EU Climate Policy Research Articles

Explaining transformative change in EU climate policy: multilevel problems, policies, and politics

ABSTRACT The EU's ambition to lead in global climate governance has shaped its engagement with the UNFCCC regime and informed a vast body of regulatory instruments. However, EU climate policy outcomes have not always matched aspirations. We explore how UNFCCC-EU institutional interactions have shaped EU climate policy outcomes by combining a multilevel governance perspective with scholarship on policy entrepreneurship to explain when, why, and how motivated policy entrepreneurs are most likely to secure transformative policy change. We contrast the successful policy transformation of the European Green Deal with the experience of policy stagnation in the aftermath of the economic crisis, shedding light on the interaction between problems, policies, and politics across levels. We find that while the international level is significant in opening up windows of opportunity from above, the presence below of an authoritative and motivated policy entrepreneur within the political stream is a crucial additive to securing transformative policy change.

Cost-effective reduction of fossil energy use in the European transport sector: An assessment of the Fit for 55 Package

This paper surveys climate and energy policy in the EU transport sector covering the road, aviation, and shipping sectors. We summarise current policies, focusing on the Fit for 55 Package, and link the different instruments being used (e.g. cap-and-trade, tax, mandate, performance standard, or subsidy) to different sources of market failure. Next, we analyse the static and dynamic cost-efficiency of the policies and instruments. We find that they address a range of market inefficiencies, but that there are still a number of aspects that can further improve the cost-effectiveness of current EU climate policies in the transport sector. For example, higher taxes and emission performance standards for aviation and shipping, the right combination of research and innovation investments and learning-by-doing policies, and balancing implicit carbon prices by revising the road tax system and adding congestion tolls and charges. Finally, European policy has important side effects on the rest of the world that need to be taken into account in the selection of policies. This improved set of policies can support a sustainable recovery and reach the European Union's climate targets at the lowest cost.

Comments: Upset in Energy Interdependence Rocks the World

What may have been a sense of uneasy security in countries around the world that relied on imported oil and gas has been shaken off. Russia’s invasion of Ukraine, and its role in supplying oil and natural gas to the EU, highlights just how quickly the sourcing of fuel can or must change because of the physical disruption of production, operations, and transportation, or because of sanctions or a country’s own concerns about energy security. The resultant market volatility is being felt around the world. The European Commission published plans on 8 March to cut Russian natural gas imports by two-thirds this year and end its reliance on Russian supplies “well before 2030.” About 40%, or 150–190 Bcm, of the gas supplied to the EU’s 27 countries is provided by Russia. EU Climate Policy Chief Frans Timmermans said, “The answer to this concern for our security lies in renewable energy and diversification of supply.” However, renewable energy sources are nowhere near the capacity needed to fill the supply gap and won’t be for many years to come. Diversification of supply is the most feasible alternative now. The commission said the US, Qatar, and others may be able to provide 60 Bcm of gas and LNG, equivalent to about a third of the Russian supply. Since December, US LNG exports have been heading to Europe to help refill its natural gas storage, which has been at its lowest level in at least 10 years. Storage injections in the summer were limited because of the high volume of LNG exports to Asia, high wholesale gas prices, and reduced supplies from Russia. US LNG exports in March were expected to reach about 8.84 Bcm (projection as of 16 March), exceeding a record 8.6 Bcm in January 2022. Qatar’s Energy Minister Saad al-Kaabi said in February that his country’s LNG volumes are committed in long-term contracts mostly to Asian buyers, adding that only 10–15% of the volumes may be divertible to Europe.

The durability–flexibility dialectic: the evolution of decarbonisation policies in the European Union

ABSTRACT Policy makers are under political pressure to adopt policies that achieve net-zero greenhouse gas emissions. Reaching net zero is a demanding challenge requiring durable policies that last; that is, withstand short-term turbulence. However, there is a lack of clarity in the existing literature on both the conceptual meaning of policy durability and its empirical manifestations. This paper distinguishes between three central dimensions of policy durability and uses them to shed new light on the long-term evolution of EU climate policy. It reveals that the EU has addressed the relationship between policy durability and policy flexibility by working iteratively across and between different policy elements (instruments, programmes, goals, etc.). In revealing these patterns, it addresses a greatly neglected feature of policy design processes: the dialectical relationship between durability and flexibility.

Changing European Energy Policy : The Challenge of the Energy Price Storm

This paper examines the roots of the European energy crisis within the period of 2021–2022, the reasons for the European gas shortage, the effect of the Russian invasion of Ukraine, and the potential EU responses. The current crisis is a result of several factors, starting from the Covid-19 pandemic in 2020 and amplified severely by the current conflict between Russia and Ukraine. In addition, five reasons were identified as worsening the EU energy situation. These include market-based gas prices, external dependency, global imbalances, the EU's climate policies, and low European energy stocks. The Russian invasion of Ukraine put pressure on the oil and gas supplies to the EU. This situation led the EU to introduce sanctions and measures that target increasing the share of renewable energy while reducing the dependence on Russian gas. Finally, we shed light on the energy transition as an opportunity to deal with climate change and limited energy resources while also showing the challenges that would hinder a just transition.

The obstacles and challenges of transition towards a renewable and sustainable energy system in Azerbaijan and Poland

The aims of the paper are to identify and assess the determinants of transition to renewable and sustainable energy development in Azerbaijan and Poland. Both countries have a clear target to increase the share of renewable energy sources (RES) in the gross final energy consumption, i.e. Poland in the National Energy and Climate Plan for the years 2021–2030 declares that it wishes to achieve 21–23% by 2030 (total consumption in electricity, heating and cooling as well as for transport purposes). But there are currently significant producers and consumers of conventional energy carriers, respectively coal and oil, and these fuels ensure an appropriate level of energy security and production stability. Moreover, in Poland, the mining sector plays a very important social role, whereas the oil industry in Azerbaijan creates significant budget revenue. Therefore, even with stronger EU and worldwide climate policy and a decreasing cost of cleaner forms of energy, there are many challenges and obstacles for such countries in increasing energy from RES associated with energy security, efficiency, existing infrastructure, competitiveness and social aspects. In order to identify best practices for the transition to decarbonisation, the availability of energy resources, energy market structures, national strategies and policies were compared using PESTEL analysis.

Анализ законодательных изменений и мер поддержки достижения целей Зеленой сделки

In 2019, the new European Commission (EC) presented its vision for climate and environmental transformation in Europe and beyond in its communication on the Green Deal. The Green Deal covers all sectors of the economy, elaborates a new concept for economic growth with climate goals at its centre, and implies a review of current EU climate and climate-related policies. An analysis of the instruments for the Green Deal’s implementation and internationalization and their classification and systematization shows a wider picture of the whole complex of available and suggested new policy tools. It also clarifies the role of each of the initiatives and assesses more precisely their importance and potential for influencing the global climate agenda and relations with the Russian Federation. The analysis further reveals the balance of costs and benefits for the sectors and actors involved. The purpose of this study is to systematize the complex of the Green Deal’s implementation instruments and assess the balance of various measures in the EU’s menu of policy options. The EU’s influence on the global agenda and the interests of other countries, including Russia, is not limited to the introduction of the carbon border adjustment mechanism (CBAM), which was widely covered and analyzed as a never before applied trade and climate policy tool with potential to influence global competition. Upcoming new rules to enter the European market, including through sustainable product requirements, could affect the interests of other countries even more. This influence will also be amplified by the regulatory frameworks and rules on emerging markets, such as for climate-neutral technologies and energy sources. Analysis of the initiatives suggests that the measures may be quite burdensome, especially for citizens, while the system of redistribution and compensation is not yet sufficiently developed in terms of financing and administration. Some initiatives significantly increase the transaction and administrative costs for all market participants (exporters, importers, European companies, and consumers) with fairly limited emissions reductions on a global scale. Despite these drawbacks, the Green Deal remains the most comprehensive, elaborate, detailed and ambitious initiative aimed at reaching the net-zero target. Other actors have their own reasoning for tougher climate policy, but the influence and pressure of the Deal increases the ambition of their goals and encourages them to consider the implementation of various policy options, including strict carbon regulation. Therefore, the new EU policy could become a model to identify the best solutions and practices, as well as a catalyst for global climate transition.

The Impact of Corporate Governance on the Capital Structure of Companies from the Energy Industry. The Case of Poland

The energy sector is expected to face fundamental challenges in the near future. On the one hand, it is experiencing a rapidly increasing demand for energy. At the same time, it is subject to the pressure of the climate policy due to environmental issues. For the same reason, the energy sector is forced to undertake costly investments to transform production from black to green energy. The issue of financing has become one of the key problems of the energy sector, especially in those countries in which energy production traditionally is based on fossil fuels, i.e., coal. The paper aims to investigate the impact of corporate governance on the capital structure of companies from the energy industry. We use three proxies of corporate governance quality: institutional investors, the board size, and state ownership and investigate their impact on capital structure. Our findings suggest that the latter two negatively impact debt levels. In our model, we control for financial factors and CEO personal characteristics. We use a Polish setting since transformational problems of the energy sector in Poland are especially visible. At the same time, energy companies in Poland are subject to the strict EU climate policy.

Opportunities and Threats for Polish Power Industry and for Polish Coal: A Case Study in Poland

This article analyses opportunities and threats for the Polish power industry resulting from the EU climate and energy policy. The main assumptions of the policy and directives resulting from it with regard to climate protection and the use of renewable energy sources (RES) in the production of electricity and heat are presented. The negative effects (threats) for Poland in meeting the EU requirements are discussed. The paper also discusses the opportunities for Polish coal, proposing solutions to meet EU directives and to maintain energy security without having to give up Polish coal. Reference is made as well to the plans to liquidate the Polish mining industry, indicating solutions opposing such actions.

THE SCOPE OF STATE SOVEREIGNTY UNDER ARTICLE 194(2) TFEU AND THE EVOLUTION OF EU COMPETENCES IN THE ENERGY SECTOR

AbstractThis article analyses the European Union's competences in the energy sector. It focuses on Article 194(2) of the Treaty on the Functioning of the European Union, which affords EU Member States the right to determine the conditions for exploiting their energy resources, the choice between different energy sources and the general structure of their energy supply. This article traces the constitutional development of EU competences in the energy sector to demonstrate the relevance of Article 194(2) TFEU in the current constitutional, international and sector-specific contexts of EU energy law. It analyses the recent case law of the Court of Justice of the European Union, which shows that the scope of Article 194(2) TFEU is considerably narrower in practice than its wording implies. The article concludes by evaluating the implications of this narrow interpretation on the future development of EU energy law and, in a broader context, on the reach of EU energy and climate policy.

EU Climate and Energy Policy: How Myopic Is It?

This article investigates the shortsightedness or myopia of recent climate and energy policy (CEP) in the EU. To this end, it develops and applies a measurement tool of short-termism composed of four key criteria: (1) the reflection of science-based long-term thinking in the policy process and its output; (2) the degree to which mid-term greenhouse gas emission targets and accompanying policies align with science-based long-term objectives; (3) the stringency of the legislation; and (4) its adaptability. We use these criteria to assess the levels of short-termism of the EU’s 2020 and 2030 CEP frameworks and the (still evolving) European Green Deal (EGD). Overall, we find that the level of myopia of EU CEP has fluctuated and has advanced far less than the development of the nominal mid-term emission targets might suggest. The EGD’s 55% emission reduction target for 2030 only constitutes a return to the levels of alignment with science-based long-term objectives existing in the 2020 Package (making good on the regression of the 2030 Framework). It is primarily due to the maturing of long-term thinking and a ratcheting mechanism, that EU climate policy under the EGD can be considered less myopic than the 2020 Package (although the assessment remains preliminary pending the adoption of further implementing legislation). These findings lay the ground for future research that not only investigates reasons for the general myopia of (EU) climate policy, but also the drivers of the fluctuations over time.

Transformation of coal-fired power plants on steam-gas power plants

Currently in the EU there are bigger tendencies to reduce emissions of carbon dioxide and phasing out of coal mining and combustion. There are some possibilities to transform current coal-fired power plant to steam-gas one. The advantages of steam-gas power plant are lower amount of emissions and higher efficiency unlike coal-fired one and stability of energy production unlike wind and solar one. The article focuses on principle, description and ad-vantages of steam-gas power plant. It also mentions and compares methods of transformation current coal-fired power plant to steam-gas one. Finally, the possible expansion of these power plant in the Czech Republic is discussed, with regard to economic aspects and EU cli-mate change policy.

The European Council, the Council, and the European Green Deal

We assess the response of the European Council and the Council of the European Union (hereafter the Council) to the emergence and development of the European Green Deal (EGD). First, we conduct a literature review of the historical role of the two intergovernmental institutions in EU climate policy development, drawing inspiration from new intergovernmentalism, historical institutionalism, and discursive institutionalism. Next, we provide an overview of the EGD itself and three of its core elements: (1) the ambition to achieve climate neutrality by 2050; (2) its systemic and integrative nature; and (3) the just transition approach. We then present the results of a qualitative content analysis of all Council and European Council Conclusions from 2018 to 2020. Our findings show that the European Council and the Council have declared support for the EGD and its underlying principles. The European Council engaged with all three elements but mentioned the objective of achieving net-zero emissions by 2050 most frequently and with growing intensity over the years studied. The Council similarly discussed the three elements of the EGD and gave increasing focus to the integrated/systemic transition over the course of the years 2018–2020. Our empirical analysis suggests that, on paper, the Council and the European Council may manage to govern through the organisational turbulence of member state divisions on climate governance. Furthermore, environmental turbulence arising from external contexts (e.g., economic and health crises) did not dampen their declared support towards the goals of the EGD.

Life Cycle Assessment for Supporting Dimensioning Battery Storage Systems in Micro-Grids for Residential Applications

The current EU energy and climate policy targets a significant reduction of carbon dioxide emissions in the forthcoming years. Carbon pricing, embedded in the EU emissions trading system, aims at achieving emission reductions in a more evenly spread way and at the lowest overall cost for society, compared with other environmental policy tools, such as coal or electricity taxes, or incentives such as subsidies on renewables. Still, the implementation of the decarbonization policy depends on several technical parameters such as the type, size and connectivity of the energy system as well as economic restrictions that occur. Within this paper, an optimization tool will be presented, focusing on cleaner energy production and on the control and reduction of environmental impact regarding energy storage solutions. Various types of batteries are examined and evaluated towards this direction. Emphasis is given to setting new criteria for the decision-making process, considering the size of battery storage and the selection of the battery type based on the environmental impact assessment parameter. The objective function of the system is formulated so as to evaluate, monitor and finally minimize environmental emissions, focusing mainly on carbon emissions. Optimization is carried out based on mixed integer nonlinear programming (MINLP). Two of the main battery types compared are lead–acid and lithium-ion; both of them result in results worth mentioning regarding the replacement impact (seven times during system lifetime for lead–acid) and the total environmental impact comparison (lithium-ion may reach a 60% reduction compared to lead–acid). Case studies are presented based on representative scenarios solved, which underline the importance of choosing the appropriate scope for each case and demonstrate the potential of the tool developed, as well as the possibilities for its further improvement.

What are the barriers to agricultural biomass market development? The case of Poland

This paper examines the main determinants of biomass market development from a regional perspective in the context of current EU climate and energy policy. The EU’s targeting of climate neutrality implies a new, multifaceted role for agriculture as a producer of energy resources. The challenge is to orient production to support the sustainable development of the circular economy. The possibility of using agricultural waste as a type of energy raw material aligns with a holistic approach to product management. The use of agricultural biomass as an energy raw material can enable increased energy self-sufficiency and reduced dependence on imported fuels among Poland’s regions and an increase in the country’s energy security. The aim of the study is to identify barriers to and opportunities for the development of the agricultural biomass market. The empirical section presents survey data from interviews with farm owners in the Polish province with the highest agricultural biomass potential, located in a region with one of the largest opencast mines in Europe. The estimated parameters of a logit model indicate that the logistical aspects of raw material collection and organization and a lack of knowledge of biomass are the main barriers to biomass development on the supply side.

Understanding regressivity: Challenges and opportunities of European carbon pricing

We examine how a European carbon price will affect citizens by studying its incidence on households in 23 countries of the EU. At the national level, the distributional impact before revenue recycling is mainly neutral, sometimes progressive. At an aggregate EU level, however, the impact is regressive because some low-income countries would be strongly affected by the carbon price. While national redistribution can yield a progressive EU incidence, we show that European-wide redistribution is more effective for the most affected households. We offer two indicators to offset regressive distributional effects of EU climate policy, such as the recently proposed Green Deal. The first renders the tax burden proportional; the second focuses on compensating the households most severely affected. Including both indicators in European redistribution makes for a better representation of the initial burden of carbon pricing and could increase public acceptability.

Hydrogen Strategies of the Largest European Energy Companies

The article outlines strategies of the largest European energy companies in the context of the EU climate policy aiming to accelerate the transition to a low carbon paradigm of development. For European oil and gas companies, the development of clean hydrogen projects is a natural policy since oil processing is the largest final consumer of hydrogen. Opportunities to increase production of new low-carbon energy sources are critical for European energy companies. It is concluded that hydrogen energy in Europe is developing in accordance with the algorithm previously applied in the sector of green renewable electricity. The driver of hydrogen projects is the political choice of the EU in favor of the green economy and decarbonization. Relatively high production costs allow companies to develop green hydrogen projects only relying on government support and large-scale subsidies from national and European budgets.

EU Climate Policy under the Paris Agreement

Abstract The European Union has long sought to play a leadership role in the international response to climate change. As part of the “European Green Deal”, it announced new wide-ranging plans to step up its ambition, and in December 2020 updated its mitigation target under the Paris Agreement to an at-least 55 per cent reduction by 2030 compared to the 1990 level. In this article, I provide a legal analysis of the new EU climate change policy as outlined in the European Commission’s Stepping Up Europe’s 2030 Climate Ambition (September 2020) in light of the Paris Agreement itself and other norms of international environmental law. I find that the European Union provides a degree of leadership in the implementation of the Paris Agreement, but that there are also areas of concern, in particular the missing notification of member states’ individual emission levels as part of a joint ndc under Article 4 of the Paris Agreement.

German institutional hegemony in EU sustainability policies

German hegemony is a research topic subject to significant academic attention, especially within the studies linked to European integration. The existence of German hegemony within the EU is disputed, but several studies and models demonstrate that German hegemony within the European Union is significant but at the same time not desired (therefore the designation of Germany as a reluctant or benevolent hegemon). Is this true for the EU policies linked to sustainability as well, i.e. can institutional German hegemony be identified in the related policy fields? The study aims at assessing German institutional power linked to sustainability in the European Union (narrowing down policies linked to sustainability to EU energy and climate policy). It concludes that, based on a novel power ranking model assessing Member States’ influence in the various EU institutions, German institutional power is not significant in the fields of EU energy and climate policy.

A forward calibration method for analyzing energy policy in new quantitative trade models

This article introduces a dynamic forward calibration method for New Quantitative Trade models, particularly a disaggregated Eaton and Kortum model, within a global computable general equilibrium framework. The model is parameterized based on distinct, consistent future development scenarios of the (Northwest) German energy transition with productivity growth and structural change derived through a complex scenario-creation process. The future development scenarios significantly affect European economies, particularly via the EU climate policy costs that significantly increase towards 2050. If (Northwest) Germany's energy transition fails, then its climate policy costs will increase extraordinarily. Structural change, energy efficiency improvements and nearly 100% electricity from renewables drastically reduce the costs.