Europe: EU’s strategies to reach the “20-20-20 Targets”

Posted on May 4, 2011 by

The objectives set by the current climate change legal framework of the European Union (EU) aims at achieving three targets (“20-20-20 targets”) by 2020. These targets are;

  1. A 20% reduction of green house gas emissions compared to 1990 levels
  2. A 20% reduction in primary energy use – based on projected levels – through improved energy efficiency.
  3. A 20% share of energy consumption originating from renewable energy sources.

1. First Target: Reduction of green house gas emission

At the European Council’s March 2007 summit, a target was agreed upon by the member states of the EU, that there should be a 20% (from 1990 levels) reduction in GHG emission by 2020. The EU also committed a 30% reduction target, but on the condition that an international climate change agreement is reached between developing countries, accepting the same target and that developing countries should also contribute adequately. The ultimate target for developed countries is a 60% to 80% (from the 1990 levels) reduction of GHG by 2050. To achieve these targets, several binding measures were adopted in 2009. These included the revised ETS Directive, the Effort Sharing Decision and the CCS Directive.


The revised ETS Directive

 Under this revised Emission Trading Scheme (ETS), the free allocation of emission allowances would be replaced by the auctioning of emission allowances for the 2013-2020 trading period. These allowances will be allocated on the basis of benchmarks that take the average performance of the 10% most efficient installations in 2007-2008 as a starting point. However, economically disadvantaged sectors like the energy-intensive sectors, that are subjected to significant risk of carbon leakage, would get 100% free emission allowances on the basis of the benchmarks describes above. The revenues generated for the auctions will go to public authorities, some of which will have to fund measures aimed to improve energy efficiency and stimulate the use of renewable energy.

Effort Sharing Decision

Under this decision, Non ETS sectors will have to cut down on GHG emissions by 10% compared to 2005 levels (e.g. Transport, agriculture, buildings and waste).  Different emission targets would be set as per the respective per capita GDP of the EU member states, together achieving the 10% EU-wide GHG emission target. Denmark, Ireland and Luxembourg have the most significant obligation: to reduce their emissions by 20% (beyond the ETS).


The CCS Directive

This directive provides the legal framework for the development and safe use of carbon capture and storage (CSS). This includes permit requirements, corrective measures for leakages, prohibitions and financial securities all of which covers the technologies used to capture and store industrial CO2 in underground geological formations. EU member states are required to transpose this directive into their legislature by 25 June 2011.

2. Second target: Improved Energy Efficiency

This measure aims at decreasing the utilization of energy whilst preserving an equivalent pace of economic activities. This target is particularly meant for the transport sector, energy-using equipments, energy consumer’s behavior, buildings and energy technologies/innovations.

Steps like the adoption of the Energy Efficiency Plan 2011,which encourages further use of energy management systems, and the proposed amendment to Energy Taxation Directive (April 2011) which aims at including CO2 emissions in the structure of the energy tax, are aimed at pushing different industries into a more energy efficient economy.

3. Third target: Increased use of energy from renewable sources

The 2009 Renewable Energy Directive has mandated a EU-wide mandatory target for the overall consumption of renewable energy (RE) and while targets vary for individual member states, the overall RE consumption over the EU should be 20% of the 2005 levels by 2020. To achieve their targets, Member states can avail four different forms of Voluntary cooperation mechanisms;

(i) statistical transfers of specified amounts of renewable energy from one member state to another;

(ii) joint projects between member states for the production of electricity, heating or cooling from renewable energy sources, which may involve private actors;

(iii) joint support schemes, by which two or more member states may coordinate their respective national support schemes on a voluntary basis (e.g. a common feed-in-tariff or green certificate/obligation regime); and

(iv) joint projects between member states  and third countries for the production of renewable electricity, which may involve private operators.

The adoption of the Communication on Renewable Energy and the Roadmap (2011) invites further investments in renewable-specific technologies through supplementary financing sources. The roadmap also encourages the EU to dedicate, by 2050, 1.5% of its total GDP per annum in low carbon energy sources, low carbon infrastructures and low carbon supporting systems (in addition to the 19% investments based on the 2009 GDP).

Other future initiatives include the EU endorsed “low carbon 2050 strategy” for reducing GHG in the EU by 80%-95% from the 1990 levels, by 2050.

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