EESC Position paper on the 2030 framework for climate and energy policies

1. 1
The European Union (EU) has set itself the objective of
reducing greenhouse gas emissions (GHG) by 80-95% by
2050. This is the EU's contribution towards avoiding
catastrophic climate change and limiting global warming
to 2ºC. Accordingly, the EU has adopted a
comprehensive policy package with an interim target of
a 20% reduction in GHGs by 2020, and the European
Commission is now proposing further targets for 2030 in
its Communication on the framework for climate and
energy policies.
In June 2014, the European Economic and Social
Committee (EESC) adopted four opinions covering
various aspects of the 2030 package (see box "further
information"). The Committee acknowledges and
supports the overall strategy, but calls for:
 an increased sense of ambition in the form of
nationally-set binding targets for the share of
renewables in the energy mix;
 decisive action in implementing a coordinated and
efficient energy policy, including the internal energy
market, through a European Energy Community;
 active encouragement of civic renewable energy by
Member States;
 enactment of protective measures for industrial
sectors at risk of carbon leakage in the absence of a
level global playing field.
However, it will take more to successfully address energy
and climate change challenges. Robust regulatory
measures must be complemented by the capacity of the
EU to create momentum globally and will require the
strong engagement of civil society.
This paper summarises the key EESC opinions on the
climate package and develops the recommendations
that the Committee considers to be crucial to transform
the EU into a highly competitive low-carbon economy.
Ambitious target-setting
The EESC supports the Commission's proposal to reduce
greenhouse gas emissions by 40% by 2030 as well as the
common target which requires that at least 27% of the
EU's energy needs should be covered by energy from
renewable sources. However, the Committee calls for
more ambition and advocates the adoption of specific
binding national renewable targets. Such targets
constitute the only transparent and effective way of
achieving the climate and energy objectives, given that
the Commission would be unable to enforce Member
States' compliance otherwise.
Energy efficiency is also crucial and a highly
cost-effective way to meet climate and energy policy
goals. The potential is high but radical action is required.
Sectoral targets should be considered, not least to tap
into the major efficiency gains possible in the building
and transport sectors.
Reduce GHG emissions by 40% by 2030 and produce at least 27% of energy from renewable
sources in the EU as a whole – while also setting binding national renewable energy targets. Define
sectoral energy efficiency targets, for example in the building and transport sectors.

2. 2
Market-based mechanisms, when properly implemented,
are also able to minimize the costs involved in the
energy transition. For example, when carbon prices more
closely reflect true carbon costs by incorporating
environmental and health externalities, cleaner
technologies and energy efficiency measures will
become more competitive and their market deployment
facilitated. The EU European Trading Scheme is an
example of such a carbon market, but it has been
suffering from a structural imbalance between supply
and demand of allowances that triggered a meltdown in
carbon prices and rendered the scheme ineffective. As a
result, the mechanism is under reform in order to
enhance its role in EU climate policies. The proceeds of
allowance auctions may also be beneficial if used to
support businesses during the transition towards a low
CO2 economy and the development and application of
clean technologies. Carbon markets should be part of
larger environmental fiscal reforms, including a shift
from taxing labour to taxing the use of resources.
The costs that will inevitably be incurred to achieve the
climate and energy targets should, nonetheless, be put
into perspective. As the Commission points out, they "do
not differ substantially from the costs that will be incurred
in any event because of the need to renew an aging
energy system, rising fossil fuel prices and adherence to
existing climate and energy policies".
But the long-term goals may only be achieved with real
technology leaps in many sectors. The EU and Member
States, as well as other financial players, must act
radically to tap this potential by supporting both
deployment of new clean technologies and attempts at
more risky breakthrough innovations. In fact, it is by
adapting to this challenge that the industrial sector can
remain competitive and conquer new ground.
Particularly in the field of renewable energy technology,
the EU should aim for no less than worldwide leadership.
Lastly, no reforms can be carried out without a stable
and predictable regulatory framework. In addition to a
consistent implementation, both are prerequisites for the
long-term decisions and massive investments that are
needed.
A consistent energy policy through a European Energy Community
The aim of the European Energy Community (EEC) is to
establish a political framework that can meet the EU's
energy objective to secure sustainable and affordable
energy. The proposal was first put forward by Jacques
Delors and the think-tank Notre Europe, and has recently
been taken up as the Commission president Mr Junker's
flagship Energy Union.
Establishing the EEC and completing the internal energy
market will require joint policy-making and coordinated
implementation between Member States, and a radical
increase in energy infrastructure interconnections. This
would enable the establishment of a truly integrated
European market by pooling energy resources and
coupling national day-ahead markets. The idea is to
complement the strengths and weaknesses of national
energy systems. For example, the base load provided by
conventional plants in one country should be more easily
combined with the peak load provided by renewables in
another country. The benefits of such a coordinated
policy are numerous and significant, namely improved
generation adequacy, security of supply, and
load-levelling. This addresses the intermittency of
renewable energy sources such as wind and solar, paving
the way for higher renewable shares. Moreover, the EEC
would establish a more equitable business environment
by progressively levelling out prices between regions
and countries.
Coordination of energy policies and projects is needed
not only within the EU but also in relation to
neighbouring countries, at least before adopting
decisions with far-reaching consequences.
Avoid the fragmentation of energy markets and infrastructure along national borders and
coordinate national plans with a view to securing the EU's energy supply at the lowest cost
through a European Energy Community.

3. 3
A governance system backed by a European Energy Dialogue
The EESC believes that the climate and energy objectives
can only be achieved at EU level through public
engagement, a robust governance system, transparency
and trust among all energy sector stakeholders and
society. The EESC therefore calls for a European Energy
Dialogue (EED) to enable both stakeholders and civil
society to contribute to policy making and
implementation. It will exert a measurable influence by
stimulating convergence at EU level and optimising
energy provision, costs and the achievement of climate
objectives. As part of the future governance system,
arrangements for public engagement with the EU
institutions and civil society must therefore be precisely
defined.
Dialogue, information and transparency regarding all the
benefits and factors of cost, risk, environmental impact
and social acceptance attached to any form of energy
are absolutely essential.
Support civic renewable energy production initiatives that
benefit regional development
Decisive action needs to be taken to diversify energy
supply and to decrease the EU's very high dependence
on unreliable sources of energy. This should be done by
focusing on renewable resources as they will continue to
be available in the long term and produce lower levels of
emissions compared to fossil fuels. Of particular interest
is the emergence of decentralised power generation by
citizens, communities, farmers, local authorities and
small businesses.
One of the first three impact assessments ever prepared
by the EESC researched how existing policies supported
civil society players as renewable energy producers.
These civic initiatives open up major opportunities for
linking climate action with local socio-economic
development. By providing affected parties with a new
source of revenues, local renewables tend to increase the
acceptance of energy infrastructure and trigger the
interest of small investors, thereby unlocking capital
funds needed for the energy transition. There is also
evidence that civic energy is a net creator of jobs and
economic growth.
By October 2014, the study team found no consistently
implemented government strategy aimed at supporting
civic renewable energy in any of the six visited Member
States. Policy instability and recent reforms of the
regulatory frameworks for renewables in those countries
had actually led to a slowdown in new investment and
concerns among stakeholders about the prospects for
Establish a solid governance and coordination system among the EU's Member States to deliver
the targets proposed in the 2030 framework. Civil society must be involved in policy making and
implementation through an inclusive, independent and transparent European Energy Dialogue
(EED). This will enhance ownership towards meeting the targets.
"The EU's climate objectives shall only be achieved through a
large-scale energy transition. Its success will depend on
everybody's engagement at an individual level. Collectively it
will require cooperation among all players, in particular on
R&D. This is why the EESC is promoting an inclusive,
transparent and coordinated European Energy Dialogue."
Stéphane Buffetaut, President of the EESC's Section for
Transport, Energy, Infrastructure and the Information Society
Ensure the direct involvement of civil society and local authorities in decentralised renewable
energy production. These initiatives unlock the potential for regional growth and job creation, and
enhance the social acceptance of climate and energy policies.

4. 4
achieving the renewable energy targets. The EESC has
also identified examples of best practice and
recommends that the EU and its Member States make
civic renewable energy a policy priority by:
 enacting long-term strategies, stable policy
frameworks and targeted support mechanisms for civic
energy;
 choosing appropriate mechanisms for supporting civic
energy such as regularly updated feed-in tariffs
combined with net-metering, and providing easy and
affordable connections to the grid;
 enforcing simple, quick and affordable administrative
procedures (civic energy projects should be exempted
from tenders and direct marketing obligations).
Avoid carbon leakage in EU energy-intensive industries
Many branches of energy-
intensive industries in
Europe are competing on
open global markets
which lack a level playing
field. Whereas industry in
the EU has to comply with
strict sustainability
regulations, in developing
countries and emerging economies those standards are
lower and allow for reduced unit costs. If energy-
intensive industries in the EU incur additional costs, their
competitiveness might be jeopardised, increasing the
risk of relocation and carbon leakage. Since EU
regulations have turned those industries into the most
energy and carbon-efficient at international level, carbon
leakage could lead to increased global emissions and
lower corporate sustainability standards.
In the short term, the EU's policies should aim to limit
and to offset increases in energy costs for
energy-intensive industries. In the long term, the
Committee recommends the adoption of a
comprehensive international climate agreement capable
of establishing a level global playing field for European
industry and of preventing carbon leakage.
Enact measures to avoid carbon leakage in EU energy-intensive industries, which in most cases are
already the most energy and carbon efficient in the world – at least until the adoption of a
comprehensive international climate agreement that establishes a level global playing field.
"In many Member States, civil society has been granted
limited opportunities to participate in the renewables
revolution. However, it is the collective power and motivation
of citizens, farmers, cooperatives, local authorities and small
businesses that can make the EU 2030 climate and energy
policies a success story. With the appropriate policy support,
civic renewable energy can become a driver for the transition
to a low-carbon economy."
Lutz Ribbe, President of the EESC's Sustainable
Development Observatory
Further information
 EESC webpage on the 2030 climate and energy package, including its Opinions
http://www.eesc.europa.eu/?i=portal.en.sdo-observatory-climateenergy
 Opinion of the Committee of the Regions on the 2030 climate and energy package
http://bit.ly/1DwGhLb
 European Commission webpage on the 2030 climate and energy package
http://ec.europa.eu/clima/policies/2030/index_en.htm
 EESC webpage on the impact assessment on the Renewable Energy Directive
http://www.eesc.europa.eu/?i=portal.en.sdo-observatory-red
 EESC webpage on the European Energy Community
http://www.eesc.europa.eu/?i=portal.en.energy-permanent-study-group
 EESC webpage on the European Energy Dialogue
http://www.eesc.europa.eu/?i=portal.en.energy-permanent-study-group-eed
 EESC opinion on market-based instruments
http://www.eesc.europa.eu/?i=portal.en.nat-opinions.30549