Energy Union and climate neutral solutions priorities for Energy Council

In terms of energy policy, Finland’s Presidency of the Council of the EU will focus on the implementation of legislation. The Presidency will also have an opportunity to lay down long-term policies especially on climate issues.

The presidency of the Council of the EU rotates among the EU Member States every six months. Usually, the next presidency in line inherits many of the legislative initiatives of its predecessors. However, the situation will a bit different when Finland takes over after Romania. The legislative initiatives of the Juncker Commission have largely been finalised. The energy issues still under discussion are mainly the regulation on improved tyre labelling as well as certain issues related to the scale of multi-annual financial programmes.

The EU as a global leader in climate action: objectives and means

A key priority for Finland’s Presidency is to strengthen the EU’s position as a global leader in climate action. According to our Presidency Programme, the EU should raise its profile as a global leader in climate action by adopting a long-term climate strategy aimed at making the EU carbon neutral by 2050.

A debate on how Europe should prepare for its long-term strategy was launched in November 2018 with the publication of the Commission communication A Clean Planet for all – A European strategic long-term vision for a prosperous, modern, competitive and climate neutral economy. During the Romanian Presidency, there was a broad-based exchange of views in several Council configurations. This process will continue during Finland’s Presidency.

In June 2019, the European Council invited the Council and the Commission to “advance work on the conditions, the incentives and the enabling framework to be put in place so as to ensure a transition to a climate-neutral EU in line with the Paris Agreement that will preserve European competitiveness, be just and socially balanced, take account of Member States’ national circumstances and respect their right to decide on their own energy mix”. The aim of the EU Heads of Government is to define the key elements of the long-term strategy in the European Council by the end of 2019, so that it can be adopted in early 2020 and submitted to the Secretariat of the United Nations Framework Convention on Climate Change. The role of Finland’s Presidency will therefore be to drive forward this work.

In keeping with both the spirit and the letter of the Paris Agreement, global challenges require solutions where everyone is on board. In addition to pursuing its own ambitions, the EU should aim to find cost-effective and high-impact solutions together, for example to promote low-carbon energy solutions. After all, energy production and consumption account for some 75% of all greenhouse gas emissions. The Presidency Programme indeed mentions that “integrating climate policy in all sectors is a key objective and includes implementing the Energy Union and promoting opportunities for further emissions reductions”.

Focus on effective implementation of the Energy Union

The Energy Union covers several areas, such as energy security, the internal energy market, energy efficiency, decarbonisation, and research, development and innovation. The EU recently adopted the last pieces of legislation that make up the Clean Energy Package, which the Member States are now starting to implement.

The governance mechanism of the Energy Union will be of particular use in achieving common targets for energy efficiency and renewable energy. Under the governance rules, Member States are required to submit integrated national energy and climate plans (NECPs) to the Commission. The Commission has already assessed the draft NECPs. The Commission also recently published a communication assessing the draft NECPs, stating that we are at Union level about 1–2 percentage points behind the 32% target for renewable energy and about 6 percentage points behind the 32.5% target for energy efficiency.

The specific recommendations published together with the Commission communication will be discussed in the first Transport, Telecommunications and Energy Council of Finland’s Presidency on 24 September. Also on the agenda are the preparation of the long-term climate strategy, post-2030 commitments and technological solutions promoting climate neutrality. Member States have until the end of 2019 to submit their final NECPs and long-term strategies.

Climate neutrality will require new solutions across sectors

Technology for climate-neutral solutions, if implemented in a controlled manner and with a long-term perspective, can also boost the EU’s economic growth and competitiveness in the coming decades. This was also evident at the Informal Meeting of Ministers Responsible for Competitiveness on 4–5 July in Helsinki, where one of the main themes was a competitive and climate-neutral Europe.

Research, development and innovation funding at EU and national level plays an important role in the development and deployment of solutions promoting climate neutrality. Electrification, smart grids and resource wisdom are key themes for the future. One of the major challenges facing us is transforming energy-intensive industries into low-carbon industries. These issues of technology will be discussed during the SET Plan Conference to be held on 13–14 November in Helsinki.

The transition to a carbon neutral economy, in general, requires action in all sectors, not only in the energy sector but also in transport, agriculture and financing. In addition to emission reductions, increasing attention should be paid to carbon sinks, especially forests and soils. This is true also in Finland. The new Government has set an ambitious goal that Finland will be carbon neutral by 2035.

Riku Huttunen is Director General of the Energy Department at the Ministry of Economic Affairs and Employment.