Holger Lösch (BDI), Niels Anger (BMWi), Michèle Knodt (TU Darmstadt), Daniela Niethammer (ESYS Project Office), Sabine Schlacke (WWU Münster), Christoph Böhringer (University Oldenburg), Pieter de Pous (E3G) (f.l.t.r) and guests © acatech/Strutzberg

Scientific academies call for measures to support a climate-friendly energy supply in the EU

14. December 2018

The European Commission’s long-term strategy envisages a climate-neutral EU by 2050. The new governance regulation aims to achieve better coordination of EU climate and energy policy. But will this be enough to deliver the EU’s climate targets? The joint academy project “Energy Systems of the Future” (ESYS) believes that although the EU regulation is an important step, it will not be enough to pave the way for a climate-friendly European energy supply. In a Position Paper, ESYS proposes financial incentives to support climate protection, as well as sanctions for countries that fail to set sufficiently ambitious national climate targets. It also calls for the most committed nations to form alliances that can lead the way.

The European Union is aiming to achieve greenhouse gas neutrality and reduce its net emissions to zero in the next 30 years. In setting this target, the European Commission committed the EU to taking on a leading role in protecting our climate at the UN climate change conference. To what extent will the Regulation on the Governance of the Energy Union and Climate Action that was adopted by the European Council on 3 December 2018 contribute to achieving this goal?

The regulation requires all member states to develop integrated national energy and climate plans (NECPs) setting out their targets, strategies and measures for reducing emissions. If the plans or their implementation are considered to be unsatisfactory, the European Commission may recommend amendments, although these are not legally binding.

ESYS is a joint initiative of acatech – National Academy of Science and Engineering, the German National Academy of Sciences Leopoldina, and the Union of the German Academies of Sciences and Humanities. The ESYS project experts believe that the regulation does not go far enough. In their view, it will only be possible to ensure mandatory compliance with the plans if they are transposed into national law. According to Sabine Schlacke, “Germany’s energy and climate plan should become the central instrument of the forthcoming Federal Climate Protection Act. In addition, the national strategy for phasing out coal currently being formulated by the “coal commission” should be incorporated into the plan by the Federal Government”. Schlacke is Director of the Institute for Environmental and Planning Law at the University of Münster and co-chair of the working group that produced the position paper “Governance for a European Energy Union”.

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Driving coal phase-out and carbon pricing through leadership alliances

In the Position Paper, the academies of science recommend that Germany should closely coordinate its phase-out of coal-fired power generation with its European neighbours. By forming alliances with other nations that are committed to tackling climate change, Germany will be able to improve the coordination and reduce the cost of phasing out coal.

These leadership alliances could also support the introduction of global minimum prices for CO2 emissions across several different countries. A sufficiently high CO2 price that applies to all sectors would constitute an important step on the road towards greenhouse gas neutrality in Europe by creating financial incentives for low-carbon technologies. However, it has not yet been possible to build majority support for such a measure among policymakers. Christoph Böhringer, Professor of Economic Policy at the Carl von Ossietzky University of Oldenburg and co-chair of the ESYS working group, explains how a global CO2 price could be implemented, at least among alliances of leading nations: “Taking the current certificate price in the European emissions trading scheme as a basis, a sliding scale carbon tax could be introduced that would require emitters to pay a surcharge for every tonne of CO2 they emitted. This would mean that they would have to pay the desired minimum price per tonne of carbon dioxide emissions.” The members of the alliance could also use taxes or levies on primary energy sources to establish the agreed CO2 prices in the sectors not covered by the emissions trading scheme.

Sanctions for non-compliance, financial support for ambitious climate targets

There should be an option to sanction EU member states if they fail to draw up an NECP or if they produce a plan that falls short of what is required. To this end, the working group proposes an ingenious solution that links energy policy to structural policy in the EU. Michèle Knodt, Director of the Jean Monnet Centre of Excellence “EU in Global Dialogue” (CEDI) at the Technische Universität Darmstadt and co-chair of the ESYS working group, outlines a number of options. “In the EU’s budgetary and economic policy, funding is already linked to the delivery of certain targets under the European Semester framework. The European Commission should extend this model to the sphere of energy policy. Financial support from the European Structural Funds could be reduced or stopped if member states failed to meet their targets.” At the same time, additional financial incentives could be used to encourage member states to establish effective climate protection instruments. The Structural Funds should therefore increase funding for energy efficiency measures and provide financial support for regions that are particularly affected by structural change, for example lignite mining regions.

Environmental organisations should be granted the right to bring actions at national level so that they can hold their governments to account if they fail to produce energy and climate plans or if the plans lack the necessary ambition. Furthermore, regional and local government and the general public should be more closely involved in the development of the NECPs from an early stage. This will require pan-European guidelines for public engagement procedures in order to ensure that everyone has the same opportunity to participate.

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