Specifically, it concerns the so-called nationally determined contributions (NDC), with which the EU intends to enter the negotiations of the UN Climate Conference from November 10 to 21. According to the latest resolutions, greenhouse gas emissions in the EU are to decrease by 66.25–72.5 percent by the year 2035, as usual compared to 1990. By the year 2040, emissions are to decrease by 90 percent. Of these 90 percent, up to five percentage points can be offset by purchasing international climate credits. The original EU proposal envisaged a maximum of three percentage points for offsetting emissions through certificates from third countries. Additionally, the environment ministers have decided to postpone the start of emissions trading for transport and buildings by one year to 2028.
The EU environment ministers entered the negotiations with very different positions. The Federal Association of the Energy and Water Industry (BDEW) therefore praised the fact that there was a result at all. "This is an important signal to the economy, which needs planning security for further investments in climate-friendly technologies. For this, clarity and determination are now required in the instruments and measures necessary to achieve the targets. We view the postponement of the introduction of the European fuel emissions trading (ETS 2) critically. This market-based instrument would have set important price signals for the heating transition and the ramp-up of electromobility across Europe and is a central measure for achieving the climate target just decided," says Kerstin Andreae, Chair of the BDEW Executive Board.
Criticism of inconsistent promotion
The criticism from the E-Fuel-Alliance was more pronounced. "The dilution of the 2040 targets is unacceptable," said Ralf Diemer, Managing Director of the E-Fuel-Alliance. "Emissions trading has proven to be a reliable instrument for reducing emissions. ETS 2 is a central climate protection instrument. The building and transport sectors urgently need to make climate policy progress. If the planned introduction is delayed to 2027, a crucial lever for emission reduction will be lost."
Simultaneously with the new NDC, the EU published the Sustainable Transport Investment Plan, which the E-Fuel-Alliance welcomed. "However, the funds are at risk of dissipating if the overall framework conditions are inadequate," said Diemer.
"The restrictive production criteria for green hydrogen and e-fuels increase production costs by at least 35%. It is paradoxical that on the one hand additional funding is provided, but on the other hand, the use of electricity from subsidized wind and PV plants is not possible. It is necessary to revise the delegated acts.
The calculation: For 2% e-fuels in the European transport sector in 2030, almost 7 million liters of production capacity are needed, and for this, 32 billion euros of investment are necessary. The Commission is focusing too rigidly on aviation and shipping, according to the criticism from the E-Fuel-Alliance. These sectors do indeed need e-fuels quickly, but they have low willingness to pay and strong international competition. Therefore, demand from road transport must be more included.
