Assessing the EU’s 2030 Climate and Energy Policy Framework: Incremental change toward radical transformation?

Abstract

This article provides a comprehensive overview of the changes to European Union (EU) climate and energy law brought about by the 2030 Climate and Energy Policy Framework. It explains the Framework’s background and objectives, and analyses its main legal instruments. It argues that the 2030 Framework incrementally develops and enhances EU climate law without revolutionizing it, advancing in particular its proceduralization. The article also explores the prospects for future change of the 2030 Framework towards more radical transformation in light of the European Green Deal and the ongoing COVID-19 pandemic.

1 INTRODUCTION

This article provides a comprehensive overview of changes to European Union (EU) climate and energy law to implement the EU’s 2030 mitigation target under the Paris Agreement through the 2030 Climate and Energy Policy Framework (2030 Framework).11 Paris Agreement (adopted 12 December 2015, entered into force 4 November 2016) 55 ILM 740 art 4(1)–(2). We analyse the key elements of the 2030 Framework and compare it with the legal framework implementing the EU’s 2020 climate and energy targets (2020 Package). Our overall assessment is that the 2030 Framework develops and enhances EU climate and energy law without revolutionizing it. It puts the EU on a path towards an incremental transition to a low-carbon society rather than responding to calls in climate science for a radical transformation.22 Intergovernmental Panel on Climate Change (IPCC), Global Warming of 1.5°C (IPCC 2018).

We also reflect on the future of the 2030 Framework. The ambition of the 2030 Framework is not in line with the goals of the Paris Agreement, which include limiting the global average temperature increase to well below 2°C and pursuing efforts to limit it to 1.5°C.33 Paris Agreement (n 1) art 2(1). The ambition is also not in line with the EU’s goal of becoming climate neutral – that is, achieving a balance between greenhouse gas emissions and their removals – by 2050.44 Commission (EU) ‘Proposal for a Regulation of the European Parliament and of the Council establishing a framework for achieving carbon neutrality and amending Regulation (EU) 2018/1999 (European Climate Law)’ COM(2020) 80 final, 4 March 2020 (European Climate Law Proposal). In light of these climate policy objectives, there is a clear need to further strengthen EU climate and energy law before 2030.

This work has already begun less than two years after the finalization of the 2030 Framework. The Commission published the European Green Deal (EGD) Communication in December 2019, aiming to put the European economy onto a more sustainable path and achieving climate neutrality by 2050.55 Commission (EU) ‘The European Green Deal’ (Communication) COM(2019) 640 final, 11 December 2019 (EGD) Annex II. Accordingly, the Commission has already proposed a European Climate Law to implement the 2050 climate neutrality target.66 European Climate Law Proposal (n 4). The latter was approved by the European Council in December 2019.77 European Council, ‘Conclusions’, EUCO 29/19 (12 December 2019) para 1. The European Council also acknowledged that one Member State (Poland) could not ‘commit to implement this objective as far as it is concerned’ (ibid). The Commission should also publish a plan in 2020 to increase the 2030 climate target to 50–55 percent, and a proposal in June 2021 to revise the relevant legislative measures to deliver on the increased ambition.88 EGD (n 5) Annex II. We will therefore also briefly discuss how the EGD might affect the 2030 Framework – and how the ongoing COVID-19 pandemic might affect this work.

This article is structured as follows. Section 2 discusses the background, objectives and legal structure of the 2030 Framework. Section 3 includes a detailed analysis of the key legal instruments in the 2030 Framework, comparing them with the 2020 Package and discussing their future in light of the EGD. Section 4 presents our overall assessment and conclusions.

2 OVERVIEW OF THE 2030 FRAMEWORK AND ITS CONTEXT

2.1 Background and objectives of the 2030 Framework

One of the main objectives of the 2030 Framework is to implement the EU’s emissions reduction contribution under the Paris Agreement. The Agreement relies on nationally determined contributions (NDCs), that is, climate change mitigation plans that the parties define nationally.99 Paris Agreement (n 1) art 4. The EU submitted its intended NDC in 2015, pledging ‘an at least 40% domestic reduction in greenhouse gas emissions by 2030 compared to 1990’, to be achieved without the use of international carbon credits but including land use, land-use change and forestry (LULUCF).1010 ‘Submission by Latvia and the European Commission on behalf of the European Union and its Member States, Intended Nationally Determined Contribution by the European Union and its Member States’ (6 March 2015) <https://www4.unfccc.int/sites/ndcstaging/PublishedDocuments/European%20Union%20First/LV-03-06-EU%20INDC.pdf>.

While some industries lobbied for only a climate target,1111 EurActiv, ‘Energy Utilities Push Carbon Pricing, Lobby against Renewable Targets at COP21’ (EurActiv, 9 December 2015). the 2030 Framework maintains the target structure of the EU’s 2020 Package, which aims to cut greenhouse gas emissions by 20 percent, increase the share of renewable energy in the EU’s final energy consumption to 20 percent and improve energy efficiency by 20 percent. Along the same lines, the 2030 Framework includes an at least 32 percent target for renewable energy and a target to enhance energy efficiency by at least 32.5 percent.

In addition to implementing the Paris Agreement, the 2030 Framework is part of the Energy Union.1212 Commission (EU) ‘Framework Strategy for a Resilient Energy Union with a Forward-Looking Climate Policy’ (Communication) COM(2015) 80 final, 25 February 2015, 4–6. See K Szulecki et al, ‘Shaping the Energy Union: Between National Positions and Governance Innovation in EU Energy and Climate Policy’ (2016) 16 Climate Policy 552. The European Council agreed on the five dimensions of the Energy Union in March 2015, namely: (i) energy security; (ii) internal energy market; (iii) energy efficiency; (iv) decarbonization; and (v) research, innovation and competitiveness.1313 European Council, ‘Conclusions’, EUCO 11/15 (20 March 2015) para 1. While their political motivations differ, the 2030 Framework and the Energy Union are legally entwined.1414 Commission (EU) ‘Clean Energy for All Europeans’ (Communication) COM(2016) 860 final, 30 November 2016.

2.2 Legal basis and structure of the 2030 Framework

As illustrated in Table 1, the 2030 Framework is based on two provisions of the Treaty on the Functioning of the European Union (TFEU).1515 Consolidated Version of the Treaty on the Functioning of the European Union [2016] OJ C202/47 (TFEU). Article 192(1) of the TFEU has been used as the basis for legislation in the 2030 Framework with climate change mitigation as part of environmental protection as its primary objective. Those elements of the Framework that focus on energy have been enacted under the TFEU’s title on EU energy policy, using Article 194(2) as the legal basis. In both cases, the ordinary legislative procedure has been used, meaning that the Council of Ministers and the European Parliament interacted to amend and adopt the various legislative instruments in 2017–2019.

The 2030 Framework builds on and complements the legal structures implementing the EU’s 2020 targets.1616 On the 2020 Package, S Oberthür and M Pallemaerts (eds), The New Climate Policies of the European Union: Internal Legislation and Climate Diplomacy (VUB Press 2010); and K Kulovesi, E Morgera and M Muñoz, ‘Environmental Integration and Multifaceted International Dimensions of EU Law: Unpacking the EU’s 2009 Climate and Energy Package’ (2011) 48 Common Market Law Review 829. It revises the Emissions Trading System (ETS)1717 Directive (EU) 2018/410 amending Directive 2003/87/EC on the EU emissions trading system [2018] OJ L76/3 (ETS Amending Directive). and Energy Efficiency Directives,1818 Directive (EU) 2018/2002 of the European Parliament and of the Council of 11 December 2018 amending Directive 2012/27/EU on energy efficiency [2018] OJ L328/210 (Energy Efficiency Directive). recasts the Renewable Energy Directive (RED II)1919 Directive (EU) 2018/2001 on the promotion of the use of energy from renewable sources [2018] OJ L328/82 (RED II). and upgrades the previous Effort Sharing Decision to an Effort Sharing Regulation (ESR) to define 2030 emission reduction targets for each Member State in economic sectors outside the ETS.2020 Regulation (EU) 2018/842 on binding annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate action to meet commitments under the Paris Agreement and amending Regulation (EU) No 525/2013 [2018] OJ L156/26 (ESR). It also adds two new instruments. First, the Regulation on the Governance of the Energy Union and Climate Action (Governance Regulation) creates integrated structures for planning, reporting and review of climate and energy policy.2121 Regulation (EU) 2018/1999 of the European Parliament and of the Council of 11 December 2018 on the Governance of the Energy Union and Climate Action [2018] OJ L328/1 (Governance Regulation). Second, the LULUCF Regulation2222 Regulation (EU) 2018/841 of the European Parliament and of the Council of 30 May 2018 on the inclusion of greenhouse gas emissions and removals from land use, land-use change and forestry in the 2030 climate and energy framework [2018] OJ L156/1 (LULUCF Regulation). sets a target for the LULUCF sector not to cause any net greenhouse gas emissions and strengthens rules for the accounting of LULUCF emissions and removals.2323 A Savaresi and L Perugini, ‘The Land Sector in the 2030 EU Climate Change Policy Framework: A Look at the Future’ (2019) 16 Journal for European Environmental and Planning Law 148; A Savaresi, L Perugini and MV Chiriacò, ‘Making Sense of the LULUCF Regulation: Much Ado about Nothing?’ (2020) 29 Review of European, Comparative and International Environmental Law 212. In addition, several energy-related legislative acts, including the Directive on Energy Performance of Buildings,2424 Directive (EU) 2018/844 of the European Parliament and of the Council of 30 May 2018 amending Directive 2010/31/EU on the energy performance of buildings and Directive 2012/27/EU on energy efficiency [2018] OJ L156/75 (EPBD). the Electricity Market Regulation2525 Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June 2019 on the internal market for electricity (recast) [2019] OJ L158/54 (Electricity Market Regulation). and Directive,2626 Directive (EU) 2019/944 of the European Parliament and of the Council of 5 June 2019 on common rules for the internal market for electricity and amending Directive 2012/27/EU (recast) [2019] OJ L158/125. the Regulation on Risk Preparedness2727 Regulation (EU) 2019/941 of the European Parliament and of the Council of 5 June 2019 on risk-preparedness in the electricity sector and repealing Directive 2005/89/EC [2019] OJ L158/1. and the Regulation on the Agency for the Cooperation of Energy Regulators,2828 Regulation (EU) 2019/942 of the European Parliament and of the Council of 5 June 2019 establishing a European Union Agency for the Cooperation of Energy Regulators (recast) [2019] OJ L158/22. form part of the 2030 Framework, mainly further developing existing instruments. We limit our discussion to instruments and substance directly relevant for the climate context and implementation of the EU’s NDC under the Paris Agreement.

TABLE 1. Legal structure of the 2030 Framework

Umbrella (Articles 192(1) and 194(2) TFEU) Regulation on the Governance of the Energy Union and Climate Action (2018/1999)

Climate Component (Article 192(1) TFEU) Revised Emissions Trading Directive (2018/410) Regulation 2018/842 on Effort Sharing Regulation on Land Use, Land-Use Change and Forestry (2018/841)

Energy Component (Article 194(2) TFEU) Recast Renewable Energy Directive (2018/2001) Revised Energy Efficiency Directive (2018/2002) Revised Energy Performance of Buildings Directive (2018/844) Recast Electricity Market Regulation (2019/943) Recast Electricity Market Directive (2019/944) Regulation on Risk Preparedness (2019/941) Recast Regulation on the Agency for the Cooperation of Energy Regulators (2019/942)

3 MAIN LEGAL INSTRUMENTS IN THE 2030 FRAMEWORK

This section provides an overview of the main legal instruments of the 2030 Framework. It compares them with the pre-existing legislation of the 2020 Package and highlights key changes. It also includes a brief assessment of each instrument.

3.1 Overarching structure: The Governance Regulation

The Governance Regulation is the ‘major novelty element’ in the 2030 Framework.2929 M Vandendriessche et al, ‘The Governance of the EU’s Energy Union: Bridging the Gap?’ (Florence School of Regulation 2017). Aligned with the Paris Agreement, it covers three key areas: planning, reporting and monitoring. Based on a review of 50 individual planning, monitoring and reporting obligations, it has integrated 31 of them under a single framework.3030 Commission (EU) ‘Proposal for a Regulation on the Governance of the Energy Union’ COM(2016) 759 final, 23 February 2017, 2. It has also introduced new requirements, most notably with respect to planning.

3.1.1 Planning

The Governance Regulation requires Member States to prepare two plans, national energy and climate plans (NECPs) and long-term strategies (LTSs). The Commission must prepare an LTS for the EU as a whole.

NECPs are a core element of the 2030 Framework.3131 M Duwe et al, ‘Governance of the Energy Union: Assessment of the Commission Proposal for a Governance Regulation’ (Ecologic Institute 2017). In the NECP, each Member State defines its national contribution to the five Energy Union objectives (see Section 2.2.1), including the EU-level renewable energy3232 Governance Regulation (n 21) arts 2(c), 4(a)(2) and 5. and energy efficiency targets.3333 ibid arts 4(b) and 6. Member States are also required to specify their plans to reach these targets along with their national greenhouse gas emission reduction targets in sectors outside the ETS.3434 ibid arts 3–6. NECPs are prepared every 10 years and updated at five-year intervals.3535 Draft updates of the first NECPs are due in 2023, and the next full draft NECPs by 1 January 2018; ibid arts 9(1) and 14(2).

FIGURE 1

Timeline for NECPs [Colour figure can be viewed at wileyonlinelibrary.com]

NECPs are prepared and updated through an iterative process in which the Commission plays an important role (Figure 1). Member States were required to submit their first draft NECPs at the end of 2018. The Commission assessed the drafts and provided recommendations within six months (see Section 3.1.3).3636 Commission (EU) ‘United in Delivering the Energy Union and Climate Action – Setting the Foundations for a Successful Clean Energy Transition’ (Communication) COM(2019) 285 final, 18 June 2019. The final NECPs were due at the end of 2019. After this, the Commission is required to assess whether the final NECPs are sufficient to meet the Energy Union objectives and the EU’s 2030 targets3737 Governance Regulation (n 21) art 13(a). and whether the Member States have taken due account of the Commission’s recommendations.3838 ibid art 13(b).

The Governance Regulation also translates an invitation in the Paris Agreement to prepare long-term climate strategies by 20203939 Paris Agreement (n 1) art 4(19). into a binding obligation under EU law for the Member States and the Commission to prepare LTSs.4040 Governance Regulation (n 21) art 15. These must have a time horizon of at least 30 years covering, among other things, greenhouse gas emissions and removals by sinks; emissions and removals in individual sectors; as well as expected progress towards the low-carbon economy.4141 ibid art 15(4) and Annex IV. The Commission is required to assess Member States’ LTSs.4242 ibid art 15(9).

Member States’ first LTSs were due by January 2020, the subsequent ones are due by January 2029 and every 10 years thereafter.4343 ibid art 15(1). The strategies should be updated every five years ‘where necessary’.4444 ibid. Concerning the EU’s collective LTS, the Commission proposed in November 2018 that the EU be climate neutral by 2050, outlining scenarios and emission pathways to reach this goal.4545 Commission (EU) ‘A Clean Planet for All’ (Communication) COM(2018) 773 final, 28 November 2018. The European Council approved the 2050 climate neutrality target in December 20194646 European Council (n 7). and the EU submitted the relevant conclusions as its LTS under the Paris Agreement in March 2020.4747 Croatia and the European Commission on behalf of the European Union and its Member States, ‘Long-Term Low Greenhouse Gas Emissions Development Strategy of the European Union and its Member States’ (6 March 2020) <https://unfccc.int/sites/default/files/resource/HR-03-06-2020%20EU%20Submission%20on%20Long%20term%20strategy.pdf>.

3.1.2 Reporting

The Governance Regulation also serves to comply with reporting obligations under the Paris Agreement4848 Paris Agreement (n 1) art 13. and to track the implementation of the EU’s energy efficiency, renewable energy and other Energy Union targets.4949 Governance Regulation (n 21) arts 20–25.

Starting from 2023 and every two years thereafter, Member States must prepare integrated national energy and climate progress reports (biennial progress reports).5050 ibid art 17(1). These cover all five dimensions of the Energy Union and describe progress in NECP implementation.5151 ibid art 17(2). In addition, each Member State must submit annual greenhouse gas inventory reports to the Commission and the UNFCCC Secretariat.5252 ibid art 26. The Governance Regulation includes various provisions on national and Union-level data collection5353 ibid art 37. and reporting systems,5454 ibid art 39. as well as registries to account for the NDC and international carbon credits.5555 ibid art 40.

3.1.3 Monitoring

The Governance Regulation creates a monitoring system to track the implementation of the 2030 Framework and the associated targets at the EU and Member State levels. The system relies on ex ante and ex post monitoring by the Commission.

The Governance Regulation has strengthened the Commission’s role especially concerning ex ante monitoring.5656 ibid art 29. In case draft NECPs or their draft updates show insufficient ambition, the Commission must recommend that the relevant Member States increase their ambition where the renewable energy target is concerned, while it ‘may’ issue such recommendations with respect to the other Energy Union objectives.5757 ibid art 31(1). The Commission’s assessment of the first draft NECPs found the collective ambition inadequate for all three 2030 targets.5858 Commission (EU) ‘United in Delivering the Energy Union and Climate Action – Setting the Foundations for a Successful Clean Energy Transition’ (Staff Working Document) SWD(2019) 212 final, 18 June 2019, 3–7.

The renewable energy target is particularly interesting given that its legal nature changed in the 2030 Framework to an EU-level target (see Section 3.3.1). The Governance Regulation obliges the Member States to ‘collectively ensure’ that the sum of their national contributions amounts to at least a 32 percent share for renewable energy at the EU level by 2030.5959 Governance Regulation (n 21) art 5(2). See further A Monti and B Martinez Romera, ‘Fifty Shades of Binding: Appraising the Enforcement Toolkit for the EU’s 2030 Renewable Energy Targets’ (2020) 29 Review of European, Comparative and International Environmental Law 221. While the 2030 Framework abandoned national renewable energy targets, Annex II of the Regulation includes a formula based on which national shares of the collective target can be calculated. Applying this formula in its assessment of the draft NECPs, the Commission found that 17 Member States had submitted targets below their calculated share, resulting in a potential EU-level gap of 1.6 percentage points by 2030. The Commission therefore stressed ‘the need for all Member States to increase their ambition in line with the shares resulting from the formula’.6060 Commission (EU) (n 36) 3 and 6–7. Concerning the energy efficiency target, only few Member States had proposed adequate national contributions with the draft NECPs revealing a potential shortfall of 6.2 percentage points.6161 ibid.

In case the final NECPs (and in future, their final updates) continue to show insufficient ambition, the Commission must propose measures and exercise its powers at the EU level to ensure the achievement of collective targets.6262 Governance Regulation (n 21) art 31(3). At the time of writing, most Member States had submitted their final NECPs and the Commission assessment was pending. According to initial information, overall ambition for renewable energy has increased to 33 percent, that is, above the target.6363 ‘EU Set to Slightly Surpass 2030 Renewable Energy Goal’ (EurActiv, 16 June 2020).

Starting in October 2021, the Governance Regulation requires the Commission to biennially assess progress towards the Energy Union objectives and 2030 targets both at the EU level and with respect to each Member State.6464 Governance Regulation (n 21) art 29. Ex post monitoring is based, in particular, on biennial progress reports by the Member States (see Section 3.1.2), other information reported under the Governance Regulation, as well as indicators and European statistics, where available.6565 ibid. In addition to biennially assessing progress, the Commission must prepare an annual State of the Energy Union Report, the contents of which will vary: while some information must be included in each report, other aspects only need to be reported at regular intervals, such as biennially or every four years.6666 ibid arts 29(1) and 35. The Status of the Energy Union Report will provide an opportunity for the European Parliament, the Member States and the general public to obtain information on progress at the EU level.6767 Vandendriessche et al (n 29) 12.

If reporting by a Member State points towards insufficient progress on NECP implementation, the Commission must issue recommendations to the Member State in question.6868 Governance Regulation (n 21) art 32(1). If the Commission identifies a risk that the EU collectively will not meet the 2030 targets, it may issue recommendations to all Member States and shall, where renewable energy and energy efficiency targets are concerned, propose new measures and exercise its power at the EU level to ensure the achievement of the respective target.6969 ibid art 32(2).

The Commission’s recommendations to Member States constitute the key response both during the planning and implementation phases of the NECP process. As seen above, the Commission has already made several recommendations to the Member States to strengthen their first NECPs. While the recommendations are not binding, the Governance Regulation requires Member States to take ‘due account’ of them,7070 ibid art 34(2)(a). explaining in their next biennial progress reports (see Section 3.1.2) how this has been done.7171 ibid art 34(2)(b).

The Governance Regulation also includes an obligation for the Commission to propose additional measures at the EU level to address insufficient ambition or implementation. For the most part, such new measures have not been specified in the Governance Regulation although some more specific language on gap-closing measures for the renewable energy and energy efficiency targets has been included.7272 ibid art 32(2).

3.1.4 Public participation

The Governance Regulation requires that Member States establish a multilevel climate and energy dialogue involving various stakeholders and the general public to discuss different scenarios for climate and energy policies.7373 ibid art 11. NECPs may also be considered during the dialogue.7474 ibid. The draft NECPs must also undergo regional consultations among Member States.7575 ibid art 12. The NECPs must include a description of their preparatory process, including how the public and regional consultations have been taken into account.7676 ibid art 3(a). The proposed European Climate Law would introduce an obligation for the Commission to ‘engage with all parts of society’ and ‘facilitate an inclusive and accessible process at all levels’, also drawing from the multilevel climate and energy dialogues.7777 European Climate Law Proposal (n 4) art 8. Despite these improvements, the situation is not ideal as the Governance Regulation and European Climate Law proposal only address the right of the public to be consulted, not the other two sets of public participation rights in the Aarhus Convention7878 United Nations Economic Commission for Europe (UNECE) Convention on Access to Information, Public Participation in Decision-Making and Access to Justice in Environmental Matters (adopted 25 June 1998, entered into force 30 October 2001) 2161 UNTS 447. concerning access to information and justice.7979 Duwe et al (n 31) 10. See also M Peeters and S Nóbrega, ‘Climate Change-Related Aarhus Conflicts: How Successful are Procedural Rights in EU Climate Law?’ (2014) 23 Review of European, Comparative and International Environmental Law 354.

3.1.5 Assessment of the Governance Regulation

The main contribution of the Governance Regulation to EU climate and energy law includes the introduction of more integrated and detailed planning and reporting requirements, and the strengthening of the Commission’s role especially in ex ante monitoring. Overall, the Governance Regulation thereby entails a further proceduralization of EU climate and energy law. Also noteworthy is that the Regulation goes some way towards mitigating the omission of binding national renewable energy targets from RED II. Regarding enforcement, concerns have been raised about the emphasis on recommendations, as these have not been particularly effective in the context of the European Semester, an annual process through which the EU coordinates and monitors budgetary, fiscal, economic and social policies and creates a space for discussing these issues between the EU institutions and Member States.8080 Vandendriessche et al (n 29) 7. Legally, recommendations carry less weight than infringement proceedings, with the latter potentially resulting in penalties and legal obligation to comply with the rulings by the Court of Justice of the EU. Also, the adoption of new legally binding measures in response to insufficient ambition and implementation is likely to require Member State approval and potentially difficult political negotiations to revise legislation.8181 ibid. Overall, the Governance Regulation is much stronger on process than on enforcement.

Looking from a broader perspective, the Governance Regulation includes provisions on planning and monitoring typically included in national framework laws on climate change,8282 M Duwe et al, ‘Climate Laws in Europe: Good Practices in Net Zero Management’ (Ecologic Institute 2019). while strongly reflecting the sui generis nature of the EU. Compared with the strongest framework laws on climate change,8383 Climate Change Act 2008 (United Kingdom) <http://www.legislation.gov.uk/ukpga/2008/27/contents>. the Governance Regulation leaves some important gaps. These include the absence of long- and mid-term emission reduction targets and an independent scientific advisory body.8484 N Meyer-Ohlendorf and L Meinecke, ‘A Climate Law for Europe. Making the Paris Agreement Real’ (Ecologic Institute 2018). The proposed European Climate Law would further develop the Governance Regulation and address most – but not all – of the gaps. It would enshrine in law a 2050 climate neutrality target. It would subject the EU emission trajectory towards 2050 to a review at five-year intervals and give the Commission powers to adopt delegated acts to determine an EU-wide emission reduction trajectory from 2030 to 2050.8585 European Climate Law Proposal (n 4) 14–15. The European Climate Law would also complement the Governance Regulation’s monitoring provisions through an obligation for the Commission to evaluate progress towards the 2050 climate neutrality target at the EU and Member State levels.8686 ibid 15.

3.2 The climate component of the 2030 Framework

3.2.1 EU ETS

Launched in 2005, the EU ETS has capped greenhouse gas emissions and created a price for them in the covered sectors, namely power generation, iron and steel, chemicals, oil refineries, cement and other building materials, as well as pulp and paper. In addition, the ETS applies to aviation emissions in the participating countries. However, the performance of the ETS has been mixed and it has experienced severe demand shocks leading to very low carbon prices.8787 G Perino and M Wilner, ‘Procrastinating Reforms: The Impact of Market Stability Reserve on the EU ETS’ (2016) 80 Journal of Environmental Economics and Management 37; P Bayer and M Aklin, ‘The European Union Emissions Trading System Reduced CO₂ Emissions Despite Low Prices’ (2020) 117 Proceedings of the National Academy of Sciences of the United States of America 8804. As a result, the ETS already underwent important reforms shortly before the 2030 Framework. Notably, the Market Stability Reserve (MSR) was created in 2015 and started operating in 2019 to trigger adjustments to the annual volumes of EU allowances (EUAs) and address extremes in supply or demand by automatically withdrawing or increasing the number of EUAs on the market.8888 Decision (EU) 2015/1814 of the European Parliament and of the Council of 6 October 2015 concerning the establishment and operation of a market stability reserve for the Union greenhouse gas emission trading scheme and amending Directive 2003/87/EC [2015] OJ L264/1. As part of the 2030 Framework, it was agreed that the MSR’s annual intake of EUAs would temporarily double in 2019–2023 from 12 to 24 percent of the total number of allowances in circulation.8989 ibid art 1(5) and ETS Amending Directive (n 17) recital 23.

Other key changes to the ETS in the 2030 Framework relate to the tightening of the emissions cap and tweaking of rules designed to prevent that greenhouse gas emissions are shifted outside the EU rather than effectively reduced (‘carbon leakage’). Furthermore, the 2030 Framework introduced new funding mechanisms to support actors in the power sector and industry. These include the Innovation Fund to which 400 million EUAs have been allocated.9090 ETS Amending Directive (n 17) art 10(a)(8). The Fund seeks to support innovation in low-carbon technologies and funds demonstration projects for breakthrough technologies in all Member States. Furthermore, the Modernization Fund has been created to facilitate investments in the power sector in lower-income Member States (i.e. 10 Central and Eastern European Member States) with 2 percent of the overall quantity of EUAs.9191 ibid art 10(d).

Tightening the emissions cap and tweaking carbon leakage rules

Sectors included in the ETS are expected to reduce emissions by 43 percent from 2005 levels by 2030. To achieve this, the ETS emissions cap will start declining by 2.2 percent each year from 2021 onwards9292 ibid art 9. as opposed to the 1.74 percent annual reduction applicable since 2013.

With the 2020 Package, auctioning became the main method of allocating EUAs to the power sector. However, free allocation has been available to enable lower-income Member States (essentially Central and Eastern European Member States) to modernize their power sector and will remain so under the 2030 Framework.9393 ibid art 10(c). For industrial sectors not exposed to carbon leakage, free allocation will be gradually phased out by 2030. By contrast, industries exposed to the risk of carbon leakage have received most of their EUAs for free. This will continue under the 2030 Framework with some modifications to address overly generous allocations and windfall profits for some operators under the 2020 Package.9494 On over-allocation and windfall profits, see E Joltreau and K Sommerfeld, ‘Why Does Emissions Trading under the EU Emissions Trading System (ETS) not Affect Firms’ Competitiveness? Empirical Findings from the Literature’ (2019) 19 Climate Policy 453.

The Commission regularly draws up a list of sectors exposed to the risk of carbon leakage. In the 2030 Framework, the methodology has been revised to make the list of exposed sectors ‘more targeted’.9595 Commission (EU) ‘Proposal for a Directive amending Directive 2003/87/EC to enhance cost-effective emission reductions and low-carbon investments’ COM(2015) 337 final, 15 July 2015, 3. The carbon leakage list for 2021–2030 covers 94 percent of the EU’s industrial emissions and 98 percent of emissions included in the previous carbon leakage list for 2015–2020.9696 V Graichen et al, ‘The Role of EU ETS in Increasing EU Climate Ambition: Assessment of Policy Options’ (Sitra 2019). The question remains whether further modifications are needed for the ETS to better drive low-carbon innovation and investment.9797 ibid 50–51.

The 2030 Framework also introduced revisions to the benchmark system that has been used since the 2020 Package for allocating free allowances to industry and rewarding the most energy efficient installations so that only those receive all EUAs for free. Under the 2020 Package, the benchmarks were calculated based on average greenhouse gas emission performance in the 10 percent best performing EU installations in 2007–2008.9898 ETS Amending Directive (n 17) art 10(a)(2). This initially constituted an incentive for installations to increase their efficiency to reduce their need for EUAs. However, the incentive declined over time due to improvements in operators’ technical capacities and efficiency. To prevent the same from happening under the 2030 Framework, the benchmarks will be updated twice during the 2021–2030 period.9999 ibid art 10(6)(c).

Assessment of modifications to the ETS Directive

In addition to creating new funding mechanisms for innovation and modernization, and temporarily doubling the annual intake of EUAs by the MSR, the 2030 Framework has strengthened the emissions cap and free allocation rules. While useful, the latter two reforms might be relatively short-lived. First, the EGD foresees a Commission proposal in mid-2021 for a carbon border adjustment mechanism to address carbon leakage in select sectors.100100 EGD (n 5) Annex II. The idea of carbon border adjustments has been debated for well over a decade and remains controversial.101101 For a supportive view, see M Mehling et al, ‘Designing Border Carbon Adjustments for Enhanced Climate Action’ (2019) 113 American Journal of International Law 433. The basic idea is to target imports competing with select ETS sectors and adjust their price, for example, through an obligation to surrender EUAs. If adopted, such a mechanism is likely to trigger revisions to the free allocation rules in the ETS Directive. Such revisions would not least be required because charging imports to the EU while giving free allowances to their competitors under the ETS would almost certainly violate World Trade Organization law.

Second, as part of the EGD, the Commission is preparing a comprehensive plan to increase the EU’s 2030 emissions target to 50–55 percent.102102 EGD (n 5) Annex II. In the literature, proposed reforms to the ETS to achieve more ambitious emission reductions include further increasing the annual linear reduction factor, strengthening the MSR and introducing a carbon floor price.103103 Graichen et al (n 96) 161. See also C Fisher et al, ‘The Legal and Economic Case for an Auction Reserve Price in the EU Emissions Trading System’ (2020 fc) Columbia Journal of European Law (forthcoming).

3.2.2 Effort Sharing Regulation

Under the 2030 Framework, the effort sharing sectors – transport, waste, buildings, agriculture and industry not included in the ETS – must collectively reduce emissions by 30 percent from 2005 levels. The ESR defines binding national targets for all Member States differentiated based mainly on per capita gross domestic product (GDP).104104 The targets have been adjusted, however, to reflect cost-effectiveness for those Member States with an above average GDP per capita; ESR (n 20) recital 2. See further M Peeters and N Athanasiadou, ‘The Continued Effort-Sharing Approach in EU Climate Law: Binding Targets, Challenging Enforcement?’ (2020) 29 Review of European, Comparative and International Environmental Law 201. For 2030, these range from 0 to 40 percent. Compared with the 2020 Package, the legal form of the relevant instrument has changed from a Decision to a Regulation. Substantive changes include new flexibilities involving LULUCF and ETS credits.

Annual emission allocations and flexibilities

The ESR requires Member States to reduce emissions through a linear reduction trajectory between 2021 and 2030,105105 ESR (n 20) art 4(1)–(2). continuing to use annual carbon budgets known as annual emission allocations. Also, certain flexibilities – banking, borrowing and trading – remain available.

The ESR has introduced two new flexibilities.106106 See S Romppanen, ‘The EU Effort-Sharing and LULUCF Regulations: Complementary yet Crucial Components of EU’s Climate Policy beyond 2030’ in M Peeters and M Eliantonio (eds), Research Handbook of European Environmental Law (Edward Elgar 2020) 428. First, nine eligible Member States listed in Annex II of the ESR can cover a defined part of their emission reductions (corresponding to up to 2 percent of their 2005 emissions) in non-ETS sectors through EUAs from the ETS that would have normally been auctioned.107107 ESR (n 20) art 6. This flexibility is available for Member States whose targets are significantly above both the EU average and their cost-effective emission reduction potential, as well as for Member States who did not allocate any EUAs for free to industrial installations in 2013.108108 ibid recital 21 At the EU level, the limit of this flexibility is 100 million tonnes of carbon dioxide equivalent.109109 ibid art 6(1). Second, as detailed below, Member States may each use a specified quota of credits from the LULUCF sector to comply with their national targets under the ESR.110110 ibid art 7 and Annex III.

Assessment of the ESR

The ESR maintains the basic approach applicable under the 2020 Framework while introducing two new flexibilities. Especially the possibility of using credits from the LULUCF sector has generated controversy: it has been argued that this flexibility effectively weakens the EU’s 2030 target.111111 For example, in CJEU, Case T-330/18, Carvalho and Others v Parliament and Council, ECLI:EU:T:2019:324. See for a discussion S Bogojević, ‘Human Rights of Minors and Future Generations: Global Trends and EU Environmental Law Particularities’ (2020) 29 Review of European, Comparative and International Environmental Law 191. However, its total amount is limited, representing 1 percent of emissions in the effort sharing sectors in 2005.112112 Savaresi et al (n 23). The continued availability of borrowing between annual carbon budgets has also been criticized as allowing the Member States to delay action instead of urgently mitigating climate change.113113 Romppanen (n 106).

3.2.3 LULUCF Regulation

The inclusion of the LULUCF sector is a key new element in the 2030 Framework. Whereas it had been considered to include the sector as part of the ESR, it was eventually decided to treat it as a separate third pillar of EU climate policy.114114 Savaresi et al (n 23). However, there are important linkages between the LULUCF and ESR in the form of flexibilities.

The no-debit rule and the land accounting categories

The cornerstone of the LULUCF Regulation is the no-debit rule, an obligation for Member States to ensure that their emissions from the LULUCF sector do not exceed the amount of greenhouse gases that the sector absorbs.115115 LULUCF Regulation (n 22) art 4. Compliance with this requirement will be assessed during two five-year periods (2021–2025 and 2026–2030). Changes in carbon stock during these periods will be accounted for in accordance with the rules of the Regulation.

Compared with the EU’s current LULUCF accounting system based on the Kyoto Protocol, the LULUCF Regulation expands the scope of accounting from forests to all managed land.116116 A Matthews, ‘Accounting for the LULUCF Sector in the EU’s 2030 Climate Targets’ (CAP Reform, 29 July 2019) <http://capreform.eu/accounting-for-the-lulucf-sector-in-the-eus-2030-climate-targets/>. The Regulation initially includes five mandatory accounting categories: afforested land, deforested land, managed cropland, managed grassland and managed forests.117117 LULUCF Regulation (n 22) art 2(1). As of 2026, managed wetlands will be added as a sixth mandatory category.118118 ibid.

Emissions from afforested and deforested land are accounted for in full, whereas net–net accounting is used for managed cropland, managed grassland and wetlands, whereby net changes in emissions and removals are compared with a 2005–2009 baseline.119119 Matthews (n 116). A special form of net–net accounting applies to managed forests, which are accounted for against a reference level (see below). Net–net accounting means that not all emissions and removals that are reported from the LULUCF sector under the United Nations rules are considered for the purposes of accounting compliance with the LULUCF target.120120 ibid.

Managed forests are the largest and most important accounting category.121121 Savaresi et al (n 23). Each Member State must develop a National Forestry Accounting Plan (NFAP)122122 LULUCF Regulation (n 22) art 8(3). that includes a Forest Reference Level (FRL),123123 ibid art 8(4)–(5) and section A of Annex IV. which can be characterized as a forward-looking scenario on how carbon stocks in managed forests (where trees are planted and harvested) would evolve if there were no changes in forest management practices (i.e. human interventions affecting forest composition and structure through various silvicultural activities).124124 Romppanen (n 106). This approach was chosen, among others, to exclude changes in carbon stock due to actions taken prior to the start of the compliance period,125125 ibid. in other words, with the aim of only accounting for anthropogenic impacts of changes in forest management practices.126126 H Böttcher et al, ‘EU LULUCF Regulation Explained: Summary of Core Provisions and Expected Effects (Öko Institut 2019) 10.

FRLs must be established based on continuation of sustainable forest management practices as documented in the reference period of 2000–2009.127127 LULUCF Regulation (n 22) art 8(5). The FRL thus relies on historical data, whereas the corresponding system under the Kyoto Protocol allowed the inclusion of policy assumptions, such as the future use of bioenergy, in the FRL.128128 Böttcher et al (n 126) 22. Changes in forest carbon stock during a compliance period are then accounted for against the FRL. The rationale of using FRLs instead of simply calculating the size of the reservoir is that emissions and removals from forest land depend on several circumstances. These include dynamic age-related forest characteristics (e.g. maturity of trees for harvesting) as well as past and present forest management practices, which differ from one Member State to another.129129 Commission (EU) ‘Assessment of the National Forestry Accounting Plans’ (Staff Working Document) SWD(2019) 213 final, 18 June 2019 (NFAP Assessment) 3. The function of the FRLs is to exclude effects of natural and country-specific characteristics.130130 ibid. For example, increased wood harvesting for bioeconomy purposes will lead to carbon debits.131131 GJ Nabuurs et al, ‘Effects of the EU LULUCF Regulation on the Use of Biomass for Bioenergy’ (Wageningen University 2018) <https://edepot.wur.nl/449788>. Conversely, if the forest carbon stock increases above the FRL, this will result in carbon credits.132132 Savaresi et al (n 23).

The establishment of the NFAPs and FRLs occurs through an iterative process133133 LULUCF Regulation (n 22) art 8(3) and Annex IV. resembling the NECP process under the Governance Regulation. The first draft NFAPs were due by 31 December 2018.134134 ibid art 8(3). The Commission then assessed them in consultation with experts135135 Commission Expert Group on Land Use, Land Use Change and Forestry (LULUCF), ‘2nd Meeting of Expert Group on Land Use, Land Use Change and Forestry (LULUCFEG)’ <https://ec.europa.eu/transparency/regexpert/index.cfm?do=groupDetail.groupMeeting&meetingId=12931>. and provided technical recommendations.136136 LULUCF Regulation (n 22) art 8(6); and NFAP Assessment (n 129). The final NFAPs were due by 31 December 2019, after which the Commission will define by 31 October 2020 through delegated acts the FRLs to be applied by the Member States during the first compliance period.137137 LULUCF Regulation (n 22) art 8(8). Subject to the same iterative process, the draft NFAPs for the second compliance period are due in June 2023.138138 ibid art 8(3). Member States must submit compliance reports for the two compliance periods by 15 March 2027 and 15 March 2032, respectively.139139 ibid art 14(1). The Commission, assisted by the European Environment Agency, will then review the reports and prepare EU-level reports on LULUCF emissions and removals for the two respective compliance periods.140140 ibid art 14(2)–(4).

Flexibilities

Compliance with the ‘no debit’ rule is assessed based on a total sum of emissions and removals from all six land accounting categories.141141 ibid art 4. The starting point is that the Member States must compensate debits in one land accounting category with removals in other land accounting categories.142142 ibid. This is known as intra-LULUCF flexibility.143143 Savaresi et al (n 23). However, credits from managed forests entered into the accounts cannot exceed 3.5 percent of the Member State’s base year emissions,144144 ibid. See also Matthews (n 116). mirroring similar capping of removals under the Kyoto Protocol.

The LULUCF Regulation also allows flexibilities between the compliance periods and between Member States, who can: (i) bank removals from the first compliance period in 2021–2025 and use them during the second compliance period 2026–2030;145145 LULUCF Regulation (n 22) art 12(3). and (ii) sell and transfer extra removals to another Member State.146146 ibid art 12(2).

The fourth flexibility within the LULUCF sector is known as managed forest-land flexibility, which can only be used if certain conditions are met. First, the EU as a whole must have a credit in the LULUCF sector.147147 ibid art 13(2). See also Matthews (n 116). Second, a Member State using this flexibility must have taken specific measures to conserve or enhance its forest sink.148148 LULUCF Regulation (n 22) art 13(2). This flexibility allows each Member State to have a debit in the managed forests land accounting category as specified in Annex VII of the LULUCF Regulation.149149 ibid art 13 and Annex VII. The total cumulative amount for this flexibility is 360 million tonnes of carbon dioxide equivalent. Its rationale was to overcome strong resistance from forest-rich countries150150 As part of the compromise, Article 13(4) of the LULUCF Regulation grants Finland a special flexibility of 10 million tonnes of carbon dioxide equivalent on top of its standard flexibility allowance under Article 13(2) of 44.1 million tonnes. to the new forest accounting rules.151151 Böttcher et al (n 126) 22. This flexibility thus benefits Member States with a sizable forest sink and allows them to balance potential net emissions from managed forests.152152 ibid.

A maximum of 263.6 million credits153153 The maximum amount defined in the ESR for the EU as a whole is 280 million tonnes of carbon dioxide equivalent with a 16.37 million tonnes share for the United Kingdom, which left the EU in 2020. from the LULUCF sector can also be used in 2021–2030 to comply with the targets defined in the ESR.154154 ESR (n 20) art 7; and LULUCF Regulation (n 22) art 12. The Member States’ individual shares are based on the significance of agricultural emissions in the effort sharing sectors that are particularly difficult to abate.155155 Matthews (n 116). Conversely, in case the LULUCF sector generates debits, Member States may compensate these through stronger emission reductions in other sectors covered by the ESR.156156 LULUCF Regulation (n 22) art 12(1).

Assessment of the LULUCF Regulation

The LULUCF Regulation has strengthened the previously applicable accounting system under the Kyoto Protocol.157157 Böttcher et al (n 126) 28; Savaresi et al (n 23). It covers the LULUCF sector more comprehensively and is stricter in considering the intensification of forest management practices.158158 Böttcher et al (n 126) 28. LULUCF accounting has also become more transparent, including with the involvement of the Commission as well as national and individual experts in reviewing the Member States’ NFAPs and FRLs.159159 ibid.

A much-criticized aspect of the 2020 Package has been that biomass burning for energy was considered carbon neutral under the 2009 Renewable Energy Directive (RED I).160160 RED I. Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC [2009] OJ L140/16. RED II also includes strong incentives to increase the use of wood for bioenergy (see Section 3.3.1).161161 Böttcher et al (n 126) 29. Under the 2030 Framework, the climate impact of increased reliance on bioenergy will be accounted for under the LULUCF Regulation.162162 ibid. This improves the situation given the stricter rules concerning FRLs, including the exclusion of impacts of future bioenergy policies from the FRLs.163163 ibid. By contrast, the 2020 rules permit assumptions on increased harvesting and declining forest carbon stock to be included in the FRL. However, as Savaresi and colleagues demonstrate,164164 Savaresi et al (n 23). it remains questionable whether the forest biomass problem has been adequately addressed by the LULUCF Regulation and the new sustainability criteria for biofuels in RED II (see Section 3.3.1).

In the long term, the LULUCF sector’s role in EU climate policy is likely to increase. Achieving the 2050 climate neutrality goal will require negative emissions and the Commission’s 2050 climate neutrality scenarios thus emphasize that ‘carbon sinks are as important as reducing emissions’.165165 Commission (EU) (n 45) 14. Challenges include that the EU sink has been projected to decline by 25 percent by 2050 from the 2015 level166166 Böttcher et al (n 126) 23. and that forests remain largely within the national competence of the Member States. Indeed, some heavily forested Member States saw the LULUCF Regulation as an unwelcome interference with their national policy domain and oppose further EU policies in this sector.167167 On related challenges in negotiations for the LULUCF Regulation, see Savaresi et al (n 23). See also E Sánchez Nicolàs, ‘Finland Fights to Keep Control of Forests away from EU’ (EUObserver, 30 October 2019). The EGD foresees, however, the development of a new European Forest Strategy in 2020 as well as a review of the LULUCF Regulation along with other measures of the 2030 Framework. Against this background, the LULUCF Regulation is likely only the first step in the evolution of EU climate law in this sector.

3.3 The energy component of the 2030 Framework

3.3.1 RED II

RED II introduces several important changes and innovations. Our focus is on the switch to an overall EU renewable energy target, national support schemes, self-consumers and renewable energy communities, renewables in heating and cooling as well as in transport, including biofuels (comprising bioliquids, biogas and biomass fuels).

Overall EU target

The European Council agreed in October 2014 that renewable energy should account for ‘at least 27%’ of EU energy consumption in 2030,168168 European Council, ‘Conclusions’, EUCO 169/14 (24 October 2014) para 3. while the European Parliament demanded a 35 percent target.169169 F Simon, ‘EU Parliament Wins Plaudits for Backing 35% Renewables Target’ (EurActiv, 18 January 2018). As the costs of renewable energy technologies had dropped, support for a more ambitious target grew.170170 F Simon, ‘Fresh EU Analysis Makes Case for Higher Renewables, Energy Saving Goals’ (EurActiv, 2 March 2018); S Morgan, ‘EU Member States Warm Up to Parliament’s Energy Stance’ (EurActiv, 20 April 2018). Eventually, agreement was reached on a target of ‘at least 32%’ by 2030 and a review by 2023 with a view to increasing the target.171171 RED II (n 19) art 3(1).

Although the European Parliament originally favoured a continuation of binding national targets, it had to yield on this point. As a result, Member States have to ‘collectively ensure’ that the 32 percent target is achieved as a ‘binding overall Union target’.172172 ibid art 3(1)–(2). As discussed above, RED II, in combination with the Governance Regulation, further elaborates what this bindingness at the EU level – which is not an established concept – will mean in reality. Member States continue to have flexibility mechanisms available in achieving their national contributions, including statistical transfers, joint projects with other Member States or with third States.173173 ibid arts 8–12. See Monti and Martinez Romera (n 59).

Implementation of the renewable energy target is to be ensured through the system of planning, reporting and monitoring under the Governance Regulation (see Section 3.1). Two aspects make renewable energy governance stronger than other aspects covered by the Governance Regulation. First, as discussed above, the Regulation indirectly establishes indicative targets for individual Member States by defining criteria and a formula for their calculation.174174 Governance Regulation (n 21) art 5(1)(e) and Annex II. Second, underperforming Member States will be under enhanced obligations to catch up and must ensure the gap is filled through additional measures to be implemented within one year, with the menu of possible measures including voluntary payments into a newly created ‘Union renewable energy financing mechanism’.175175 ibid. Each Member State concerned is required to report on these measures in their biennial progress reports.176176 ibid art 32, especially paras 1–3 and 7; RED II (n 19) art 3(2).

Interestingly, and perhaps logically, the 2030 Framework also seems to soften the 2020 national renewable energy targets under RED I, under which the targets were seen as legally binding, implying the possibility of a recourse to infringement proceedings. While using the 2020 targets as a baseline for the future, RED II softens their bindingness towards the 2030 Framework. It does so by indicating that underperforming Member States are ‘deemed to be in compliance’ if they take additional measures that succeed in closing the gap.177177 Governance Regulation (n 21) art 32(4) with RED II (n 19) art 3(4).

Renewable energy support schemes

Despite enormous declines in cost, many renewables technologies remain dependent on support. Member States have thus deployed a variety of support schemes, most prominently feed-in tariffs ensuring a fixed payment for renewable electricity. The Commission has issued related State Aid Guidelines to minimize interference with EU State Aid rules, favouring the abandonment of fixed feed-in tariffs.178178 EL Boasson, ‘Constitutionalization and Entrepreneurship: Explaining Increased EU Steering of Renewable Support Schemes’ (2019) 7 Politics and Governance 70.

RED II authorizes Member States to apply renewable energy support schemes and requires that direct price support schemes take the form of a market premium (i.e. a top-up on market prices).179179 RED II (n 19) arts 4(1) and 4(3). It also establishes parameters for tendering procedures,180180 ibid art 4(4)–(5). the preferred way of providing support under existing State Aid Guidelines.181181 ibid art 4(8). In addition, the Directive prohibits Member States from implementing retroactive changes to support schemes, a problem that occurred in several Member States in the 2010s.182182 ibid art 5.

Renewables self-consumers and renewable energy communities

The 2030 Framework introduces new provisions designed to promote decentralized energy and to foster bottom-up participation. First, RED II defines ‘renewable energy communities’ as legal entities that are based on open and voluntary participation.183183 ibid art 2(16), which includes further requirements. See also J Roberts, ‘Power to the People? Implications of the Clean Energy Package for the Role of Community Ownership in Europe’s Energy Transition’ (2020) 29 Review of European, Comparative and International Environmental Law 232; A Savaresi, ‘The Rise of Community Energy from Grassroots to Mainstream: The Role of Law and Policy’ (2019) 31 Journal of Environmental Law 487. Members of a renewable energy community must be located in the proximity of the renewable energy project they own and develop, and the community’s primary purpose must be providing environmental, economic and social community benefits rather than financial profits.184184 RED II (n 19) art 2(16).

Another new concept in RED II is that of a ‘self-consumer’. This is defined as ‘a final customer … who generates renewable electricity for its own consumption, and who may store or sell self-generated renewable electricity’, on the condition that these are not the primary commercial or professional activities of non-household renewable-energy self-consumers.185185 ibid art 2(14).

RED II obliges Member States to promote and facilitate the development of renewables self-consumption and renewable energy communities and to refrain from discriminating against them.186186 ibid arts 21–22. It also establishes several entitlements for both renewables self-consumers and renewable energy communities relating to the generation, consumption, storage and selling of renewable electricity and fair remuneration for electricity fed into the grid at least at market value, including non-discrimination with respect to charges, levies and taxes as well as procedures.187187 ibid.

Advancing renewables in transport and heating and cooling

RED II also includes provisions to promote renewable energy in sectors other than electricity, namely transport as well as heating and cooling. This reflects an evolving trend from the 2001 Renewable Electricity Directive through to RED I.

RED II includes targets for both areas. It requires the Member States to ‘endeavour to increase’ the share of renewable energy in heating and cooling by ‘an indicative 1.3 percentage points’ per year on average,188188 ibid art 23(1). including through increased renewable energy shares in district heating and cooling.189189 ibid art 24. The transport sector target was not part of the original Commission proposal given controversies surrounding biofuels, but introduced by the co-legislators during the negotiations.190190 ‘MEPS Raise Ambition on Transport with Sustainable Biofuels’ (EurActiv, 29 July 2017). As a result, the 10 percent target for renewable energy by 2020 was increased to 14 percent by 2030. The target applies to all Member States, which ‘shall set an obligation on fuel suppliers’ to ensure this target. Also this target will be reviewed by 2023 with a view to possibly increasing it.191191 RED II (n 19) art 25(1). As explained below, the transport sector target includes two major safeguards due to sustainability concerns related to biofuels. Detailed rules for calculating the renewable energy share in the transport sector establish special bonuses for advanced biofuels and renewable electricity.192192 ibid arts 27–28.

Addressing sustainability concerns related to biofuels

Biofuels raise various concerns regarding their sustainability, including that they compete with food and feed production and incentivize land-use change, in particular deforestation. This is known as indirect land-use change (ILUC) and could lead to greenhouse gas emissions that may even exceed the savings made through the replacement of fossil fuels.193193 K Araujo et al, ‘Global Biofuels at the Crossroads: An Overview of Technical, Policy, and Investment Complexities in the Sustainability of Biofuel Development’ (2017) 7 Agriculture 32; N Kupzok, ‘Fragile Legitimacy: The Rise and Crisis of the EU’s “Sustainable Biofuels” Policy’ (2020) 18 Socio-Economic Review 235.

In response to criticism concerning the sustainability of biofuels as one of the primary means for achieving the transport sector target,194194 ibid. two major safeguards were included in RED II. First, it seeks to promote advanced biofuels not produced from food or feed crops through a sub-target to increase their share from 0.2 percent in 2022 to 3.5 percent in 2030.195195 RED II (n 19) art 25(1). By contrast, it caps the use of ‘first-generation biofuels’ from food and feed crops to a maximum of 7 percent (i.e. half of the overall target), and the use of biofuels at high risk of ILUC and related greenhouse gas emissions at 2019 levels, with a subsequent phase out by 2030.196196 ibid art 26(1)–(2). There are exemptions for biofuels certified as being low ILUC risk. Indonesia has recently challenged the compatibility of the EU’s regulatory framework on ILUC with World Trade Organization law.197197 European Union – Certain Measures Concerning Palm Oil and Oil Palm Crop-Based Biofuels, Request for the Establishment of a Panel by Indonesia, Panel Report, WT/DS593/9 (24 March 2020).

Furthermore, RED II strengthens and expands the biofuels sustainability criteria of RED I.198198 See RED II (n 19) art 29(1). Notably, while the sustainability criteria under RED I only covered bioliquids, sustainability requirements now apply to solid and gaseous biomass fuels as well.199199 ibid. The exemption of forest biomass under the 2020 Package was particularly controversial given the prominence of forest biomass in supplying the EU’s domestic bioenergy.200200 ‘Biomass “Insanity” May Threaten EU Carbon Targets’ (EurActiv, 2 April 2012). As discussed by Savaresi and colleagues, the sustainability of biomass used for energy in the EU is now regulated through a regime comprising RED II and the LULUCF Regulation, although questions concerning the regime’s adequacy can still be raised.201201 Savaresi et al (n 23).

Mirroring the previous legal framework, RED II retains the requirement that biofuels from agricultural biomass can only count towards the overall renewable energy targets and benefit from financial support if the raw material was not generated on land that, in January 2008, had a high biodiversity value or a high carbon stock or was peatland.202202 RED II (n 19) arts 29(1) and 29(3)–(5). The countries of origin of forest biomass used for biofuels are required to have effective regulatory or management systems in place, including for the LULUCF sector.203203 ibid art 29(6)–(7). RED II also determines minimum calculated greenhouse gas emission savings from the use of biofuels in transport and for installations producing bioliquids that increase over time.204204 ibid art 29(10). Finally, electricity generation installations above 50 megawatts burning biomass have to achieve certain minimum efficiency levels.205205 ibid art 29(11).

Assessment of RED II

As of June 2020, the EU as a whole remains roughly on track to achieving its 2020 target of a 20 percent share of renewable energy in final energy consumption. The COVID-19 crisis further bolsters that prospect as it has dampened energy consumption, which increases the renewable energy share. At the same time, considerable differences of over- and under-achievement remain apparent between Member States and the dynamics of renewable energy expansion have slowed in the run-up to 2020.206206 European Environment Agency (EEA), ‘Share of Renewable Energy in Gross Final Energy Consumption in Europe’ (EEA 2019); European Environment Agency, ‘Trends and Projections in Europe 2019: Tracking Progress towards Europe’s Climate and Energy Targets’ (EEA 2019) (EEA, ‘Trends and Projections’). Furthermore, the prospects for an accelerated increase towards the 2030 target of 32 percent remain uncertain.207207 ibid. See also Commission (EU) (n 36); and Section 3.1.

Whether RED II, in combination with the Governance Regulation, will be sufficient to spur renewable energy deployment in line with the 2050 climate neutrality objective also remains uncertain. The costs of renewable energy are expected to continue to decrease, which is likely to support the shift to renewables, together with an ETS that increases the cost of fossil fuels in the power sector in particular. At the same time, binding national renewable energy targets have been replaced by a system that is based on national contributions, strengthened review and monitoring and joint assessment of progress. While not necessarily less stringent than under the 2020 Package, the new system still has to prove its effectiveness (also in sectors not covered by the ETS).208208 S Oberthür, ‘Hard or Soft Governance? The EU’s Climate and Energy Policy Framework for 2030’ (2019) 7 Politics and Governance 17. Having said that, RED II is to be further developed as part of the EGD and renewables may well be a focus of COVID-19 recovery programmes.209209 EGD (n 5).

3.3.2 Energy Efficiency Directive

The 2012 Energy Efficiency Directive210210 Directive 2012/27/EU of the European Parliament and of the Council of 25 October 2012 on energy efficiency, amending Directives 2009/125/EC and 2010/30/EU and repealing Directives 2004/8/EC and 2006/32/EC [2012] OJ L315/1. established the first encompassing framework for energy efficiency in the EU, covering a wide range of issues from national energy efficiency targets to a range of detailed measures on building renovation, efficiency in heating and cooling, energy transformation, transmission and distribution, energy services, and others. The overall framing was largely procedural in that Member States were obliged to submit National Energy Efficiency Action Plans specifying their national targets and measures, as well as annual progress reports.211211 ibid. The 2018 revision introduced limited changes concerning the headline target and the system of implementation by Member States.

Other legal instruments beyond the 2030 Framework also play an important role in promoting energy efficiency. The Ecodesign Directive212212 Directive 2009/125/EC of the European Parliament and of the Council of 21 October 2009 establishing a framework for the setting of ecodesign requirements for energy-related products [2009] OJ L285/10. is particularly relevant in terms of setting energy efficiency requirements for various products sold in the EU. It is, however, beyond the scope of the present article.

New headline target

The major innovation concerns the strengthening of the energy efficiency target. While the European Council had originally envisaged a 27 percent target, along with a possible upgrade to 30 percent,213213 European Council (n 168). the European Parliament even demanded a 35 percent target.214214 European Parliament, Industry, Research, and Energy (ITRE), ‘Review of the Renewable Energy Directive 2009/28/EC to Adapt it to the EU 2030 Climate and Energy Targets’ <https://www.europarl.europa.eu/legislative-train/api/stages/report/current/theme/industry-research-and-energy-itre/file/jd-renewable-energy-directive-for-2030-with-sustainable-biomass-and-biofuels>. In the end, the co-legislators settled for a target of 32.5 percent. As a ‘headline target’, it remains indicative so that Member States remain free to determine how much and through which means they will contribute to it.215215 Energy Efficiency Directive (n 18) art 1 and recital 6.

Progress towards the target continues to be calculated relative to a business-as-usual scenario from 2007 that foresaw growing energy consumption. Consequently, the 32.5 percent energy efficiency improvement is equivalent to a 26 percent reduction of primary energy consumption and a 20 percent reduction of final energy consumption from 2005 levels. Primary energy consumption and final energy consumption in the EU in 2030 should therefore not exceed 1,273 and 956 million tonnes of oil equivalent, respectively.216216 ibid art 3(5) and recital 6.

Like other core elements of the 2030 Framework, the Commission is instructed to review the energy efficiency target in 2023 with a view to an upward revision ‘in the event of substantial cost reductions resulting from economic or technological developments, or where needed to meet the Union’s international commitments for decarbonisation’.217217 ibid art 3(6). Under the EGD, this schedule is expected to be accelerated for mid-2021.218218 EGD (n 5) 6.

Implementation by Member States

The Energy Efficiency Directive requires Member States to ‘bring into force the laws, regulations and administrative provisions necessary to comply with’ its main provisions by 25 June 2020.219219 Energy Efficiency Directive (n 18) art 2(1). The major vehicle for implementation is the system of planning and reporting under the Governance Regulation. Accordingly, national energy efficiency targets are to be included in NECPs, along with the planned policies and measures, and implementation (as well as any updates to the contribution) must be reported in the biennial progress reports (see Section 3.1). There is little guidance on how to calculate a fair national energy efficiency contribution (in contrast to national renewable energy contributions). While the 2018 revisions provide some further guidance to Member States on the selection of energy efficiency measures, they fail to establish clear-cut obligations, and leave a high degree of discretion to Member States in designing national policies and measures.220220 ibid arts 7, 7a and 7b.

Assessment of the revised Energy Efficiency Directive

The EU has so far had a mixed track record on energy efficiency. Energy consumption has declined to some extent since 2005, but the Union seemed off track for reaching its 2020 energy efficiency target. The COVID-19 crisis is likely to reduce energy consumption just in time for achieving the 20 percent target – though not as a result of policies and measures. Strong additional measures will be required to achieve the 2030 target.221221 EEA, ‘Trends and Projections’ (n 206); Commission (EU) (n 36). In practice, EU measures such as energy efficiency standards for appliances under the Ecodesign Directive play an important role, but measures undertaken at Member State level (e.g. addressing buildings) are also key.

As a consequence, much will depend on the NECP process under the Governance Regulation. Member States will have to be nudged towards taking sufficient energy efficiency action during planning and review of progress. If their action falls short, pressure may increase to strengthen action at the EU level. Indeed, further legislative proposals on energy efficiency policy are due under the EGD in mid-2021. Reducing energy demand and consumption slashes greenhouse gas emissions and increases the renewable energy share. Action on energy efficiency will thus be key for the overall 2030 Framework and the 2050 climate-neutrality target, as acknowledged by the ‘energy efficiency first principle’.222222 Energy Efficiency Directive (n 18) recital 2, art 1(1); see also Governance Regulation (n 21) especially recital 64.

3.3.3 Energy Performance of Buildings Directive

While the Energy Efficiency Directive addresses the issue comprehensively across sectors, the Energy Performance of Buildings Directive (EPBD) concerns the buildings sector. The 2018 revision introduces two key amendments. First, it creates a new obligation for Member States to establish long-term renovation strategies (with milestones towards decarbonization for 2030, 2040 and 2050) to transform the building stock into ‘a highly energy efficient and decarbonised building stock by 2050’.223223 EPBD (n 24) art 2a. Second, it introduces detailed quantitative requirements concerning the installation of charging infrastructure for electric vehicles in new buildings and buildings undergoing major renovation.224224 ibid art 8. However, this outcome remained significantly below the ambition of the European Commission and will not ensure a strong growth in recharging infrastructure.225225 F Simon, ‘EU Deals Sets off Race to Renovate Europe’s Building Stock’ (EurActiv, 20 December 2017). The Directive is to be reviewed by 2026.226226 EPBD (n 24) art 19.

3.3.4 Revised rules on the EU electricity market

Four legislative instruments on the internal electricity market form part of the 2030 Framework: a recast Regulation and a recast Directive on the Electricity Market, a Regulation on Risk Preparedness, and a recast Regulation on the Agency for the Cooperation of Energy Regulators (ACER). In particular, the recast Electricity Market Regulation and Directive mark the fourth step in the development of the internal market for electricity.227227 On the history, see J Pollak, S Schubert and M Kreutler, Energy Policy of the European Union (Palgrave Macmillan 2016).

The framing of the internal electricity market is closely intertwined with the EU’s decarbonization efforts. Among others, it conditions the treatment of renewable electricity, the rights and opportunities of self-consumers, and the extent of cross-border flows. As cross-border flows are important for both enabling trade in electricity and balancing intermittent renewables, the 2030 Framework establishes a 15 percent interconnection target for 2030 (building on the 10 percent target for 2020). Our focus is on provisions in the Electricity Market Regulation and Directive that are particularly relevant for the climate transition, in particular the so-called capacity mechanisms and grid access for low-carbon electricity (especially from renewables) – while leaving out various provisions that affect the decarbonization of the electricity market less directly.

A ‘capacity mechanism’ is a temporary measure to ensure a stable supply of electricity even with increasing intermittency, in particular as a result of growing renewable electricity from wind and sun.228228 See Electricity Market Regulation (n 25) art 2(22) for definition. In practice, such mechanisms concern payments for keeping extra generation capacity (or demand management) available if needed, especially when electricity supply from renewables is low. If the extra capacity benefiting from such subsidies were to rely on coal, however, capacity mechanisms would in fact increase greenhouse gas emissions.229229 See S Whitley et al, ‘Cutting Europe’s Lifelines to Coal Subsidies’ in M Hymel et al (eds), Innovation Addressing Climate Change Challenges: Market-Based Perspectives (Edward Elgar 2018) 98. The Commission had therefore proposed to limit eligibility to participate in a capacity mechanism to generation capacity below 550 grams of carbon dioxide per kilowatt-hour230230 Commission (EU) ‘Proposal for a Directive of the European Parliament and of the Council on the promotion of the use of energy from renewable sources (recast)’ COM(2016) 767 final, 30 November 2016. to exclude coal power, but especially Member States with large shares of coal power (led by Poland) resisted. The compromise keeps the proposed emission limit, but any capacity mechanism commitments in place by the end of 2019, including those subsidizing coal power, may stay in place for up to 10 years.231231 Electricity Market Regulation (n 25) arts 21 and 22, especially arts 22(4) and 22(5) with art 21(8).

Access to the power grid for low-carbon electricity, especially from renewables, was also reviewed. Such access has been crucial for the growth of renewable electricity, as its competitiveness depends to a large extent on certainty that the electricity produced can be sold. Renewable electricity had therefore previously been granted general priority access to the electricity grid.232232 RED I (n 160) art 16(2). However, the associated costs increased with growing shares of intermittent renewables, while falling prices for wind and solar power improved their competitiveness. The new Electricity Market Regulation therefore limits priority access to installations of less than 400 kilowatts until 2026, when this limit will decrease to 200 kilowatts.233233 Electricity Market Regulation (n 25) arts 12(2) and 12(5); according to Article 12(3), Member States can further reduce the limit under strict conditions, including that they are on track to fulfilling their renewables targets under RED II. As a result, wind power and very large-scale solar power plants will be able to sell reduced shares of their electricity in times of oversupply, which should be acceptable given their other cost advantages.

The Electricity Market Directive mandates a review by the Commission by the end of 2025, while a full review of the Electricity Market Regulation is foreseen by the end of 2030.

4 CONCLUSIONS: INCREMENTALISM, PROCEDURALIZATION AND FURTHER CHANGE

Our analysis shows that the 2030 Framework primarily represents incremental rather than radical change compared with the 2020 Package. It retains the main structure of EU climate and energy law with separate targets for greenhouse gas emission reductions, renewable energy and energy efficiency. The main legal instruments – the ETS, Renewable Energy and Energy Efficiency Directives, the ESR and the electricity market rules – have been updated without fundamental changes. Some notable additions have been made to them, including the Modernization and Innovation Funds under the ETS, new flexibilities under the ESR (that soften to some extent the emission reduction obligations), reformed elements of renewable energy and energy efficiency governance, as well as the electricity market rules on capacity mechanisms. The Governance and LULUCF Regulations as the main legal innovations in the 2030 Framework also enhance rather than revolutionize the existing legal structures. The LULUCF Regulation strengthens previous accounting rules for the sector under the Kyoto Protocol, while the Governance Regulation builds on pre-existing reporting and monitoring requirements, updating, complementing and integrating them in light of the Paris Agreement.

The 2030 Framework has also further advanced the proceduralization of EU climate and energy law, especially through the LULUCF and Governance Regulations. With a focus on ‘obligations of conduct’,234234 Thus resembling the Paris Agreement. See S Oberthür and R Bodle, ‘Legal Form and Nature of the Paris Outcome’ (2017) Climate Law 40; and B Mayer, ‘Obligations of Conduct in the International Law on Climate Change: A Defence’ (2018) 27 Review of European, Comparative and International Environmental Law 130. these two Regulations have enhanced requirements for cyclical planning and reporting by the Member States. This has aligned EU climate law with best practices on regular planning for climate action in national climate laws.235235 On planning in national climate laws, Duwe et al (n 82) 24. Member States’ planning and reporting obligations are accompanied by provisions on ex ante and ex post monitoring by the Commission that can lead to country-level recommendations and/or proposals for new EU-level measures. This has arguably strengthened the means available for the Commission to advance the implementation of the renewable energy and energy efficiency objectives and to ensure that Member States properly account for emissions and removals in the LULUCF sector. At the same time, the Member States’ willingness to follow the Commission’s recommendations plays a crucial role in the effective implementation of the 2030 Framework.

We see the further proceduralization of EU climate and energy law as a fortifying complement rather than a diluting replacement of substantive ‘obligations of result’.236236 On ‘obligations of result’, see Oberthür and Bodle (n 234). Admittedly, this further proceduralization has come at the cost of the abolition of binding national renewable energy targets, also limiting recourse to infringement procedures. However, this has been balanced by the strengthening of procedural arrangements applicable to the whole 2030 Framework. Contrasting with the Paris Agreement’s virtually exclusive focus on rather general procedural obligations, the EU legal framework now combines (i) relatively detailed and precise procedural obligations with (ii) binding emission targets and other obligations of result.237237 Oberthür (n 208).

However, the 2030 Framework clearly falls short of paving the way to the radical transformation implied by the 1.5/2°C temperature goal in the Paris Agreement and calls for urgency and more radical change in climate science.238238 IPCC (n 2). We suggest that such a radical transformation requires a further strengthening of ambition and of governance, in particular: (i) a significant strengthening of the 2030 greenhouse gas emission reduction target; (ii) the firm establishment in law of a medium-term climate neutrality target; and (iii) a governance system for ensuring a credible, regularly reviewed emission trajectory toward climate neutrality and accompanying review and strengthening of measures.239239 EGD (n 5); Commission (EU) (n 45). The increased 2030 emission target would also imply a much more ambitious renewable energy target toward a renewables-dominated power and energy system by 2050 and other implementing measures. While the Commission has estimated that the perfect implementation of the 2030 targets could deliver emission reductions of 45–47 percent by 2030, projections by the European Environmental Agency cast doubts on whether such perfect implementation is underway.240240 EEA, ‘Trends and Projections’ (n 206). Moreover, even these emission reductions fall short of what is required for radical transformation. EU climate and energy law hence is in urgent need of further reforms and strengthening.

How, then, could the 2030 Framework’s incremental change become a stepping stone towards the necessary radical transformation? Several initiatives under the EGD hold promise in this respect. The European Climate Law currently under consideration could make a crucial contribution by establishing in law the climate neutrality target and upgrading the related governance system. The Commission’s proposal would, inter alia, set a trajectory for the EU’s greenhouse gas emission reductions in 2030–2050 so as to achieve climate neutrality by 2050.241241 European Climate Law Proposal (n 4) 3. Aligned with the global stocktakes under the Paris Agreement, the trajectory would be subject to review every five years.242242 ibid. Introducing a binding medium-term perspective would fill an important gap, also improving predictability and legal certainty – thereby addressing two of the three aforementioned criteria of more radically transformative EU climate and energy law. Various details of the European Climate Law proposal would benefit from further strengthening. A key missing element is an independent EU-level scientific advisory body, which, in line with national experience, could promote evidence-based policymaking243243 S Weaver et al, ‘Overview of National Climate Change Advisory Councils’ (Finnish Climate Change Panel 2019) <https://www.ilmastopaneeli.fi/wp-content/uploads/2019/05/Overview-of-national-CCCs.pdf> 14. and enhance acceptability of EU climate policy. Provisions on stakeholder engagement at the EU level should also be strengthened, taking into consideration the current weaknesses in terms of the three key rights under the Aarhus Convention on public participation, access to information and access to justice (as discussed in Section 3.1.4). Experiences under national climate laws244244 Duwe et al (n 82). should also be carefully considered in terms of whether progress toward the climate neutrality target should be ensured through intermediate targets.

In addition, the EGD foresees a Commission proposal for a more ambitious 2030 emission reduction target of 50–55 percent later in 2020 as well as proposals to revise the core implementing legislation in light of the new target in mid-2021.245245 EGD (n 5), referring to all aforementioned instruments, except the Governance Regulation that is, however, to be adapted as part of the proposal for a European Climate Law. In particular, the strengthened 2030 emission reduction target would imply a tighter cap for the ETS, more ambitious emission reductions in the effort sharing sectors, possibly going beyond the current ‘no-debit’ rule in the LULUCF sector, upgraded action on renewable energy and energy efficiency, as well as transport emissions. Eventually, all relevant measures will have to be strengthened and relevant sectoral policies aligned, including beyond the 2030 Framework analysed here. This extends to sectors such as agriculture and international aviation and maritime transport, and involves issues such as sustainable finance and the socioeconomic impacts of the climate neutrality transition.

Further action will be required beyond the initiatives of the EGD, even if and when fully implemented, to develop the EU’s climate and energy law post-2030. The EGD and in particular a strengthened 2030 emission target would create a firm basis for upgrading the EU’s first NDC, as required under the Paris Agreement,246246 UNFCCC ‘Decision 1/CP.21, Adoption of the Paris Agreement’ UN Doc FCCC/CP/2015/10/Add.1 (26 January 2016) para 24. in time for the United Nations Climate Conference that was postponed from 2020 to 2021 in the wake of the COVID-19 pandemic. Beyond that, the first global stocktake under the Paris Agreement in 2023 and the submission of the EU’s second NDC due in 2025 and extending beyond 2030 will require EU climate and energy law to be further reviewed and developed. The 2030 Framework’s provisions for the review of its core instruments – the ETS, Renewable Energy and Energy Efficiency Directives as well as the ESR, Governance and LULUCF Regulations – in 2023/2024 may be overtaken by the EGD that may have brought these reviews forward. There may hence be a need to reconsider the next steps in the development of EU climate and energy law beyond 2030 in line with the Paris Agreement. Part of this consideration is likely to be the need for negative emissions, including how to compensate for emissions that cannot be eliminated by 2050.247247 O Geden et al, ‘Targeting Carbon Dioxide Removal in the European Union’ (2019) 19 Climate Policy 487. In this respect, the Commission will propose by 2023 a regulatory framework to incentivize carbon removals through nature-based and technological solutions,248248 Commission (EU) ‘A New Circular Economy Action Plan for a Cleaner and More Competitive Europe’ (Communication) COM(2020) 98 final, 11 March 2020, 20. which, while highly relevant in light of the climate neutrality goal, raises a range of scientific, technical and political questions.249249 Geden et al (n 247).

Finally, we wish to acknowledge the still emerging impact of the COVID-19 crisis on the development of EU climate and energy law. Despite some early calls to scale back on the EU’s climate ambition,250250 E.g., by Poland and the Czech Republic: F Simon, ‘Germany, Poland Snub EU Appeal for Greater Climate Ambition’ (EurActiv, 7 May 2019). the EGD’s framing as a strategy for economic growth and innovation may help pave the way to advancing and accelerating its implementation through the recovery programmes initiated by the EU and its Member States. Thus far, measures introduced in the EU have been ambivalent as to their impact on the climate transition and the proposed EU recovery programme ‘Next Generation EU’ remains to be adopted (as of late June 2020). However, properly aligned with the EU’s climate neutrality objective, the COVID-19 recovery could also act as a catalyst of the EGD and a more radical transformation in EU climate and energy law.251251 See statement by 17 EU Climate and Environment Ministers: ‘European Green Deal Must be Central to a Resilient Recovery after Covid-19’ (Climate Home News, 9 April 2020). See also R Hodgson, ‘Climate Action can be ‘Catalyst for Recovery’ (ENDS Europe, 6 May 2020).