Looking Back 2022: The Introduction of the REPowerEU Plan/
Looking Forward 2023: Increasing investment in Existing Climate Mitigation Funds
Russia’s war on Ukraine created significant uncertainty within the EU regarding how it is going to produce enough energy to power itself through winter while still maintaining its ambitious climate goals. The EU’s previous reliance on Russian fossil fuels highlighted the need for the development and improvement of renewable energy resources, and one of the most pivotal EU climate events that took place in 2022 was the introduction of its REPowerEU plan.
The three points that the REPowerEU plan focuses on are saving energy, producing clean energy, and diversifying the EU’s energy supply. The mission of the REPowerEU plan is to reduce the EU’s dependency on Russian fossil fuels, speed up the green transition, and increase the resilience of the EU’s energy system. The plan includes a mix of short-term and medium-term measures that should be completed by 2027. Some of the short-term actions that are a part of this plan include creating new energy partnerships with reliable suppliers that include future cooperation on renewables and low carbon gases, the rapid rollout of solar and wind energy projects combined with renewable hydrogen deployment that will save approximately 50 billion cubic meters (bcm) of gas imports, and an increase in the production of biomethane that will save 17 bcm of gas imports. Some of the medium-term actions that are a part of the REPowerEU plan include EU member states creating new national REPowerEU plans under the modified Recovery and Resilience Fund that will support investment and reforms, boosting industrial decarbonization with €3 billion of frontloaded projects under the EU’s Innovation Fund, and increasing the EU’s renewable target for 2030 from 40% to 45% of the EU’s total energy supply. Under the RePowerEU plan, the EU’s total renewable energy capacity for 2030 will be 1,236 gigawatts (GW) as opposed to the 1,067 GW that was delineated in the EU’s previous Fit for 55 legislation.
Moreover, the REPowerEU plan’s Solar Energy Strategy aims to bring over 320 GW of solar photovoltaic energy online by 2025, which is over two times the capacity that is available today. Through this, the EU projects that it will lessen its annual gas consumption by 9 bcm. In order to achieve its solar power goals, the EU formally created a European Solar PV Industry Alliance on December 9, 2022. This alliance is being led by a Steering Committee, which is composed of the European Commission, the European Secretariat, as well as SolarPowerEurope and the European Solar Manufacturing Council. Therefore, SolarPowerEurope and the organizations that comprise the European Solar Manufacturing Council, such as IPVF, Oxford PV, and Midsummer, will be important actors moving forward in the EU achieving its renewable energy goals. On a larger scale, the European Investment Bank, contributions from the EU’s member states, and private investments will also be pivotal in ensuring that the EU has the funds necessary to finance and revitalize its renewable energy resources.
As such, one of the most important areas that the EU should focus on in 2023 related to climate change is increasing the amount of investment in funds that are aiding the EU in mitigating climate change, such as Cohesion Policy funds, the Innovation Fund, and the European Agricultural Fund for Rural Development. While there are EU climate policies that could be strengthened, the EU’s climate legislation places it on the right track to achieve its 2030 and 2050 climate goals. However, these goals will not be met if there is not enough money available to fund the proposed innovative technologies and renewable resource developments. In order to increase the amount of funding that is available in funds like the Innovation Fund, the EU could more drastically decrease its Emissions Trading Systems (ETS) allowances, which would increase the revenue it has available to invest in the Innovation Fund. Further, incentivizing member states to greater investments in the aforementioned funds will be crucial in the EU increasing its overall funding capacity. EU outreach to relevant climate organizations and potential donors who have an interest in climate change mitigation, such as the European Environmental Bureau, International Friends of Nature, and Climate Action Network Europe, would be useful in acquiring the additional €210 billion of investment that is needed between now and 2027 in order for the EU to achieve the steps outlined in its RePowerEU plan and to reach its 45% renewable target.
Learn More Resources
Image Source: https://www.bbva.com/en/bbva-joins-a-european-letter-to-promote-renewable-energy-in-the-sustainable-recovery/
This Post was submitted by Climate Scorecard EU Manager Brittany Demogenes