Climate and energy targets finally agreed, but what does it mean for transport?

Last week, the European Council composed of heads of states and governments reached an agreement on the EU’s climate and energy targets for post-2020. We ended up with three targets. 

The first is the only truly legally binding one – greenhouse gas reductions of at least 40% with binding national targets. It is to be split up between a 43% reduction for the ETS sectors and a 30% cut for non-ETS sectors – primarily transport, buildings and agriculture – compared with 2005. The latter figure translates into a 22% reduction by 2030 compared to today’s levels.

The second is a 27% target for renewable energy, which will be binding at EU level but not at national level – a concept that is still as mysterious as when it was first proposed in January. In 2012 renewables’ share was 14%.
The third is a non-binding 27% target for energy efficiency, which can be revised to 30% in 2020. But importantly, the baseline for that figure is what the EU expected in 2007 – before the crisis hit – to be using by 2030. It all boils down to energy use only 8% lower in 2030 than we had in 2013.
Unsurprisingly, scientists have expressed their concerns over the level of ambition, which is not going to keep us below the internationally-agreed 2°C target and will require Europe still to make massive cuts between 2030 and 2050 to keep us in line with the committed 80-95% by 2050.
But at least we have “at least”, which means that the 40% target can be revised upwards, if there is an international agreement in Paris. And at least we have a deal, which was by no means clear as Poland was again brandishing its threat to veto the whole deal. The deal is fraught with “flexibilities”, and includes significant money transfers to poorer and coal-dependent EU countries. But what does this deal mean for transport?
The language on transport is quite generic and it will depend critically on what kind of measures the Commission will propose to implement it. Transport is the largest source of CO2 emissions in Europe, with a share of 31% in 2012 and rising, and is responsible for about half of Europe’s €400 billion annual energy import bill. 
The Council said the following on transport:
2.13 it is important to reduce greenhouse gas emissions and risks related to fossil fuel dependency in the transport sector. The European Council therefore invites the Commission to further examine instruments and measures for a comprehensive and technology neutral approach for the promotion of emissions reduction and energy efficiency in transport, for electric transportation and for renewable energy sources in transport also after 2020. The European Council calls for a rapid adoption of the Directive laying down calculation methods and reporting requirements pursuant to Directive 98/70/EC of the European Parliament and of the Council relating to the quality of petrol and diesel fuels. It also recalls that under existing legislation a Member State can opt to include the transport sector within the framework of the ETS;
Let me make an effort to interpret this, as always, woolly and woody language.
On the positive side, it can be a boost for new stringent efficiency standards for vehicles, which have proven to be a very successful policy, saving lots of oil, GHG emissions and money and creating jobs in the process. In addition, it could focus the attention of the newly-elected Juncker Commission to come up with a strategy for the sustainable electrification of transport, which Europe badly needs, to support the efforts that this innovative industry is already undertaking and to provide a level-playing field with the current monopoly of the oil industry. Vice-President Sefcovic, over energy union, could provide steering and boost this strategy, as he has all the necessary commissioners in his cluster.
On the negative side, the idea that member states could put transport in the ETS is a very bad one, as analysis has shown. The Council refers to existing legislation, which means article 24 of the emissions trading directive. This article would have to be activated with the Delegated acts, but before anything like that is done, the Commission should analyse whether this would be legal and desirable in terms of achieving real and additional emissions reductions. Our legal analysis shows that including any sector in the ETS should lead to real emissions reductions – beyond business as usual. Studies conducted so far show that this would not be the case if we included transport.
We definitely need to keep a very close eye on the further promotion of renewable energy in transport. We all know that this can be either a good thing (for example, electricity from wind to power trains) or a bad thing (first-generation biodiesel). Last January the Commission admitted as much in a big U-turn, pledging that food-based biofuels would not receive public support any more after 2020. After almost 20 years of subsidies this is not a minute too early. Unsurprisingly countries like France and Spain, and, of course, the industry, are working hard to reverse this pledge; so it really is key that the new Juncker Commission keeps it. A much better way forward is an energy decarbonisation policy that also includes oil, which is becoming dirtier with tar sands and other unconventional sources knocking at the EU’s doors
Finally, the Council also included strange language on how they “will continue to give strategic orientations as appropriate, notably with respect to consensus on ETS, non-ETS, interconnections and energy efficiency“. This is potentially very significant because the European Council – heads of state, that is – almost always decides by consensus, while energy and climate ministers can do so by majority. Depending on how seriously this sentence will be taken in future, it will mean lowest-common-denominator decision-making by member states. While our fossil energy suppliers will love this self-imposed indecision, it is not what Europe, let alone the planet, needs now. It is now time for the Parliament to stay strong and ensure that the treaties and democracy are respected. Europeans deserve more than high-level behind-closed-doors discussions on the future of our planet and society.
Written by Nusa Urbancic for Transport Environment