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National Energy and Climate Plans
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National Energy and Climate Plans

The National Energy and Climate Plans (NECPs) were introduced by the Regulation on the governance of the energy union and climate action (EU)2018/1999, agreed as part of the Clean energy for all Europeans package which was adopted in 2019.

The NECPs outline how the EU countries intend to address the 5 dimensions of the energy union:

  • decarbonisation
  • energy efficiency
  • energy security
  • internal energy market
  • research, innovation and competitiveness

This approach requires a coordination of purpose across all government departments and it provides a level of planning that will ease public and private investment.

EU countries’ 10-year national energy and climate plans for 2021-2030.

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Renewable Energy
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Renewable Energy

The Renewable Energy Directive is the legal framework for the development of renewable energy across all sectors of the EU economy, and supports cooperation across EU countries.

Since the introduction of the Renewable Energy Directive (2009/28/EC) in 2009, the deployment of renewables has kept growing yearly, reaching 21.8% of energy consumed in the EU in 2021.

The Renewable Energy Directive was revised in 2018. The Renewable Energy Directive (2018/2001/EU)entered into force in December 2018, as part of the Clean energy for all Europeans package, aimed at keeping the EU as a global leader in renewables and, more broadly, helping it to meet its emissions reduction commitments under the Paris Agreement.

The directive establishes a new binding renewable energy target for the EU for 2030 of at least 32%, witha clause for a possible upwards revision by 2023. This target is a continuation of the 20% target for 2020.

It introduces new measures for various sectors of the economy, particularly on heating and cooling and transport, where progress has been slower (for example, an increased 14% target for the share of renewable fuels in transport by 2030). It also includes new provisions to enable citizens to play an active role in the development of renewables by enabling renewable energy communities and self-consumption of renewable energy. It also establishes strengthened criteria to ensure bioenergy’s sustainability.

In July 2021, the Commission proposed another revision to accelerate the take-up of renewables in the EU and to help reaching the 2030 energy and climate objectives. The directive sets a common target – currently 32% – for the amount of renewable energy in the EU’s energy consumption by 2030. The proposed revision and the REPowerEU plan, presented in May 2022, suggest further evolution of the target to accelerate the take-up of renewables in the EU, including by speeding up the permitting processes for the deployment of renewables.

The ambition and measures in the Renewable Energy Directive have been reviewed several times in order to deliver the urgent emission cuts (at least 55% by 2030) that are required to achieve the EU’s increased climate ambitions. In July 2021, the Commission proposed a revision of the directive with an increased 40% target as part of the package to deliver on the European Green Deal. In May 2022, the Commission proposed in its Communication on the REPowerEU plan to further increase this target to 45% by 2030.

The revision of the Directive also introduces new measures to complement the already existing building blocks established by the 2009 and 2018 directives to ensure that all potentials for the development of renewable energy are optimally exploited, which is a necessary condition to achieve the EU’s objective of climate neutrality by 2050. These include notably strengthened measures to support renewables uptake in transport, heating and cooling, seeking to convert into EU law some of the concepts outlined in the energy system integration and hydrogen strategies, published in 2020. These concepts aim at creating an energy efficient and circular energy system based on renewable energy that facilitates renewables-based electrification and promotes the use of renewable and low-carbon fuels, including hydrogen, in sectors where electrification is not yet a feasible option, such as transport.

National renewable energy action plans 2020

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EU policies and regulations
Ecodesign
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Ecodesign

The ecodesign requirements for individual product groups are created under the EU’s ecodesign directive. The EU legislation on ecodesign applies to 31 of the product groups

As an alternative, industry sectors may also sign voluntary agreements to reduce the energy consumption of their products. The Commission formally recognises such agreements and monitors their implementation. 

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Energy Labelling
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Energy Labelling

The energy labelling requirements for individual product groups are created under the EU’s energy labelling framework regulation. 15 of the product groups require an energy label. The list is available in this link.

 

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Energy Efficiency of Buildings
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Energy Efficiency of Buildings

To boost energy performance of buildings, the EU has established a legislative framework that includes the Energy Performance of Buildings Directive (2010/31/EU) (hereafter referred as EPBD) and the Energy Efficiency Directive (2012/27/EU).

Together, these directives promote policies that will help

  • achieve a highly energy efficient and decarbonised building stock by 2050
  • create a stable environment for investment decisions
  • enable consumers and businesses to make more informed choices to save energy and money.

Both directives were amended in 2018 and 2019, as part of the Clean energy for all Europeans package.

The Directive amending the Energy Performance of Buildings Directive (2018/844/EU) introduced new elements and sent a strong political signal on the EU’s commitment to modernise the buildings sector in light of technological improvements and to increase building renovations.

In October 2020, the Commission presented its Renovation wave strategy, as part of the European Green Deal. It contains an action plan with concrete regulatory, financing and enabling measures to boost building renovation. Its objective is to at least double the annual energy renovation rate of buildings by 2030and to foster deep renovation. A revision of the Energy Performance of Buildings Directive is one of its key initiatives.

In December 2021, the Commission proposed a revision of the directive. It upgrades the existing regulatory framework to reflect higher ambitions and more pressing needs in climate and social action, while providing EU countries with the flexibility needed to take into account the differences in the building stock across Europe.

It also sets out how Europe can achieve a zero-emission and fully decarbonised building stock by 2050. The proposed measures will increase the rate of renovation, particularly for the worst-performing buildings in each country. The revised directive will modernise the building stock, making it more resilient and accessible. It will also support better air quality, the digitalisation of energy systems for buildings and the roll-out of infrastructure for sustainable mobility. Crucially, the revised directive facilitates more targeted financing to investments in the building sector, complementing other EU instruments supporting vulnerable consumers and fighting energy poverty.

The main measures in the new proposal are:

  • the gradual introduction of minimum energy performance standards (MEPS) to trigger renovation of the worst performing buildings
  • a new standard for new buildings and a more ambitious vision for buildings to be zero-emission
  • enhanced long-term renovation strategies, to be renamed National Building Renovation Plans
  • increased reliability, quality and digitalisation of Energy Performance Certificates; with energy performance classes to be based on common criteria
  • a definition of deep renovation and the introduction of building renovation passports
  • modernisation of buildings and their systems, and better energy system integration (for heating, cooling, ventilation, charging of electric vehicles, renewable energy).

The proposed revision of the directive is now being considered by the Council and the European Parliament.

All EU countries must establish a long-term renovation strategy to support the renovation of their national building stock into a highly energy efficient and decarbonised building stock by 2050. The requirement for EU countries to adopt a long-term renovation strategy is set out in the Energy Performance of Buildings Directive (2010/31/EU), which was revised in 2018 (2018/844/EU). These strategies are part of EU countries’ integrated National Energy and Climate Plans (NECPs).

National Long-Term Building Renovation Strategies

The long-term renovation strategies must include an overview of the national building stock policies and actions to stimulate a cost-effective deep renovation of buildings and target the worst performing buildings, split-incentive dilemmas, market failures, energy poverty and public buildings. An overview of national initiatives to promote smart technologies and skills and education in the construction and EE sectors is also a key part of these strategies.

The strategies must also include a roadmap with measures and measurable progress indicators, as well as indicative milestones for 2030, 2040 and 2050. They also need to contain an estimate of the expected energy savings and wider benefits and the contribution of the renovation of buildings to the Union’s energy efficiency target.

A solid financial component is key to underpin long-term renovation strategies, particularly through an effective use of public funding, aggregation and de-risking.

National Building Renovation Plans

In December 2021, the Commission proposed to review the current framework within the revision of the EPBD and suggests to strengthen the long-term renovation strategies towards ‘Building renovation plans’. These national plans should be submitted every 5 years, following the submission of a draft plan, and should have clear and specific chapters, based on a common template. The plans will include national targets(instead of indicative milestones) in a more unified and comparable approach, an outline of the investment needs for their implementation and an overview of policies and measures.

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Energy Efficiency
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Energy Efficiency

To meet the 2030 climate target, energy efficiency needs to be prioritised. To step up its efforts, the Commission put forward in July 2021 a proposal for a recast directive on energy efficiency as part of the package “Delivering on the European Green Deal”. The proposal promotes energy efficiency first’ as an overall principle of EU energy policy and marks its importance and relevance in both its practical applications in policy and investment decisions.

The recast proposal raises the level of ambition of the EU energy efficiency target and makes it binding by requiring EU countries to collectively ensure an additional reduction of energy consumption of 9% by 2030 compared to the 2020 reference scenario projections. This 9% additional effort is measured against updated baseline projections made in 2020 and corresponds to the 39% and 36% energy efficiency targets for primary and final energy consumption respectively.

In the REPowerEU plan, presented in May 2022, the Commission proposed to raise the ambition further to reduce the EU’s reliance on fossil fuel imports from Russia. Because saving and reducing energy is the cheapest, safest and cleanest way to do so, it proposed to increase the binding EU energy efficiency target from 9% to 13%, compared to the 2020 Reference Scenario.

The recast proposal:

  • nearly doubles the annual energy savings obligation, which is one of the key policy instruments of the Energy Efficiency Directive to meet the headline target. EU countries must achieve new savings each year of 1.5% of final energy consumption from 2024 to 2030, up from the current level of 0.8%.
  • introduces a specific requirement for the public sector to achieve an annual energy consumption reduction of 1.7% as part of the objective to enhance the exemplary role of public sector across wide range of activities like buildings, transport, water and street lighting.
  • requires to renovate each year at least 3% of the total floor area of buildings owned by all levels of public administration. Public bodies will also need to systematically take into account energy efficiency requirements in their public procurement of products, services, buildings and works.
  • stronger focus on alleviating energy poverty and empowering consumers, through strengthened requirements on awareness raising and information provision, including on creation of one-stop-shops, technical and financial advice or assistance, consumer protection via out-of-court mechanisms for the settlement of disputes are structures. Improved requirements to identify and lift barriers relevant to the split incentives between tenants and owners or among owners are also included.
  • focus on implementation of an energy management system as a default obligation for large energy consumers, and changing the scope of application of energy audits obligation from small and medium-sized enterprise (SME) definition to energy consumption.
  • Revised definitions of efficient district heating and cooling and efficient cogeneration to ensure fully decarbonised heat or cooling supply in efficient district heating or cooling systems by 2050.
  • In addition, clearer and stricter requirements to ensure the necessary technical competence for energy services providers, energy auditors, energy managers and installers (via regular assessment of the effectiveness of the schemes and ensuring that they correspond to the market needs). Improved interlinkage with Article 24 (on energy services) on ensuring quality of energy services.
  • Requirement for all large (above 1000m2) non-residential buildings subject to renovation to assess the feasibility to carry out renovation via energy performance contracts. Strengthening of the role of intermediaries (one-stop-shops and facilitators) to support the uptake of energy performance contracting.
  • Requirement for EU countries to report on energy efficiency investments including on energy performance contracts concluded (as part of Governance Regulation). EU countries will be required to set up project development assistance mechanisms at national, regional and local levels to promote energy efficiency investments to help reaching the higher energy efficiency targets.

In 2018, as part of the “Clean energy for all Europeans package”, the amending Directive on Energy Efficiency (2018/2002) was agreed to update the policy framework to 2030 and beyond. Its key element is a headline energy efficiency target for 2030 of at least 32.5%. The target, to be achieved collectively across the EU.

The amending directive also includes an extension to the energy savings obligation in end use, introduced in the 2012 directive. Under the amending directive, EU countries will have to achieve new energy savings of 0.8% each year of final energy consumption for the 2021-2030 period.

Other elements in the amended directive include:

  • stronger rules on metering and billing of thermal energy by giving consumers – especially those in multi-apartment building with collective heating systems – clearer rights to receive more frequent and more useful information on their energy consumption, also enabling them to better understand and control their heating bills
  • requiring EU countries to have in place transparent, publicly available national rules on the allocation of the cost of heating, cooling and hot water consumption in multi-apartment and multi-purpose buildings with collective systems for such services
  • monitoring efficiency levels in new energy generation capacities
  • updated primary energy factor (PEF) for electricity generation of 2.1 (down from the current 2.5)
  • a general review of the Energy Efficiency Directive (required by 2024)

Directive on Energy Efficiency 2012/27/EU established a set of binding measures to help the EU reach its 20% energy efficiency target by 2020. In the context of the Energy Efficiency Directive, a number of important measures have been adopted throughout the EU to improve energy efficiency in Europe, including

  • policy measures to achieve energy savings equivalent to annual reduction of 1.5% in national energy sales
  • EU countries making energy efficient renovations to at least 3% per year of buildings owned and occupied by central governments
  • national long-term renovation strategies for the building stock in each EU country
  • mandatory energy efficiency certificates accompanying the sale and rental of buildings
  • the preparation of national energy efficiency action plans (NEEAPs) every three years
  • minimum energy efficiency standards and labelling for a variety of products such as boilers, household appliances, lighting and televisions (energy label and ecodesign)
  • the planned rollout of close to 200 million smart meters for electricity and 45 million for gas by 2020
  • obligation schemes for energy companies to achieve yearly energy savings of 1.5% of annual sales to final consumers
  • large companies conducting energy audits at least every four years
  • protecting the rights of consumers to receive easy and free access to data on real-time and historical energy consumption.

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EU policies and regulations
Renovation Wave
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Renovation Wave

Renovating both public and private buildings is an essential action and has been singled out in the European Green Deal as a key initiative to drive EE in the sector and deliver on objectives.

To pursue this dual ambition of energy gains and economic growth, in 2020, the Commission published the strategy “A Renovation Wave for Europe – Greening our buildings, creating jobs, improving lives” to boost renovation in the EU. It aims to double annual energy renovation rates in the next 10 years. Along with reducing emissions, these renovations will also enhance quality of life for people living in and using the buildings, and should create many additional green jobs in the construction sector.

The Renovation Wave identifies 3 focus areas:

  • tackling energy poverty and worst-performing buildings
  • public buildings and social infrastructure
  • decarbonising heating and cooling

The Renovation Wave initiative builds on:

  • the national Long-term Building Renovation Strategy
  • other aspects of the Directive on Energy Performance of Buildings
  • and building-related aspects of each EU country’s National Energy and Climate Plans (NECPs)

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REPowerEU
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REPowerEU

In response to the hardships and global energy market disruption caused by Russia’s invasion of Ukraine, the European Commission presented the REPowerEU Plan. REPowerEU is the European Commission’s plan to make Europe independent from Russian fossil fuels well before 2030

REPowerEU is a plan for

  • saving energy
  • producing clean energy
  • diversifying energy supplies

 

Clean energy

Renewables are the cheapest and cleanest energy available, and can be generated domestically, reducing EU’s need for energy imports. The Commission is proposing to increase the EU’s 2030 target for renewables from the current 40% to 45%. The REPowerEU Plan would bring the total RE generation capacities to 1,236 GW by 2030, in comparison to the 1,067 GW by 2030, envisaged under Fit for 55 for 2030.

The EU Solar Energy Strategy will boost the roll-out of photovoltaic (PV) energy. As part of the REPowerEU plan, this strategy aims to bring online over 320 GW of solar PV newly installed by 2025, and almost 600 GW by 2030. These frontloaded additional capacities displace the consumption of 9 billion m3 (bcm)of natural gas annually by 2027.

 

Clean industry

Replacing coal, oil and gas in industrial processes will help cut the dependency on Russian fossil fuels, while transitioning to cleaner energy sources, strengthening industrial competitiveness and supporting international technology leadership.

  • Electrification, EE and uptake of renewables could allow industry to save 35 bcm of natural gas by 2030 beyond Fit for 55 targets
  • Largest reductions in gas, almost 22 bcm, could be made from non-metallic minerals, cement, glass and ceramics, chemicals production and refineries
  • Around 30% of EU primary steel production is expected to be decarbonized on the basis of renewable hydrogen by 2030

 

Saving energy

Saving energy is the cheapest, safest and cleanest way to reduce reliance on fossil fuel imports from Russia. Together with EE measures, EU’s individual actions will have a positive impact on prices – directly reducing energy bills, making economy more resilient and accelerating EU’s clean energy transition.

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Fit for 55
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The Fit for 55 package is a set of proposals to revise and update EU legislation and to put in place new initiatives with the aim of ensuring that EU policies are into line with the climate goals agreed by the Council and the European Parliament. It refers to the EU’s target of reducing net greenhouse gas emissions by at least 55% by 2030​. The proposed package aims to bring EU legislation in line with the 2030 goal.

The package of proposals aims at providing a coherent and balanced framework for reaching the EU’s climate objectives, which:

  • ensures a just and socially fair transition
  • maintains and strengthens innovation and competitiveness of EU industry while ensuring a level playing field vis-à-vis third country economic operators
  • underpins the EU’s position as leading the way in the global fight against climate change.

On 25 July 2023, the EU has officially concluded the inter-institutional negotiations on the enhanced legal framework for energy efficiency. The Council’s endorsement follows the one given by the European Parliament earlier this month and marks the final step in the legislative process that started in July 2021 as part of the ‘Fit for 55’ package. By recasting the Energy Efficiency Directive, the EU is moving one step closer to achieving its climate goals, making an unwavering commitment to becoming climate-neutral by 2050.

The ‘Fit for 55’ package is setting a legally binding target of 11.7% reduction in final energy consumption by 2030 compared to the 2020 reference year, the updated legislation introduces a series of measures to help accelerate energy efficiency practices. Notably, EU countries will now be legally required to prioritise energy efficiency in policymaking, planning, and major investments, giving the “energy efficiency first principle” substantial legal standing for the first time.

Moreover, the EU countries agreed to almost double their annual energy savings obligation in the coming years. Under the recast Directive, EU countries will be required to achieve an average annual energy savings rate of 1.49% from 2024 to 2030, up from the current requirement of 0.8%, driving energy savings in critical sectors like buildings, industry, and transport.

With the definition of energy poverty included in the legislation, EU countries are compelled to prioritise energy efficiency improvements for vulnerable customers, low-income households, and individuals in social housing, including within the scope of the energy savings obligation.

The recast directive further strengthens the exemplary role to be played by the public sector in enhancing energy efficiency practices. A significant advancement is the introduction of an annual energy consumption reduction target of 1.9% for the public sector as a whole. Moreover, the annual 3% buildings renovation obligation is being extended to all levels of public administration. The public sector will also play a driving role in the development of the energy services market. Energy Performance Contracts will be prioritised in the implementation of energy efficiency projects in the public sector, whenever possible. Public bodies will continue to consider energy efficiency requirements when making decisions regarding the purchase of products, buildings, and services, fostering systematic improvements.

Businesses operating in the EU will be able to benefit from assessments of their energy use practices, with energy management systems becoming a default requirement for large energy consumers exceeding 85 TJ of annual energy consumption and will be subject to mandatory audits in the event of non-compliance. Enterprises with an energy consumption above 10 TJ will have to perform an energy audit and prepare an action plan for the different recommendations. The agreement also introduces a reporting scheme of energy performance in large data centres, promoting transparency and optimisation of energy efficiency potential.

Given the importance of digitalisation and data centres, the directive introduces an obligation for the monitoring of the energy performance of data centres. An EU-level database will collect and publish data, which is relevant for the energy performance and water footprint of data centres with significant energy consumption.

The new legislation also promotes local heating and cooling plans in larger municipalities. Moreover, based on the revised definition of efficient district heating and cooling included in the legislation, minimum requirements will be gradually tightened in the coming years towards achieving a fully decarbonised district heating and cooling supply by 2050.

Equipping the workforce with relevant skills will also be key to the successful achievement of the enhanced targets.  EU countries will therefore need to ensure that certification and qualification opportunities are available for energy efficiency-related professions.

The agreement further supports energy efficiency financing provisions to facilitate investments, including from the private sector, which has a key role to play given the limited public resources available for the clean energy transition. EU countries are tasked with promoting innovative financing schemes and green lending products, ensuring wider access through transparent investment. Enhanced reporting on energy efficiency investments will improve accountability and transparency.

The amending directive will entering into force after publication (September) in the EU Official Journal.

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European Green Deal
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European Green Deal

The European Green Deal is the EU’s long-term growth strategy to make Europe climate-neutral by 2050. The European Commission has adopted a set of proposals to make the EU’s climate, energy, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels.

The European Green Deal will transform the EU into a modern, resource-efficient and competitive economy, ensuring:

  • no net emissions of greenhouse gases (GHG) by 2050
  • economic growth decoupled from resource use
  • no person and no place left behind

This will create new opportunities for innovation and investment and jobs, as well as:

  • reduce emissions
  • create jobs and growth
  • address energy poverty
  • reduce external energy dependency
  • improve health and wellbeing

The benefits of the European Green Deal:

  • fresh air, clean water, healthy soil and biodiversity
  • renovated, energy efficient buildings
  • healthy and affordable food
  • more public transport
  • cleaner energy and cutting-edge clean technological innovation
  • longer lasting products that can be repaired, recycled and re-used
  • future-proof jobs and skills training for the transition
  • globally competitive and resilient industry

Energy and the Green Deal

The production and use of energy account for more than 75% of the EU’s GHG emissions. Decarbonising the EU’s energy system is therefore critical to reach 2030 climate objectives and the EU’s long-term strategy of achieving carbon neutrality by 2050.

The European Green Deal focuses on 3 key principles for the clean energy transition, which will help reduce GHG emissions and enhance the quality of life of citizens:

  1. ensuring a secure and affordable EU energy supply
  2. developing a fully integrated, interconnected and digitalised EU energy market
  3. prioritising energy efficiency (EE), improving the energy performance of buildings and developing a power sector based largely on renewable energy sources (RES)

The main objectives to achieve this are:

  • build interconnected energy systems and better integrated grids to support RES
  • promote innovative technologies and modern infrastructure
  • boost EE and eco-design of products
  • decarbonise the gas sector and promote smart integration across sectors
  • empower consumers and help EU countries to tackle energy poverty
  • promote EU energy standards and technologies at global level
  • develop the full potential of Europe’s offshore wind energy

Cleaning energy sector

Reducing GHG emissions by at least 55% by 2030 requires higher shares of RE and greater EE.

  • The Commission proposes to increase the binding target of RES in the EU’s energy mix to 40%. The proposals promote the uptake of renewable fuels, such as hydrogen in industry and transport, with additional targets.
  • In addition, reducing energy consumption is essential to bring down both emissions and energy costs for consumers and industry. The Commission proposes to increase EE targets at EU level and make them binding, to achieve by 2030 an overall reduction of 36-39% for final and primary energy consumption.

The tax system for energy products must also support the green transition by giving the right incentives. The Commission proposes to align the minimum tax rates for heating and transport with climate objectives, while mitigating the social impact and supporting vulnerable citizens.

Renovating buildings for greener lifestyle

Renovating homes and buildings will save energy, protect against extremes of heat or cold and tackle energy poverty.

The Commission proposes to:

  • require Member States to renovate at least 3% of the total floor area of all public buildings annually
  • set a benchmark of 49% of renewables in buildings by 2030
  • require Member States to increase the use of RE in heating and cooling by +1.1% each year, until 2030.