Agreement on the review of "Fit for 55": new targets for 2030 on energy from renewable sources and reduction of carbon emissions

The European Commission announced yesterday the adoption of the revised Renewable Energy Directive and the ReFuel EU Aviation Regulation - the two final pillars of the "Fit for 55" legislative package, the implementation of which will ensure the achievement of the EU's climate objectives for the year 2030.

According to a press release posted on the Brussels institution's website, Ursula von der Leyen, President of the European Commission, said: "The European Green Deal brings the change we need to reduce CO2 emissions. It does this by taking into account the interests of our citizens and providing opportunities for our European industry. Legislation to reduce our greenhouse gas emissions by at least 55% by 2030 is now in place and I am very happy that we are well on our way to exceeding our original targets. This is an important sign for Europe and our global partners that the ecological transition is possible, that Europe is fulfilling its promises".

With the adoption of the revised Renewable Energy Directive and the EU ReFuel Aviation Regulation, the EU bloc now has binding climate targets covering all key sectors of the economy.

European Commission officials estimate that the implementation of the new legislative package will reduce the EU's net greenhouse gas emissions by 57% by 2030. With this reform, member states will spend 100% of their revenues from the trading of emission certificates on related projects of climate and energy and the social dimension of the transition. The newly created Social Climate Fund will allocate euro65 billion from the EU budget and more than euro86 billion in total to support the most vulnerable citizens and SMEs in the green transition.

The agreement adopted yesterday, following the trialogue - the European Commission, the European Parliament and the Council of the EU -, regarding the revised Directive on energy from renewable sources (RED) establishes that, in 2030, 42.5% of energy will be from renewable sources. The new target will almost double the existing share of renewable energy in the EU. The agreement also stipulates that 45% of the energy mix will come from renewable sources by the year 2030. The consolidated directive supports the adoption of renewable sources in different sectors of the economy with a set of dedicated objectives and measures. Industry, which is a key energy-intensive sector of the economy, is covered by the Renewable Energy Directive for the first time. The new measures include an indicative annual increase in the use of renewable energy in industry of at least 1.6 percentage points by 2030, as well as a new mandatory target of 42% of renewable hydrogen in total industrial hydrogen consumption by 2030. In for transport, the aim is either to reduce the greenhouse gas intensity of transport fuels by 14.5% or to achieve a global 29% share of renewable energy in final energy consumption in all transport sectors . This is an increase from the previous binding target of 14%. There is also a combined sub-target of 5.5% advanced biofuels and renewable fuels of non-biological origin (RFNBO), with a minimum level of 1% renewable fuels of non-biological origin, as well as an indicative target of 1.2% from renewable sources in the marine transport fuels sector.

On the Energy Efficiency Directive, negotiators agreed on a new EU-wide target to improve energy efficiency by 11.7% by 2030. Member States will have to make annual savings of 1.49% on average from 2024 by 2030. The public sector will lead, with an annual savings target of 1.9%. In addition, to complement EU building legislation and guide Member States' efforts, there is a new indicative national benchmark of 49% renewable energy in the buildings sector. The agreement also includes the first EU definition of energy poverty. Member States will now have to implement energy efficiency improvements as a priority among people affected by energy poverty.

The revision of the EU Emissions Trading Scheme (EU ETS) Directive stipulates that emissions must fall by 62% by 2030 compared to 2005, which is a substantial increase in the cap compared to the previous target of reducing emissions by 43%. The rate of annual emissions reductions will increase from 2.2% per year under the current system to 4.3% from 2024 to 2027 and 4.4% from 2028. The manufacturing industry will continue to benefit from a cap of free allowances to approach the "relocation of carbon emissions" tool. The new Carbon Border Adjustment Mechanism (CBAM) will ensure that imported products will pay a carbon price at the border in covered sectors. This is a valuable tool for promoting global emission reductions and leveraging the EU market to pursue our global climate goals. Combined with the EU's emissions trading system, this reduces the risk of "carbon relocation", whereby companies move their production from Europe to countries with less stringent environmental standards.

The revised EU ETS will include emissions from maritime transport from 1 January 2024, covering around two-thirds of emissions from the sector (90 million tonnes of CO2) and complementing the new FuelEU Maritime and Alternative Fuels Infrastructure regulations to help reduce faster of emissions in the sector through the adoption of renewable and low-carbon fuels and infrastructure. For aviation the revised EU ETS rules applying to the sector will speed up the implementation of the polluter pays principle by phasing out free allowances by 2026, which currently cover 85% of aviation emissions.

The revised regulation on CO2 standards will ensure that all new cars and vans registered in Europe will have zero emissions from 2035. As an intermediate step towards zero emissions, the average emissions of new cars will have to fall by 55% by 2030, and new vehicles by 50% by 2030. The new Alternative Fuels Infrastructure Deployment Regulation (AFIR) sets mandatory deployment targets for electric recharging and hydrogen infrastructure along European roads. In this way, publicly accessible recharging infrastructure for cars and vans is growing at the same rate as the electric vehicle fleet.

ReFuelEU Aviation sets EU-wide harmonized rules to promote sustainable aviation fuels (SAF), increasing the minimum share of SAF blended with kerosene by aviation fuel suppliers and supplied to EU airports. The FuelEU Maritime Regulation will promote the adoption of renewable and low-carbon fuels by setting a target to gradually reduce the average annual GHG intensity of energy used on board ships.

The implementation of the "Fit for 55" legislation will take place within the National Energy and Climate Plans (PNEC), documents currently being finalized by the Member States, which will have to integrate the new European legislation adopted yesterday and demonstrate how they will climate and energy targets for 2030 be met at national level. Most Member States will have increased national targets under the revised regulation (Malta is the only exception). The targets now vary between -10% emissions (Bulgaria) or -12.7% emissions (Romania) and -50% emissions (Denmark, Germany, Luxembourg, Finland and Sweden).