European Green Deal Law Aided In Increased RE Deployment: Report

The European Union (EU) shared a report titled ‘The State of the Energy Union’ 2023, by the European Commission. The report looks back on the EU response to the unprecedented energy crisis of the past two years. It assesses the state of play with the green transition at the national and global levels. It further sets out the challenges and opportunities ahead as Europe pursues its ambitious climate and energy goals for 2030 and 2050.

The report shows how the EU responded collectively and effectively to Russia’s aggression in Ukraine and weaponization of its energy supplies by accelerating the clean energy transition, diversifying supplies, and saving energy. The report shares the REPOWEREU Plan and emergency legislative measures that ensured that Europe avoided energy supply disruptions. The report shared the effect of the legislation on easing pressure on energy markets, prices, and consumers and pursued structural reform of our energy system.

The report states that the European Green Deal legislation has increased the deployment of renewable energy and improved energy efficiency. The report also finds that the EU is on track to deliver on its REPowerEU targets. The report mentions that the EU is ahead of its winter 2023–2024 and is better prepared to ensure its energy security. The report attributes its success to well-coordinated actions to fill gas storages, diversifying energy import routes and infrastructure, investments in renewable energy and energy efficiency, and collective efforts to reduce energy demand..

Key figures on the State of the Energy Union:

• The EU’s net greenhouse gas emissions decreased by around 3% in 2022, reaching a reduction of 32.5% compared to 1990 levels.
• The EU drastically reduced its dependence on Russian fossil fuels by: phasing out coal imports; reducing oil imports by 90%;
• Reducing gas imports from 155 bcm in 2021 to around 80 bcm in 2022 and to an estimated 40–45 bcm in 2023;
• The EU reduced gas demand by more than 18% compared with the previous five years, saving around 53 bcm of gas.
• Gas storage facilities were filled to 95% capacity ahead of the winter of 2022-2023 and stand at over 98% full today, ahead of the coming winter.
• The EU Energy Platform organized three rounds of joint purchases of gas, collecting 44.75 bcm of demand and matching it with 52 bcm of supply offers;
• 2022 was a record year for new solar photovoltaic (PV) capacity (+41 GW), which is 60% more than in 2021 (+26 GW). New onshore and offshore wind capacity was 45% higher than in 2021.
• In 2022, 39% of electricity was generated by renewables, and in May, wind and solar surpassed fossil fuels for the first time in EU electricity generation.
• Legislative targets were agreed upon for a minimum share of 42.5% of renewable energy in the EU by 2030, with the ambition to reach 45%. Energy efficiency targets were also increased to reduce final energy consumption by 11.7% by 2030.

Future Challenges and Opportunities

The report states that, after the end of the worst effects of the energy crisis, there is no room for complacency. Therefore, the EU needs to continue to ensure affordable, reliable, and accessible energy for households, supporting investments in clean technologies. While gas prices peaked in August 2022 at €294/MWh, they fell to an average of €44/MWh from January to June 2023. The report finds that electricity prices peaked at €474/MWh in August 2022 and fell to an average of €107/MWh from January to June 2023. Therefore, the report emphasize the need for an EU legislative framework for member states to implement their shared commitments and the National Energy and Climate Plans (NECPs).

This year’s report, in its first assessment of the progress reports that were submitted by member states in 2019, presented the national energy and climate plans. This plan takes stock of the EU’s stand on delivering its climate and energy ambitions. The report forecasts that the commission is awaiting several member states to submit their updated NECPs. The report assessment by the end of this year would determine whether or not we are on track for achieving our revised 2030 targets and what measures would be needed to address any shortfalls.

The report emphasizes the need to accelerate actions to increase renewable energy consumption. The report finds the gross final energy consumption to have reached 21.8% in 2021. This brings an average yearly increase of 0.67 percentage points since 2010, reaching the new 2030 EU target of 42.5%. The report indicates that the declining trend in greenhouse gas emissions, which continues to fall steadily each year, needs to pick up and almost triple the annual reductions to meet our 2030 targets.

The ‘State of the Energy Union’ report highlights the importance of boosting the EU’s competitiveness and industrial leadership in the new global energy context and of concluding legislation. These legislations are on the electricity market design, net-zero industry act, and critical raw materials act in particular. These proposals will complement the ‘Fit for 55′ legislation and support the development of clean energy sources, grids, and stable markets across Europe. The recently launched clean transition dialogues with industry will be an important tool for implementing legislation and identifying and addressing bottlenecks such as investment barriers or skills shortages. The Commission will also work with Member States to pursue the phase-out of fossil fuel subsidies as soon as possible, which remains a major obstacle to the clean energy transition and a drag on our climate objectives.