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What's EUp in June 2018?

By David Donnerer on 1 June 2018

Reshuffling the power dynamics in EU energy politics

A year ahead of the European elections, a recent series of political upheavals has radically changed the EU energy transition landscape. New governments in Italy and Spain have taken power and appear to shift their stance in favor of progressive energy and climate policies for the local energy transition. Spain’s new minister for the ecological transition, Teresa Ribera (formerly director of the French sustainable development think tank IDDRI), is supporting a high EU ambition on renewables and energy efficiency, and has put forth plans to scrap the infamous Spanish ‘sun tax’ which has long penalised solar self-consumption for Spanish energy citizens.

Meanwhile, Germany is no longer the Energiewende light house it used to be. The old-new government under chancellor Angela Merkel has poured cold water on the European climate and energy ambitions by backpedaling on supporting local energy and renewables - a policy shift spearheaded by the new conservative minister for economy and energy Peter Altmaier. As a result, Rainer Baake, Germany’s Mr. Energiewende as state secretary in the same ministry, has thrown in the towel in frustration and left the German government. On top of that, Germany will fail to deliver on its 2020 CO2 emission reduction target, according to the latest government figures. After a turbulent spring, we have to look towards the South of Europe as new beacons for local energy…

What about the 3Ds?

Democratisation

On 14 June, the EU Parliament, the Council under the Bulgarian presidency and the EU Commission reached a landmark deal for energy democracy in the negotiations on the next renewables directive. The new set of rules for renewable energy provide for the first time ever an explicit role for energy citizens and communities in the share of renewables in Europe. Citizens, local authorities and cooperatives will be able to produce, consume, store and sell their own renewable energy without being subjected to excessive administrative burden, taxes or fiscal requirements. Households that self-consume renewables below the threshold of 25 KWh without feeding it into the grid are also exempt from paying grid charges.
The revised renewable energy directive also sets the EU a binding target to increase the share of renewables to 32% by 2030 (with the possibility to revise upwards in 2023). In addition, it phases out the use of palm oil in the transport sector. In a next step, the directive has to be transposed by EU Member States in their national legislation.

The EU renewables agreement comes at a critical time, as the uptake of renewables is stagnating worldwide, according to a recent REN21 report. In other news, a new law on energy communities adopted in Greece is set to boost energy democracy, while in Croatia, the ZEZ energy cooperative successfully raised the required funds to implement thecountry’s first renewables crowdfunding project in the town of Križevci.

Just before the end of the Bulgarian Council Presidency, the EU institutions also brokered an agreement on the future of the Energy Efficiency Directive (EED). EU lawmakers agreed on a non-binding 32.5 % goal of energy efficiency savings by 2030, which includes a revision clause in 2023 for higher ambition. Moreover, Member States have to deliver 0,8% in annual energy savings after 2020. The EU has completed thereby its legislation on energy efficiency, as the revised energy performance of buildings directive has already been negotiated and will enter into force on 9th of July – for more details, read here.

On 26 June, negotiations on the future design of the European energy market are kicking off, where the major challenge will lie in safeguarding and strengthening provisions for energy democracy. Through our involvement in the cross-sectorial ‘Small is Beautiful’ campaign and the Community Power Coalition, Energy Cities and its partners will fight to preserve an enabling framework for small-scale, individual and collective energy initiatives.

To influence the process: Ask Energy Cities’ help to write a draft letter to your national representatives, or for media action in your country!

Divestment

Let’s look at EU Commission’s budget proposals for the period 2021-2027, published in May and June. Good news first: despite Brexit, the EU Commission has proposed more funding for the local energy transition, especially through the new LIFE and Horizon Europe funding programs. Bad news: as only 1 out of 4 Euros spent will go to fund climate action, the proposal is far from making EU funds compatible with the Paris Agreement. For more detail on how the Commission’s budget proposals will benefit cities’ energy transition, read Energy Cities’ breakdown of the new budget here. The next budget also foreshadows a shift in Europe’s funding structure – not only in terms of areas of intervention, but also geographically. Billions are poured into bolstering up new priorities (defense, migration and security), while agriculture and Cohesion policy have to face cuts. Through a reshuffling of funding allocation criteria in Cohesion policy, Italy, Spain and Greece are set to gain an estimated EUR 30 billion, to the detriment of Eastern European countries.

With the EU budget proposal out, debates on the future of European funds are heating up across Europe. A new citizen-driven alliance, the European Finance-Climate Pact, seeks to rally finance and policy to tackle climate change. In parallel former top EU officials are calling on the EU to finally bring fossil fuel polluters to properly pay for their share in fueling climate change. Meanwhile, the EU Parliament’s economic committee pressures the European Investment Bank, known for supporting fiercely contested gas infrastructure projects, to make its investments Paris-compatible, by ceasing lending to carbon-intensive projects. In other news, the coal lobby in Poland and Slovakia is undermining efforts to phase out coal and sidelining citizens and communities in the process.

To influence the process: Tell us what worked for you in the previous European budget, and what could be improved!

Devolution

The EU institutions have also managed to reach an agreement on the Governance of the EU Energy Union regulation under the Bulgarian presidency. The good news is that thanks to the Governance regulation, local authorities will be enabled to participate in designing national energy and climate futures. The bad news is that the provision is formulated quite vaguely, leaving a lot of room for “flexible” interpretation by Member States. Read here our analysis of this key legislative component of the EU Clean Energy for all Europeans package.

Following the Governance agreement, the EU Commission is preparing a new 2050 strategy for ‘long-term emissions reduction’ before the COP24 climate summit in Katowice. This strategy should be Paris-compatible, meaning carbon-neutral. Have a look at Paris’ 2050 climate plan to get an idea of how 2050 carbon-neutral translates into concrete measures.

Still in France, the energy transition network CLER, local leaders and the renewables industry have recently called upon the French government to better spread the development of solar on the entire French territory. Regionally differentiated feed-in tariffs could prevent favoring installations only in profitable areas. And in Portugal, a new wave of remunicipalisation is in the making, as local authorities are renegotiating until end of 2018 all their grid concessions for the 20 years to come. Energy Cities is accompanying Portuguese municipalities in this process, and will organise a workshop on this topic in Lisbon on the 2nd of July.

To influence the process: How should the new 2050 EU decarbonisation strategy be designed, and what role do you see for local actors? Share your thoughts with us!

Locally yours,
David
david.donnerer@energy-cities.eu

with the support of ADEME

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