EU to mull 90pc GHG emissions cut by 2040

  • Market: Battery materials, Biofuels, Biomass, Coal, Crude oil, E-fuels, Electricity, Emissions, Hydrogen, Natural gas, Oil products
  • 06/02/24

The European Commission today presented policy documents confirming its preference for a 90pc net greenhouse gas (GHG) emissions reduction by 2040 for the bloc, compared with 1990 levels.

Excluding emissions from agriculture and forestry sectors, the commission calculates that net GHG cuts of 90pc would leave remaining EU GHG emissions in 2040 of under 850mn t/CO2 equivalent (CO2e), with carbon removals reaching up to 400mn t/CO2. Removals would include both "land-based and industrial carbon removals", according to the documents. The commission's industrial carbon management strategy, released today, sets out the need for 280mn t/yr of CO2 storage capacity by 2040 for the EU.

The commission's carefully worded target refers to a "net GHG emissions reduction of 90pc". To secure a majority in October's European parliament nomination vote, climate commissioner Wopke Hoekstra had made a "personal" commitment to defend a "minimum target of at least 90pc" net GHG cuts. The objective of the communication and impact assessment is to launch the political debate on post-2030 legislation, rather than to propose new policy measures or set new sector-specific targets, officials said.

Electrification with a fully decarbonised power system by 2040 is portrayed as the main driver of energy transition. The commission calculates that the share of power in final energy consumption would double from 25pc today to 50pc in 2040. Officials project the shares of battery-electric and other zero-emission vehicles will rise to over 60pc for cars, over 40pc for vans and almost 40pc for heavy-duty vehicles by 2040.

The documents set out cost estimates for the transition, which amount to "close to €660bn ($709bn) per annum on average" over 2031-50 for energy system investment — equivalent to 3.2pc of gross domestic product (GDP). This is compared with investment of €250bn/yr over 2011-20, although that was "a decade with relatively low investments in the energy system", the commission noted. The documents suggest annual spending on transport would be around €870bn, equivalent to 4.2pc of GDP, which is a similar proportion to transport spend in 2011-20. Progress on the circular economy could cut costs, the commission added.

The commission's preferred option of cutting GHG emissions by 90-95pc by 2040, set out in an impact assessment, previously leaked, sets a "clear transition path away from fossil fuels". The commission calculates that 2040 consumption of fossil fuels for energy would decrease by 80pc compared with 2021 — updating a possible error in the leaked documents, which mentioned a baseline year of 1990. Coal would be "phased out" with road, maritime and oil consumption representing 60pc of remaining energy use of fossil fuels.

Policies should ensure that "any remaining fossil fuel combustion will be coupled as soon as possible with carbon capture [utilisation] and storage", following the commitment made in December at the UN Cop 28 climate summit on "transitioning away" from fossil fuels, the commission said. The gas market would change with an increasing role for low-carbon and renewable liquid fuels and gases, it added.

But the documents give no clear date on a fossil fuel phase out. "This is about as meaningful as a target to prevent lung cancer without any plan to end smoking," Greenpeace EU climate campaigner Silvia Pastorelli said, pointing to the lack of a specific target date to phase out coal, oil and gas, or fossil-fuel subsidies.


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