Statement by Agora Energiewende on part two of the Fit for 55 package

Matthias Buck, Director of European Energy Policy at think-tank Agora Energiewende:

“We only have this decade left to take meaningful climate action. The proposals presented today need to be significantly strengthened in the legislative process. They need to protect citizens from escalating costs of an inflated gas system and ensure that future investments are in line with our net-zero target. It is positive news that regulators, grid planners and System Operators will be obliged to prepare for the phase-down to climate neutrality. But the need to rapidly phase down fossil gas use in Europe and replace fossil molecules mainly with electricity must become the underlying narrative of the Gas Directive and the Gas Regulation. Thus, the definition of low carbon hydrogen should set a greenhouse gas emission reduction threshold of 80 percent and the support given to decisions of Member States to blend hydrogen into their national gas systems should be rejected.”

The Commission also proposes a new Methane Leakage Regulation.  “We welcome that for the first time the European Union is regulating methane emissions, with a focus on monitoring, reporting and fixing the biggest leaks. It is however not enough to put the oil and gas industry on a net zero path. Member States need to be given a national reduction target for methane emissions and maximum leakages rates should also be applied to imports that are responsible for the bulk of emissions”, Matthias Buck says.

The European Commission also addresses the building sector with the revamp of its Energy Performance of Buildings Directive (EPBD) in a bid to align the building standards for new construction and renovation with the goal of climate-neutrality by 2050.

“The EPBD revision takes an important step in the right direction by proposing a new zero-emissions buildings framework and aligning tools with this goal. To drive investments into the building stock at the scale and depth needed by 2030 and keep ETS 2 allowance prices in check, we need more ambitious minimum energy performance standards”, Matthias Buck says.

Noting that the European Commission wants Member States to measure embedded carbon in new buildings under the new performance of the EPBD, Matthias Buck adds that measurement is good, but what is really needed is regulatory limits. “That’s what will really create markets for low-carbon basic materials.”