  • China is becoming more aware of the disastrous consequences of its increasing climate pollution, though its action is still limited.

This new context obliges the EU to be much more ambitious than in 2007, when it decided on the triple 20 per cent targets (for greenhouse gas emissions, renewable energies and energy efficiency) for 2020.

Until 2050, the EU aims to lower its greenhouse gas emissions, above all carbon dioxide, by at least 80 per cent over 1990. To reach that target, emissions should fall by 45 per cent until 2030, 65 per cent until 2040 and 80 per cent until 2050.

The challenge that lies before European society on the path towards an essentially climate pollution-free economy by the middle of the century is stupendous.

Very few people visualise its full implications and the short time in which the challenges will have to be met. We behave as if we have an eternity before us to undertake the necessary changes and forget that less than a quarter century separates us from 2050, much shorter than the 40 years after the 1973 “oil crisis” .

A 2030 emission reduction target of more than 40 per cent over 1990 will be a shock to business and citizens. Some member States will vehemently oppose it. Still, the Commission should take the courage to propose it, if only to provoke a debate in Europe and the international community on the enormity of the challenges ahead and the short time in which the energy revolution must take place.

The target finally adopted will then have to be aligned on the ambitions of main climate polluters like China, USA, Japan, Russia, India, Brazil, Australia and Canada. Europe cannot operate in a vacuum! And it should never overlook that with only some 12 per cent of global emissions its policy will only have a marginal impact on global climate pollution.

To reach its target the EU must not bet exclusively on wind and solar, plus gas for base-load and storage. It must substantially reduce its energy demand through savings and higher energy efficiency and adopt concrete implementation measures for power, transport and buildings where big emission reductions are easiest to realise.

Without a dramatic increase of energy efficiency the EU shall not make it.

This should happen through a combination of higher energy prices, stricter energy efficiency standards for cars, trucks, air planes, machinery, buildings and new technologies forstoring renewable energies.

Fossil energy prices will have to rise progressively, through market forces and policy instruments. Policy makers will finally have no choice but to tell citizens that energy prices need to rise to help mobilise investments in energy efficiency and renewable energies.

The most urgent action for the EU to take is a substantial reduction of C02 emission certificates to raise their price to at least € 25/ton.

This should accelerate overdue closures of inefficient coal-power plants, especially in central Europe, and make subsidies for wind and solar power superfluous.

To facilitate the process the EU should establish binding efficiency standards (0.5 kg C02/kWh) for new and existing fossil power plants, as the USA is presently doing.

Member states should be free to continue operating nuclear power plants, provided these pay the full cost for insurance and nuclear waste disposal.

EU and member states should establish a more effective division of labour:

  • The EU should focus on basic policies concerning targets, energy efficiency standards in key sectors, international relations and, last not least, an effective functioning of emission trading and a rapid set-up of EU-wide power/gas grids and and electricity/gas exchanges, both of which are crucial for an optimal safety of supply across the EU.
  • Member states should be free to adapt EU standards to their particular conditions and, of course, implement the EU-wide climate climate-energy policies under the vigilant eyes of the European Commission.

Brussels 07.10.2013 Eberhard Rhein

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