EU energy pathways and 2030 emissions targets: No surprises
Is the European renewables industry facing unforeseen new obstacles? Newspapers have reported an EU “U-turn” away from renewables in favour of shale gas, while the UK has refused to back a 2030 Europe-wide renewables target. But experts suggest neither development is unexpected.
Shale gas: full steam ahead?
According to a Mail on Sunday article this weekend, the EU is pushing for member states to “restore Europe’s competitiveness” by extracting “cheap” shale gas instead of rolling out renewables, following a European Council summit on taxation and energy.
The article suggests this is a “policy shift” prompted by news that EU electricity prices have risen by 40 per cent since 2005. Quoting from a statement issued last week, it says:
“EU leaders issued a statement saying ‘the supply of affordable and sustainable energy to our economies is crucial’. They added that the EU would support ‘systematic recourse to on-shore and off-shore indigenous resources’ – a reference to shale.”
But policy analysts disagree the EU has changed tack on shale gas. Jonathan Gaventa from environmental thinktank, E3G, tells Carbon Brief:
“The general view was that the council’s statement is a restatement of existing positions. The EU has been concerned about reliance on gas imports for decades, and has already set in motion an assessment of Europe’s unconventional energy sources [including shale gas].”
The council’s statement says it is “crucial” to diversify Europe’s energy supply, promising a more systematic approach to assessing the region’s homegrown fossil fuel resources. Yet it also says:
“The deployment of renewable energy sources will continue, while ensuring their cost effectiveness further market integration and grid stability and building on the experience in some member states which have heavily invested in renewable energy technologies.”
Gaventa points out:
“The Mail article fails to mention that in calling for diversification, the renewables are first on the council’s list”.
Rachel Cary at the Green Alliance says that while the EU is keen to assess the potential of fuels such as shale gas to reduce reliance on imports, previous reports have not suggested large amounts are recoverable in Europe:
“A [European] Commission report looking at the market impacts of unconventional gas last year, stated that at best shale gas could only help make up for declining conventional production across Europe – this is far from the shale gas revolution painted by many as a credible alternative to renewables and energy efficiency.”
What’s more, it is important to see the EU’s statement in the context of its wider energy strategy says. Europe’s 2050 Energy Roadmap envisions an interim role for gas as a backup or bridging fuel for renewables in some scenarios – including with carbon capture and storage – as part of the EU’s target of reducing emissions by up to 90 per cent by 2050.
But the new statement may affect how Europe deploys its indigenous gas because it calls for the “phasing out of environmentally or economically harmful subsidies, including for fossil fuels”. If it’s not possible to deploy shale gas without subsidies, countries may have a fight on their hands to have support for the fuel approved at an EU level. At present, UK government documents reveal EU regulations on the level of support governments will be able to give shale gas aren’t yet clear.
Then there’s the possibility that populations may just reject the technology. As Ireland’s energy minister, Pat Rabbitte, tells the FT, it’s still “too early to say where [the shale debate] will settle”.
UK renewables targets
The UK’s negotiations in Europe over future climate targets for the region have also made the news. The Independent reports that the UK is pushing for an “ambitious” target of cutting carbon emissions by 50 per cent by 2030.
It’s not all good news for some, however. The Guardian reports that environmentalists are angry that the government is resisting introducing targets for the amount of renewable energy that should be deployed by 2030. The current EU targets for renewables deployment run out in 2020.
Quoted in the FT, energy secretary, Ed Davey, called renewables targets “inflexible and unnecessary”. He adds:
“Whilst we strongly support renewables to 2020 and beyond, the uncertainties at this time are too large to set hard numbers in a binding EU renewables target, which we do not believe would be cost effective or fit well with our electricity market reforms.”
Unlike some commentators, the Confederation of British Industry has welcomed the government’s stance, saying it will provide certainty for investors in low carbon technology:
“A clear UK position on a single 2030 emissions reduction target will help reassure investors that the Government understands their need for certainty and flexibility if they are to invest in low-carbon technologies with confidence.”
The Guardian reports that the Treasury only allowed Liberal Democrats to push for strong emissions cuts at EU level because they gave up on the renewables target. But while the UK’s position on targets may indeed be the result of a compromise between the Department of Energy and Climate Change and the Treasury – and some hope there’s still scope for a change in direction – it is possible that the government never intended for there to be a renewables target.
If the EU decides on emissions cuts without setting targets for renewable technologies, gas and nuclear power are more likely to be allowed a place at the table in member states’ energy portfolios. There have been indications for some time that this is the way the government has been leaning. This time last year, the Guardian reported the UK government “wants nuclear power to be given parity with renewables in Europe”, according to a leaked report. The document said the government “cannot support a 2030 renewables target” because it wanted to see a level playing field for all low carbon technologies.
Gaventa says:
“The UK government has restated its opposition to renewables targets – which some had hoped it would reassess given that there is support for such measures from countries like France and Germany. Its position is surprising in some ways, given that the UK’s new electricity market arrangements such as Contracts for Difference will still have the effect of deciding how much of different low carbon technologies the government wants.”
Whether the UK’s stance on emissions cuts or the commission’s statements on shale gas lead to changes long term in Europe’s energy mix remain to be seen. But, it turns out, neither statement was particularly unexpected.