Overview of EU climate policy: past experience and future
prospects
Bangkok, 6 September 2012
Artur Runge-MetzgerDirector, DG Climate Action
European Commission
Outline
• EU domestic climate change policy• The context: Wider EU policy objectives• Starting point: Where do we stand?• Next steps: EU climate action 2013 – 2020• Planning ahead: EU Roadmap 2050
• International climate change policy• From Durban to Doha
• Conclusions
3
Wider EU policy objectives:Smart, sustainable and inclusive growth
• Innovation, jobs & growth• EU traditionally strong in manufacturing industries,
ensure continued leadership while other regions start investing in green growth
•Energy security• EU increasingly dependent on imported fossil fuels• Risks from high price of oil and gas
•Adverse effects of climate change will increasingly threaten future growth
Where do we stand?
• Decoupling of economic growth and GHG emissionsis happening.
• Since 2009, EU economy faces a deep economic and financial crisis.
50
60
70
80
90
100
110
120
130
140
150
1990 1995 2000 2005 2010
Ind
ex
(19
90
=1
00
)
GDP (EU-27)
Energy consumption(EU-27)CO2 emissions (EU-27)
GHG/GDP (EU-15)
GHG/GDP (EU-27)
5
EU climate action 2013 – 2020 (1)
Climate and Energy Package• enacted legislation for reaching -20% GHG by 2020
• conditional step-up to -30%• EU Emission Trading System as core instrument
• Increase share of renewable energy to 20 % by 2020• Improve energy efficiency by 20% by 2020
EU climate action 2013 - 2020 (2)
EU Emissions Trading System• Auctioning: mainly for the
power sector, use of auctioning revenue (eg NER 300)
• Benchmarking to avoid carbonleakage in industries at risk
• Registries• Inclusion of aviation• Address market imbalance
CO2(Energy production, refineries, industry(steel, cementetc.),Aviation);N2O (fertilizer)
EU climate action 2013 – 2020 (3)
• Including aviation into the ETS: timetable
• 2011• 26 December Deadline for Member States to publish
allocations of allowances to aircraft operators• 2012
• 28 February Issuing of free allowances for 2012• 31 March Submission by aircraft operators to
States of 2011 verified emissions report• 2013
• 28 February Issuing of free allowances for 2013• 31 March Submission by aircraft operators to
States of 2012 verified emissions report• 30 April Surrender of allowances equal to the 2012
emissions
EU climate action 2013 - 2020 (4)
Phase 2: EU ETS characterised by oversupply•4.5% increase in allowances issued•Trifold increase in the use of international credits for compliance (~ 550 million by 2011)•10% decrease in emissions
A surplus of 955 million units in 2011, expected to exceed 1.4 billion in 2012
EU climate action 2013 – 2020 (5)
Sectors outside the ETS• Implement national targets
(Effort Sharing Decision)• Emission performance
standards for cars and light duty vehicles for 2020
• Common accounting for land use, land use change and forestry
• Recast of F-gases regulation• Transport White Paper• Energy Efficiency Directive
CO2(Households, Services, Transport),CH4 (Waste, Agriculture),N2O (Agriculture)
EU climate action 2013 - 2020 (7)
Additional legislative proposals• Updating Monitoring Mechanism Regulation• Proposal for mainstreaming climate into next EU Multiannual
Financial Framework 2014-2020: min 20% of expenditure climaterelated• Regional funds• Common Agricultural Policy• Research and Innovation• Transeuropean infrastructure (energy and transport)• Development cooperation
• Maritime transport• Adaptation
• Clearing House Mechanism• Adaptation Strategy in 2013
EU Roadmap 2050 (1): Setting the level of ambition on the basis of science
• Globally halving emissions by 2050 cp to 1990• EU objective of reducing greenhouse gas emissions
by 80-95% by 2050 compared to 1990, in the context of necessary reductions by developed countries
• Need for a low carbon 2050 strategy as framework for longer term action
• Need to fix intermediary stages towards reaching the 2050 objective
• Need to keep developments under review on a regular basis
EU Roadmap 2050 (2): A cost-efficient pathway
0%
20%
40%
60%
80%
100%
1990 2000 2010 2020 2030 2040 20500%
20%
40%
60%
80%
100%
Current policyPower Sector
Residential & Tertiary
Non CO2 Other Sectors
Industry
Transport
Non CO2 AgricultureEfficient pathway:-25% in 2020-40% in 2030-60% in 2040
80% domestic reduction in 2050 feasible•with currently available technologies• If all economic sectors contribute
EU Roadmap 2050 (3):Benefits for growth and jobs
• Shift from fuel costs to investment expenditure• Innovation in key growth
sectors crucial for future competitiveness
• Potential net job creationup to 1.5 million by 2020
• GDP more secure from energy price shocks
GDP and GHG decoupling
40
60
80
100
120
140
160
180
200
220
1990 2000 2010 2020 2030
1990
= 1
00%
GDP GHG emissions
International (1): Durban outcomes
Implementation• Kyoto Protocol continues
• 2nd Commitment period: US, CA, RU, JP will not participate• Start on 1.1.2013, LULUCF rules, scope, improved CDM
• Cancun agreements are operational• Pledges, Transparency, Climate Technology Center
Network, Adaptation Committee, New Market Based Mex• Green Climate Fund
Negotiation• Durban Platform for Enhanced Action
• Negotiating a new legally binding agreement by 2015• Addressing the ambition gap until 2020
International (2): Towards DohaImplementation
• Kyoto Protocol• QELROs, length of commitment period, continuity for Kyoto
mechanisms, carry-over of surplus units
• Cancun agreements made operational• Progress on implementing pledges, ~ 100 countries
without pledges• Sources of funding up to 2020• New Market Mechanism
Negotiation• Durban Platform for Enhanced Action
• Work plan, especially 2013• Identify additional short-term mitigation action
International (3): New Market Mechanisms
Why?• Scale up of emission reduction efforts• Improve environmental integrity• Greater host country involvement
How?Host country• appoints authority, sets up MRV system and registry• defines sectoral scope, policy objectives (=baseline) and policy
instruments including incentive system• proposes crediting thresholds
UN • agrees on common set of rules, checks and balances (review of reports) • provides faciltation and guidance (standards, templates)• organises oversight (implementation, questions, recommendations)• Approves crediting thresholds and issues credits
International challenge: The Gap
Conclusions• EU will push ahead on designing and implementing
domestic climate policies. EU climate policies demonstratethat, if designed in a smart way, GHG emissions can bereduced while growing the economy in a sustainable and resilient manner.
• Credibility of the UNFCCC depends on (i) swift progress in the implementation of pledges under the Cancunagreements, and (ii) on identifying new mitigationinitiatives to close the ambition gap by the end of 2013.
• The success of the negotiations under the Durban Platformwill hinge on the collective capability to design and implement a new legally binding agreement that isenvironmentally effective, economically efficient, fair and politically acceptable.
19
Thank you for your attention!
More information:•
• http://ec.europa.eu/clima/
The EU has a comprehensive approach to address aviation’s climate impacts
• ATM Modernisation• Single European Sky• SESAR Joint Undertaking
• Research and Development of New Technology• Clean Sky Joint Technology Initiative (€1.6 bn over 7 years)• Sustainable alternative fuels
• New Standards• Through ICAO, e.g. new aircraft CO2 standard
• Market-Based Measures• EU Emissions Trading System
Includes direct support for aviation biofuels
EU ETS is compatible with ICAO’s approach• Incorporation of aviation into State’s existing
emissions trading system• Open system – access to emissions reduction in
other sectors• Non-discriminatory – provides a level playing field• Application based on arrival/ departure, not
airspace - which was considered ‘impracticable’in ICAO guidance on emissions trading
• Consistent with the 15 guiding principles for MBMs adopted at 2010 Assembly
• Legislation obliges the EU to continue to seek an agreement on global measures
Estimated costs per passenger
• CO2 emissions from ICAO carbon calculator – reflecting typical aircraft and load factors• Carbon price = €12• Assumes growth in aviation from baseline – typical long haul airlines receive around 80% of
their required allowances for free
Route CO2 emissions CostLow case
CostHigh case
Brussels to Montreal 379 kg €0.91 €4.55
Paris to Beijing 627 kg €1.50 €7.52
Amsterdam to Johannesburg
683 kg €1.64 €8.20
Frankfurt to Singapore 753 kg €1.81 €9.04
London to Rio de Janeiro
746 kg €1.79 €8.95