The Energy-Climate Package

The pieces of information presented here are mostly taken from the "Memo on the Renewable Energy and Climate Change Package" [1]. All the information on the "Climate Action" program can be found on the European Commission website.

In recent decades, our lifestyle and growing wealth has had a profound effect on the energy sector, changing the energy outlook considerably in the process. Increasing demand for energy, soaring oil prices, uncertain energy supplies and fears of global warming have opened our eyes to the fact that energy can no longer be taken for granted. EU leaders have thus made a commitment to increase the use of renewable energy; energy that can replace fossil fuels, diversify our energy supply and reduce our carbon emissions. A comprehensive legislative framework is necessary for the promotion and the use of renewable energy. Only this can provide the business community with the long-term stability it needs to make rational investment decisions in the renewable energy sector and put the European Union on track towards a cleaner, more secure and more competitive energy future.

In January 2007 the European Commission put forward an integrated energy/climate change proposal that addressed the issues of energy supply and climate change. Two months later, European Heads of State endorsed the plan and agreed to an Energy Policy for Europe.

These targets are indeed very ambitious: the share of renewable energy in 2007 was only 8.5%. To achieve a 20% share by 2020 will require major efforts across all sectors of the economy and by all Member States. A European approach is needed to ensure that the effort for reaching the 20% target is shared equitably between Member States.

On 23 January 2008, the European Commission put forth an integrated proposal for Climate Action, referred to as the "Energy-Climate Legislative Package".

After nearly a year of intensive negotiations, the Energy-Climate Legislative Package was finally adopted by the 27 EU Member States on 12 December 2008, by the European Parliament on 17 December 2008 [2], and finally by the Council of the European Union on 6 April 2009 [3]. The topics addressed and the corresponding legislative acts (23 April 2009) are briefly described below.

The legislative acts more specifically concerned with biofuels are the two Directives 2009/28/EC and 2009/30/EC, which are briefly described below.

In order to achieve the renewable energy targets, the European Commission has adopted the European Directive 2009/28/EC [4]. This aims to establish national renewable energy targets that result in an overall binding target of a 20% share of renewable energy sources in energy consumption in 2020 and a binding 10% minimum target for renewable fuels in transport to be achieved by each Member State.

Three sectors are implicated by renewable energy: electricity, heating and cooling and transport. It is up to the Member States to decide on the mix of contributions from these sectors to reach their national targets, by selecting the means that best suits their national circumstances. They will also be given the option of achieving their targets by supporting the development of renewable energy in other Member States and third countries.

Finally, the Directive also aims to remove unnecessary barriers to the growth of renewable energy - for example by simplifying the administrative procedures for new renewable energy developments – and encourages the development of better types of renewable energy (by setting sustainability standards for biofuels etc).

The European Commission has adopted the European Directive 2009/28/EC [4] in order to improve air quality and reduce greenhouse gas emissions through environmental standards for fuel. The Directive will also facilitate the more widespread blending of biofuels into petrol and diesel and set ambitious sustainability criteria for biofuels in order to avoid negative consequences.

The revised directive introduces for the first time a reduction target for greenhouse gas (GHG) emissions from fuels. By 2020, fuel suppliers have to decrease by 6% climate-harming emissions over the entire life-cycle of their products. This can be reached in particular by admixing biofuels to petrol and diesel as well as by improving production technology in refineries. Member states may require an additional 4% reduction from fuel companies, achieved through the supply of energy for electric vehicles or other clean technologies, including carbon credits from third countries (so-called "Clean Development Mechanism").

To enable these GHG emissions cuts, petrol may have a higher biofuel content. From 2011, petrol may contain up to 10% (vol.) ethanol. In order to avoid damage to old cars, however, fuel with 5% (vol.) ethanol will continue to be available until 2013, with the possibility for member states to extend that period.

The directive also incorporates the same environmental and social sustainability criteria for biofuels as in Directive 2009/28/EC. It imposes limits on the content of sulphur and metallic additives in engine fuel. Finally, the maximum vapour pressure of fuel is also prescribed in order to minimise emissions of volatile air pollutants.

The revised environmental quality standards as well as the sustainability criteria for biofuels will apply from 2011. Member states are required to transpose the directive into national law by the end of 2010.