The fight against global warming[1] and the reduction of greenhouse gas emissions is a top priority for the European Union.
1) Why make it a priority?
- The global average temperature is expected to increase by between 1.1ºC and 6.4ºC in the 21st century without action to reduce greenhouse gas emissions.
- Human activities (the use of fossil fuels, deforestation and agriculture) are the source of greenhouse gas emissions. These gases trap the heat reflected off the surface of the Earth, which results in global warming.
- According to scientific studies, the risks of irreversible and catastrophic change would considerably increase if global warming were to exceed a 2ºC rise above pre-industrials levels.
- The cost of inaction would be greater than the cost of managing climate change: at least 5% of global GDP (up to 20% in worst-case scenario) versus 1% of global GDP every year[2].
2) What measures does the EU take?
The EU’s first package of climate and energy measures was adopted in 2008 and set 3 targets for 2020 : 20-20-20 targets
- reduce greenhouse gas emissions by 20%
- increase the share of renewable energies to 20%
- improve energy efficiency by 20%
To ensure more certainty for investors, the 2030 climate and energy policy framework has been adopted. The goal is to make the EU’s economy and the energy system more competitive, secure and sustainable and encourage investment in green technologies. It sets 4 important targets[2]:
- Reducing greenhouse gas emissions by 40% by 2030 relative to 1990 levels
- At least 27% renewable energy in energy consumption in 2030
- At least 27% improvement in energy efficiency in 2030
- Completion of the internal energy market by achieving a minimum target of 10% of electricity interconnections by 2020, and the objective to reach a 15% target by 2030.
3) What is the EU Emissions Trading System (EU ETS) and what is it for?[3]
It is a key EU policy instrument for fighting climate change. It is based on the ‘cap and trade’ principle : a ‘cap’ is set on the total amount of GHG emissions that can be emitted by the more than 11 000 installations. Thus, companies can emit a limited amount of greenhouse gases. With the system, each industrial sector can buy emission allowances auctioned by the Member States. It means that one installation may purchase unused credits from another facility. The goal is to encourage the reduction of greenhouse gas emissions.
With the economic crisis, there was a surplus of quotas because of a decline in demand for these quotas. A market stability reserve (MSR) was then created to counter imbalances between supply and demand for allowances.
4) What are the international agreements on climate change?
The EU and the 28 Member States are signatories of 3 treaties:
- United Nations Framework Convention on Climate Change (UNFCCC)
- Kyoto Protocol
The Paris agreement on climate change: it plans to limit global warming « well below » 2°C compared to pre-industrial levels[5].
Laura Van Lerberghe
[1] La lutte contre le changement climatique dans l’UE, https://www.consilium.europa.eu/fr/policies/climate-change/
[2] http://www.europarl.europa.eu/factsheets/en/sheet/72/climate-change-and-the-environment
[3] https://www.consilium.europa.eu/en/policies/climate-change/2030-climate-and-energy-framework/
[4] http://www.europarl.europa.eu/factsheets/en/sheet/72/climate-change-and-the-environment
[5] https://www.consilium.europa.eu/en/policies/climate-change/timeline/
