EU’s clean energy package is progressing – deals reached on energy efficiency and governance mechanism

On 29 June 2018, the EU’s Permanent Representatives Committee (Coreper) endorsed the agreement reached on the revision of the Energy Efficiency Directive and the Governance of the Energy Union Regulation. It had already approved the deal on the Renewable Energy Directive on Wednesday.

This means that the EU Member States confirm the unofficial deals reached in the trilogue negotiations between the Council, the European Parliament and the European Commission concerning these three legislative proposals in the EU’s Clean Energy for All Europeans package.

“The agreement means a major step towards the Energy Union. The deals on three key proposals in the clean energy package mean that we have now agreed on common tools to reach the EU’s emission reduction targets for 2030,” Minister of the Environment, Energy and Housing Kimmo Tiilikainen says.

The deals will be confirmed officially in July by the European Parliament and the Council.

Energy efficiency target for 2030 of 32.5%

The compromise reached on the Energy Efficiency Directive (EED) will set a common, non-binding energy efficiency target for 2030 of at least 32.5% compared to the baseline scenario. The EU Member States will be obliged to increase their annual energy savings by 0.8% for the period 2021–2030.

“In Finland, the voluntary energy efficiency agreements between the state, local authorities and business and industry will generate most of the required energy savings by 2020. Efficient implementation of these agreements in companies and municipalities will play a key role in Finland’s future ability to meet its obligations under the directive,” Minister Tiilikainen says.

“Efficient energy use is an excellent way to save money and the environment and mitigate climate change. The now agreed energy efficiency targets will spur on to find even better ways to save energy and use them at home, at work and in transport,” Tiilikainen says.

The Commission’s proposal to amend the Energy Efficiency Directive, submitted on 30 November 2016, will create a legal framework for energy efficiency beyond 2020. It will also update the energy efficiency requirements for the period 2021–2030 and for ten years periods after 2030, unless reviews by the Commission conclude that this is not necessary to achieve the Union’s long-term energy and climate targets for 2050.

The level of the energy savings obligation and flexibility elements were the subject of long negotiations in six trilogues and technical meetings between the President of the European Council and the European Parliament. The conclusions were an annual energy savings obligation of 0.8% to Member States´s final energy use and a EU´s common energy efficiency target of at least 32.5%. The latter was a compromise between the Council’s proposal of 30% and the European Parliament’s proposal of 35%.

Governance mechanism to allow better monitoring of EU’s energy and climate targets

The Regulation on the Governance of the Energy Union will introduce a new governance process between the Commission and the Member States in the EU’s energy and climate policy. The Commission would monitor the progress in Member States’ own renewable energy targets, for example.

“It is a positive sign that a deal was reached on the governance regulation this spring. We have now the tools to monitor the clean energy package and the EU’s energy and climate targets for 2030,” Minister Tiilikainen says.

“It is good that the Commission will monitor both the progress in the EU’s common energy and climate targets and the Member States’ contribution to reaching the common goal. There is no denying that the administrative burden will get heavier, but for the sake of climate change mitigation it is important to monitor our progress,” Tiilikainen says.

The EU Member States are committed to reaching the EU’s renewable energy target for 2030. With the governance regulation, they will also commit to promoting renewable energy at the national level. Member States must promote their own national renewable energy targets, and the Commission will monitor their progress.

Keeping in mind that by 2030 energy from renewable sources should account for 32% of energy use, 18% of the target should be reached by 2022, 43% by 2025 and 65% by 2027.

“The agreement is a nice combination of ambition and incentives both for Member States already making headway in renewable energy use and for Member States at the tail end,” Minister Tiilikainen says.

During Austria’s EU Presidency, which is about to begin, the focus of the work on the clean energy package will be on the legislation dealing with the internal electricity market. Finland firmly supports proposals based on open market and price formation.

Inquiries:
Vilhartti Hanhilahti, Special Adviser to the Minister of the Environment, Energy and Housing, tel. +358 40 836 4823
Riku Huttunen, Director General, Ministry of Economic Affairs and Employment, tel. +358 50 431 6518
Juhani Tirkkonen, Senior Ministerial Adviser, Ministry of Economic Affairs and Employment, tel. +358 50 365 3412 (energy efficiency)
Pentti Puhakka, Ministerial Adviser, Ministry of Economic Affairs and Employment, tel. +358 50 511 7414 (energy efficiency)
Katja Tuokko, Senior Adviser, Ministry of Economic Affairs and Employment, tel. +358 50 465 553 (governance mechanism)
Pekka Grönlund, Senior Adviser, Ministry of Economic Affairs and Employment, tel. +358 29 506 4815 (renewable energy)