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Policy

Europe Doubles Down on Transition to Curb Russia Reliance

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The European Commission has dispelled any notion that it might ease off on climate priorities given the urgency of efforts to move away from Russian gas dependence, with a new strategy update this week putting the energy transition front and center. “The quicker we switch to renewables and hydrogen, combined with more energy efficiency, the quicker we will be truly independent and master our energy system,” suggests Commission President Ursula von der Leyen.

“It is time we tackle our vulnerabilities and rapidly become more independent in our energy choices. Let's dash into renewable energy at lightning speed. Renewables are a cheap, clean, and potentially endless source of energy and instead of funding the fossil fuel industry elsewhere, they create jobs here,” said Executive Vice President for the European Green Deal Frans Timmermans as he launched the REPowerEU package.

The package aims to make Europe independent from Russian fossil fuels well before 2030 by diversifying gas supplies and booting volumes of biomethane and renewable hydrogen production and imports. It would also hasten a decline in fossil fuel use in homes, buildings, industry and the power system by boosting energy efficiency, increasing renewables and electrification, and addressing infrastructure bottlenecks. Here are some key elements:

Green Gases

To boost the production of biomethane, the REPowerEU plan would aim for 35 billion cubic meters of biomethane production by 2030, doubling the current EU ambition, using sustainable biomass sources such as agricultural wastes and residues. REPowerEU would also create a Hydrogen Accelerator, developing integrated infrastructure, storage facilities and port capacities. The commission estimates that an additional 15 million tons of renewable hydrogen can replace 25-50 Bcm per year of imported Russian gas by 2030. This would include around 10 million tons of imported renewable hydrogen from diverse sources and 5 million tons more renewable hydrogen produced in Europe, in addition to the 5 million tons already planned.

Solar, Wind and Heat Pumps

The commission estimates that by accelerating the rollout of rooftop solar PV systems by up to 15 terawatt hours this year, the EU could save an additional 2.5 Bcm of gas. It plans to present a dedicated communication on solar energy in June to unlock solar energy's potential. The commission also proposes to roll out 10 million heat pumps in the next five years to help European families reduce their dependency on gas and lower their energy bills.

Noting that investment in renewables is still too often hampered by long permitting procedures and other administrative barriers at the national level, the commission says it will also look at how regulatory bottlenecks can be eased to speed up renewable projects and grid infrastructure improvements. It aims to publish a recommendation in May on fast permitting for renewable projects, addressing the key barriers and developing practices to tackle them.

Similarly, the commission and the European Investment Bank Group will issue recommendations on the financing mechanisms that would be best suited to promote the development of power purchase agreements in Europe. A public consultation on both permitting and PPAs is currently ongoing and the guidance should be published before summer.

Energy Efficiency

Another pillar of the EU’s policy thrust is energy savings. The “case for energy efficiency has never been stronger," the commission suggests, as lowering energy consumption in households and enterprises means not only reducing energy imports from Russia, but also reducing energy costs for EU citizens and businesses. Simple measures, such as turning down heating thermostats by 1°C, could save 10 Bcm of gas within a year, according to a 10-point plan released last week by the International Energy Agency.

Other energy efficiency measures in the REPowerEU package, such as renovation of buildings, smart industrial processes, and better-managed, smart energy grids, could support additional savings of over 25 Bcm/yr.

Oil Overlooked

With its focus on reducing Russian gas imports, the REPowerEU package barely mentions oil. Campaign group Transport & Environment is thus calling on the EU to expand its strategy to reduce oil demand right now — such as through home working, speed limits and car-free days. It is also urging a redirection of recovery package funds and other measures to make electric vehicles (EVs) accessible to low and middle income families and businesses.

The EU is, however, looking to accelerate the progress of a separate battery regulation, which the European Parliament is due to vote on this week. Battery-makers hope this helps ensure an international level playing field based on innovative, competitive and sustainable batteries — and, in turn, hasten the transition to EVs and away from oil dependence.

Topics:
Hydrogen, Low-Carbon Policy, Renewable Electricity
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