The European Commission has unveiled the REPowerEU Plan, which aims to end the EU's dependence on Russian fossil fuels and tackle the climate crisis. To do so, the executive branch of the EU proposes to enhance long-term energy efficiency measures, including an increase from 9% to 13% of the binding Energy Efficiency Target under the ‘Fit for 55' package of European Green Deal legislation. In addition, the Commission aims to diversify energy supplies, including through the creation of the EU Energy Platform, that would enable voluntary common purchases of gas, LNG and hydrogen.
The Commission also aims to increase the headline 2030 target for renewables from 40% to 45% under the Fit for 55 package, with a dedicated EU Solar Strategy to double solar photovoltaic capacity by 2025, instal 600 GW by 2030 and make mandatory the installation of solar panels on new public, commercial and residential buildings. Permitting processes for major renewable projects should be shortened and simplified and dedicated ‘go-to' areas for renewables should be put in place by Member States. The Commission also sets a target of 10 Mt of domestic renewable hydrogen production and 10 Mt of imports by 2030 to replace gas, coal and oil in hard-to-decarbonise industries and transport sectors; a "carbon contract for difference" scheme will be rolled out to support green hydrogen in industry and transport, which could save up to 35 bcm of gas by 2035 by switching to renewable hydrogen, biogas and biomethane. For transport, a legislative initiative is under consideration to increase the share of zero emission vehicles in public and corporate car fleets above a certain size.
To support the new strategy, which requires an additional investment of €210bn between 2022 and 2027, €225bn is already available in loans under the Recovery and Resilience Facility (RRF). In addition, the Commission proposes to increase the RRF financial envelope with €20bn in grants from the sale of EU Emission Trading System allowances currently held in the Market Stability Reserve, to be auctioned in a way that does not disrupt the market. Reducing Russian fossil fuel imports is expected to save the EU almost €100bn per year.
The European Green Deal is the EU's long-term plan to make the regional bloc climate neutral by 2050. This target is enshrined in the European Climate Law, as well as the legally binding commitment to reduce net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels. The Commission presented its Fit for 55 package of legislation in July 2021 to implement these targets.
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