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Towards a European Green Deal: The evolution of EU climate and energy policy mixes

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Abstract

A growing scholarship argues that decarbonization cannot be achieved with single instruments like carbon pricing alone. A broader mix of reinforcing policies is required. This literature focuses on how policies can accelerate technological innovation, restrict polluting activities, promote green growth, and ensure social justice. Applying the policy mix literature to the European Union (EU), this article examines the development of climate and energy policies from separate and narrow initiatives to coordinated policy packages to achieve increasingly ambitious climate targets, culminating with the European Green Deal. The starting point to explain this policy development is that EU policies will reflect the positions of the ‘least ambitious’ actors when unanimity is required. Examination of different policy phases shows that EU policy mixes are not only needed to fulfil different transition functions—they also provide opportunities to combine different actor interests to raise climate ambitions. The EU institutions have been instrumental in crafting policy packages that exempt and compensate the least climate-ambitious actors. The Paris Agreement has also provided an enabling context for higher EU ambitions. Looking towards the future, the corona-induced recession has so far mainly been used by the EU as an opportunity to strengthen climate ambitions and the European Green Deal.

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Notes

  1. Including emissions and removal.

  2. Interviews are based on confidentiality and are used as background information for interpreting written sources.

  3. https://ec.europa.eu/eurostat/statistics-explained/index.php/Climate_change_-_driving_forces.

  4. Includes only territorial emissions – not consumption-based emissions embedded in international trade.

  5. EU-28 CO2 emissions per unit GDP (ton CO2/1000$) has decreased from 0.37 in 1990 to 0.18 in 2018. https://edgar.jrc.ec.europa.eu/overview.php?v=booklet2019&dst=GHGgdp.

  6. https://ec.europa.eu/eurostat/statistics-explained/index.php/Climate_change_-_driving_forces.

  7. Allocation procedures were altered and harmonized, from free allowances to a system based on payment-by-auctioning as the main principle.

  8. Other policies simultaneously developed by the Commission were adopted according to a different time schedule; these included emissions standards for new cars and the Energy Efficiency Directive, adopted in 2012.

  9. Nuclear energy in the EU is mainly governed by the Euratom Treaty. Construction of nuclear reactors is determined by the member-states.

  10. EU climate and energy targets and policies have generally been adopted by unanimity. Unanimity has alternately been legally required, politically determined or de facto under the ‘shadow of voting’ (Skjærseth et al. 2016).

  11. EU-27 (26% reduction for EU-28). Trends and projections in Europe 2020 — European Environment Agency (europa.eu).

  12. Directive (EU) 2018/410.

  13. The MSR was aimed at creating a better balance between allowance supply and demand, by adjusting the amount of allowances to be auctioned https://ec.europa.eu/clima/policies/ets/reform_en.

  14. https://sandbag.org.uk/carbon-price-viewer/

  15. In addition, 10% of the allowances for 2021–2030 will be allocated to a ‘solidarity fund’ for less wealthy EU member states. The remaining allowances to be auctioned will be distributed to the EU member states based on their verified emissions.

  16. https://ec.europa.eu/clima/policies/budget/modernisation-fund_en

  17. Regulation (EU) 2018/842.

  18. Maximum 105 million tonnes. https://ec.europa.eu/clima/policies/effort/regulation_en

  19. Concerning the land-use sector, member-states may use up to 262 million credits over the 2021–2030 period to comply with their national ESR targets.

  20. Regulation (EU) 2018/841.

  21. https://www.europarl.europa.eu/factsheets/en/sheet/69/energy-efficiency; https://www.europarl.europa.eu/factsheets/en/sheet/70/renewable-energy.

  22. This was underscored by most of the interviewees.

  23. Directive (EU) 2018/2001.

  24. https://www.theguardian.com/business/2018/jun/14/eu-raises-renewable-energy-targets-to-32-by-2030.

  25. Directive (EU) 2018/2002. Compared to projections of the expected energy use in 2030. https://ec.europa.eu/energy/en/topics/energy-efficiency/targets-directive-and-rules/energy-efficiency-directive.

  26. An updated Directive on energy performance in buildings was also adopted.

  27. Regulation (EU) 2018/1999.

  28. https://ec.europa.eu/energy/topics/energy-strategy/national-energy-climate-plans_en.

  29. This element consists of four legal acts: a new electricity regulation, and amended electricity directive, a regulation on the role for the Agency for the Cooperation of Energy Regulators (ACER) and risk preparedness.

  30. Regulation (EU) 2019/943.

  31. https://ec.europa.eu/commission/presscorner/detail/en/IP_18_6870; https://www.fni.no/getfile.php/1310034-1561035809/Filer/Publikasjoner/REMAP%20Insight%205%20-%202019.pdf.

  32. New plants built after the Regulation enters into force emitting more than 550gr CO2/kWh cannot be remunerated. After 2025, the same rules will apply also to existing plants. However, a ‘grandfathering’ clause was introduced: all contracts concluded before the end of 2019 may be exempted from the rules.

  33. https://setis.ec.europa.eu/actions-towards-implementing-integrated-set-plan/implementation-plans.

  34. https://ec.europa.eu/clima/policies/innovation-fund_en#:~:text=%20Innovation%20Fund%20grants%20can%20be%20combined%20with,Just%20Transition%20Fund%207%20Private%20capital%20More%20.

  35. https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52018DC0773&from=EN.

  36. https://ec.europa.eu/energy/sites/ener/files/hydrogen_strategy.pdf; https://eur-lex.europa.eu/legal-content/EN/TXT/?qid=1593086905382&uri=CELEX:52020DC0102; EU strategy on offshore renewable energy | Energy (europa.eu).

  37. https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52018DC0773&from=EN

  38. This non-legal initiative has been criticized for diffusing responsibility. See: https://www.greeneuropeanjournal.eu/who-is-in-charge-of-the-european-pillar-of-social-rights/.

  39. The reason is that regulated energy tariffs can distort market signals.

  40. Until the Just Transition Fund, the Cohesion Fund, European Regional Development Fund and Social Fund have been available to support projects linked to Coal Regions in Transition Platform.

Abbreviations

CCS:

Carbon Capture and Storage

EGD:

European Green Deal

ESR:

Effort Sharing Regulation

ETP:

European Technology Platform

EU:

European Union

EU ETS:

EU Emissions Trading System

GDP:

Gross Domestic Product

GHG:

Greenhouse Gas

JDT:

Joint Decision Trap

LULUCF:

Land use, land-use change and forestry

MSR:

Market Stability Reserve

MLG:

Multi-Level Governance

NECPs:

National Energy and Climate Plans

PA:

Paris Agreement

SET-Plan:

Strategic Energy Technology Plan

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Acknowledgements

The author wants to thank two reviewers, the special issue team, Joyeeta Gupta, Kacper Szulecki and Tor Håkon Inderberg for extremely helpful comments.

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  1. The Fridtjof Nansens Institute, Fridtjof Nansens vei 17, P.O.Box 326, 1326, Lysaker, Norway

    Jon Birger Skjærseth

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Appendix 1: Interviews 2019, Brussels

Appendix 1: Interviews 2019, Brussels

  • Balke, Joachim. Cañetes cabinet, 25.02.

  • Engquist, Rasa. Permanent Representation of Sweden to the EU. 25.02.

  • Will, Francis. Permanent Representation of the UK to the EU. 25.02.

  • Graziani, Francesco. European Commission. DG Energy. 26.02.

  • Hujber, Andreas. European Commission. DG Energy. 26.02.

  • Kiela-Vilumsone, Lelde. European Commission. DG Energy. 26.02.

  • Robert, Sylvain. European Commission. DG Energy. 26.02.

  • Rudnicka, Barbara. Permanent Representation of Poland to the EU. 27.02.

  • Rullaud, Louise. EURELECTRIC. 27.02.

  • Runnel, Reesi-Reena. Permanent Representation of Estonia to the EU. 26.02.

  • Salay, Jürgen. European Commission. DG Climate. 04.04.

  • Tonitz, Matthias. Permanent Representation of Austria to the EU. 25.02.

  • Zeitoun, Jérémie. European Parliament, the Greens. 26.02.

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Skjærseth, J.B. Towards a European Green Deal: The evolution of EU climate and energy policy mixes. Int Environ Agreements 21, 25–41 (2021). https://doi.org/10.1007/s10784-021-09529-4

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