15 March 2019

On 20 November 2016 the European Commission promulgated its Winter Package "Clean energy for all Europeans" which aims to ensure the European Union's competitiveness on the energy markets in the transition to a more sustainable energy system. In December 2018, three new pieces of legislation were published. The aim of these instruments is to reinforce the governance of the energy union, to increase energy efficiency, and to promote renewable energy. These new pieces of legislation constitute a practical step towards the establishment of a real Energy Union.

Context

The Winter Package "Clean energy for all Europeans" is intended to achieve the European Union's objectives on energy and climate, laid down by the Paris Agreement of 2015. The Winter Package contains a total of eight new legislative initiatives that will allow the European Union to reduce CO2 emissions by 45% by 2030 compared to 1990. The Council's amendment to Directive 2010/31/EU on the energy performance of buildings, adopted on 14 May 2018, was the first step. Pursuant to that amendment, from now on Member States are obliged to establish a long-term renovation strategy and to convert public and private buildings to energy-efficient and decarbonised buildings. The reform continues with the publication on 21 December 2018 of the three instruments which entered into force on 24 December 2018: the Governance Regulation (2018/1999), the Energy Efficiency Directive (2018/2002) and the Renewable Energy Directive (2018/2001).

The Governance Regulation

The first part of this reform is laid down in the Governance Regulation (Regulation (EU) 2018/1999 of the European Parliament and the Council of 11 December 2018 on the Governance of the Energy Union and Climate Action). The Regulation sets out a political process in which the Member States and the European Commission have to cooperate, as well as arrangements for cooperation between Member States. The idea is to establish a robust system of governance that ensures convergence between national and European objectives, at the same time also allowing for a certain flexibility for adaptation to specific national circumstances and needs. Each Member State was required to establish a national energy and climate plan for the period 2021–2030 by 31 December 2018. These draft plans are currently being evaluated by the European Commission, after which will it will make recommendations. The final national plans will have to be submitted to the European Commission before 31 December 2019. These plans should cover, in a long-term perspective, the five dimensions of the European Union's strategy: energy security; research, innovation and competitiveness; the internal energy market; energy efficiency; and a decarbonised energy system. The Member States must also ensure the effective contribution of all actors (investors, citizens as well as local and regional entities) to the process. The implementation of the plans will be the subject of a biennial progress report, to be produced by the Member States under the supervision of the European Commission.

Energy Efficiency Directive

Besides the improvement of the governance system of the energy union, the European Union also reconfirmed its commitment to ensuring reinforcement of energy efficiency. In 2016 the EU announced that it aimed to increase energy efficiency by 20% by 2020. The modified Energy Efficiency Directive (Directive (EU) 2018/2002 of the European Parliament and of the Council of 11 December 2018 amending Directive 2012/27/EU on energy efficiency) introduces a new energy efficiency objective for the Member States: energy efficiency within the European Union should increase by at least 32.5% by 2030. At the same time, a review clause allows this objective to be revised upwards as of 2023. Besides these ambitions, the Directive also reinforces the rules relating to metering of individual energy consumption and invoicing of thermal energy by clarifying that energy consumers in multi-apartment or multi-purpose buildings have the right to receive  information about their energy consumption on a more regular basis. Moreover, the Member States are obliged to draw up transparent standards which are accessible to the public relating to the distribution of costs with regard to heating, cooling and consumption of domestic hot water in such buildings. The Member States must adopt all necessary modifications related to the transposition of the Directive by 25 June 2020.

Renewable Energy Directive

The Renewable Energy Directive (Directive (EU) 2018/2001 of the European Parliament and of the Council of 11 December 2018 on the promotion of the use of energy from renewable sources) also implements a binding objective relating to energy: by 2030, 32% of all energy produced within the European Union must be produced from renewable sources. Furthermore, fuel suppliers must supply a minimum of 14% of the energy consumed in transport by 2030 in the form of renewable energy. Biofuel, bioliquid and biomass fuel produced from feedstock that has high indirect land-use change risk and for which there is significant expansion of the production into land with high-carbon stock will progressively be put aside by 2030. Additionally, the European Union is striving to facilitate the procedures for investors by reducing administrative burdens and associated costs. It also aims to strengthen renewable energy production through a cost-effective and market-based support scheme. Finally, the Directive also provides a regulatory framework for self-consumption. The Member States must adopt all necessary modifications related to the transposition of the Directive by 30 June 2021 at the latest.

And now?

These three legislative instruments entered into force on 24 December 2018. The Energy Efficiency Directive and the Renewable Energy Directive must be transposed by the Member States at the latest by 25 June 2020 and 30 June 2021 respectively. Their implementation into Belgian law should be closely monitored. However, even at EU level, the legislative work is not yet complete. In December 2018, a political agreement was reached on the four other instruments of the Winter Package: the Electricity Directive, the Electricity Regulation, the Regulation for the Agency for the Cooperation of Energy Regulators, and the Risk-Preparedness Regulation. These instruments put consumers at the heart of the energy transition by ensuring they will have an increased level of protection and are to be adopted by the European Parliament and the Council in the short term.