The EU ETS carbon price reached a high of over €60 per tonne in September. Some are arguing that its role in the current gas price crisis is a reason why it should be reined in. But Milan Elkerbout at CEPS Policy Insights explains that the EUA (European Union Allowance) has multiple purposes. It is an incentive to invest in low-carbon solutions such as renewables, efficiencies and new methods. The sooner we pass the cost hurdle of integrating … [Read more...]
Renewable Hydrogen: what policy instruments are needed to reach the new targets?
A comprehensive mix of policy instruments is needed to ensure that the EU meets its ambitious hydrogen targets. What should they look like? Pia Kerres, Matthias Schimmel and Corinna Klessmann at Guidehouse quote their study, done in collaboration with Agora Energiewende, for the answers. Industry and long-haul transport should be the main customers for hydrogen. The big challenge is to cut the cost of hydrogen production; it’s too expensive and … [Read more...]
EU “Fit for 55”: how it impacts the EU ETS to accelerate emissions reductions
Christoph Kellermann, Lun Zhou and Simon Göss at Energy Brainpool explain how the EU’s new “Fit for 55” proposals, released in July, will impact the EU Emissions Trading Scheme (EU ETS), hailed as one of the most effective ways of reducing emissions. The authors cover the changes to the existing ETS, the planned new ETS for road transport and buildings, the controversial Carbon Border Adjustment Mechanism (CBAM), and the new CO2 standards for … [Read more...]
Comparing four Carbon Removal scenarios (IPCC, IEA, McKinsey, NGFS) and policy implications
Most net-zero scenarios include carbon removal as a major component. Simon Göss and Hendrik Schuldt at cr.hub review five major scenarios from the IPCC, IEA, ETC, McKinsey, and the Network for Greening the Financial System (NGFS). They start by making the very important distinction between carbon capture and negative emissions: capturing carbon from, say, a gas plant does not deliver negative emissions, it just prevents new emissions. This … [Read more...]
Wind, Solar: continuing cost declines will help meet rising renewables targets
The EC’s “Fit for 55” proposals include the raising of the EU’s 2030 target for total energy produced from renewable sources to 40%. Much of the rest of the world will likely raise its targets at some point too. Continuing to cut the cost of renewable energy generation will be essential to make that happen, and take pressure off all the other associated costs of supporting its integration into the energy system. Michael Taylor at IRENA summarises … [Read more...]
Central and Eastern Europe’s buildings renovation plans fall far short of 55% emissions cuts
There are big decarbonisation gains to be had in a renovation wave in Central and Eastern Europe (CEE) precisely because their building stock is very energy-inefficient, explains Christophe Jost at CEE Bankwatch. But Bankwatch's report on eight national plans - Bulgaria, Czechia, Estonia, Hungary, Latvia, Poland, Romania and Slovakia – reveals weaknesses in scale, funding, strategy and policy. Many are planning to comply with only the former 40% … [Read more...]
‘Fit for 55’ should prioritise decarbonisation of laggards: buildings, transport, industry, agriculture
Today’s long-awaited "Fit for 55" legislative package from the European Commission will trigger intense and difficult negotiations that will last two years, says Nicolas Berghmans at IDDRI. Its scope is wide and inevitably interconnected. The twelve legislative proposals include adjustments to existing measures (renewable energy, energy efficiency, carbon market/EU ETS, energy taxation, climate effort sharing between Member States/ESR, land use … [Read more...]
Hydrogen: can gas, electricity and industrial majors agree on the next steps?
Here’s our written summary of our panel debate held on 16th June “Hydrogen: Designing the Net Zero Gas System”. With representatives from BASF, SNAM and ELIA to cover consumption, gas and electricity, there were plenty of differences of opinion. For example, with no end in sight for demand for green electricity for the grid, is it efficient to use some of it for hydrogen? Will subsidies for hydrogen skew markets away from industrial … [Read more...]
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