ENERGY FUTURES AND CLIMATE CHANGE MITIGATION: A QUALITATIVE AND QUANTITATIVE ASSESSMENT IN THE SUSTAINABLE DEVELOPMENT GOALS PERSPECTIVE

The 2030 Agenda – with its seventeen Sustainable Development Goals (SDGs) – and the Paris Agreement represent a turning point for Sustainable Development. For the first time, the world’s leaders have developed an integrated sustainable agenda and ratified a global agreement to reduce greenhouse gas emissions, recognizing that the current development model is not sustainable from an economic, social and environmental standpoint. Sustainable energy, being the driver of social and economic growth, will play a crucial role in the achievement of the 2030 Agenda objectives and for closing the gap to the mitigation targets of 2°C and 1.5°C defined by the Paris Agreement.This paper aims at showing that SDG 7 – the SDG dedicated to energy – can be considered as an enabling factor for the implementation of the other SDGs, and in particular of SDG 13, the goal on climate action.  This relation is bidirectional, meaning that mitigation of climate change is positively driven by the deployment of sustainable energy services, and that the integration of climate change mitigation strategies into national policies positively contributes to the deployment of sustainable energy solutions. The paper also shows that future energy scenarios, compatible with the above-mentioned ambitious mitigation targets, are in line with the SDG 7 Targets that can benefit from the strong technology innovation that those scenarios will require. The digitalization of the electricity sector through smart meters for demand side management and smart grids for distributed renewable generation is one example of the role of technology innovation toward SDG 7

The EU’s NDC after the Talanoa dialogue

This paper explores a number of major options that the EU could consider if the decision is made to enhance the EU Nationally Determined Contributions (NDC). It shows that the options are varied, with significant differences in terms of additional mitigation effort, political will and environmental impacts. These options have been discussed through workshops with stakeholders and policy makers and an online survey. The survey asked participants to rate the political and social acceptability, as well as competitive, international and environmental impacts of 9 options for enhancing the EU NDC set out in this paper. The results of these efforts to gather input and foster discussion are analysed at the end of the paper

Energy poverty alleviation and its consequences on climate change mitigation and African economic development

Energy access in Africa is a key policy priority, given the strict inter-relation between energy, economic growth and sustainability. The current and projected trends on Africa access to energy and electricity indicate that unless new policies are implemented, energy access in the continent will remain low, hindering Africa’s ability to transition economically. The challenges in overcoming energy poverty and in mobilizing the investment needs for a reliable and sustainable energy infrastructure are significant, but can be attained using the right energy mix. Providing energy access will not significantly exacerbate other global challenges such as climate change mitigation. Innovative financing mechanisms and policy tools can help achieve a sustainable energy transition, and the EU can play a vital role in filling the investment gaps

Carbon pricing from the origin to the European green deal

Economists have long advocated the widespread use of carbon pricing as the chief policy to combat climate change. Consensus is growing also among governments and businesses on the fundamental role of carbon pricing in the decarbonization of the economy. For governments, carbon pricing can be a source of revenue, which is particularly important in an economic environment of budgetary constraints. Businesses increasingly evaluate the impact of mandatory carbon prices on their operations and use them as a tool to identify potential climate risks and revenue opportunities. Finally, long-term investors use carbon pricing to analyze the potential impact of climate change policies on their investment portfolios, allowing them to reassess investment strategies and reallocate capital toward low-carbon or climate-resilient activities. By and large, carbon pricing takes two basic forms: a carbon tax and an emission trading system. In this chapter, we briefly review these two instruments from a conceptual standpoint. We then review the actual experience with these instruments with reference to European countries and the European Union (EU), the region where those policies have been introduced and implemented first

Increasing the ambition of the EU nationally determined contribution : lessons from a survey of experts and students

First published online: 08 August 2020The Paris Agreement targets and an increasingly large public opinion movement world-wide require to progressively raise the ambition of the Nationally Determined Contributions (NDC). The European Union (EU) could play a crucial role in this process being one of the first Parties to submit its NDC and to call for the integration of the ratchet-up mechanism for ambition in the Paris Agreement. An enhanced EU NDC, therefore, would convey a powerful signal to the other UNFCCC Parties, reinforce the credibility of EU climate policy, and confirm the EU as a global "climate leader". This paper examines whether and how the EU could enhance its NDC. For this purpose, it proposes some of the most likely and accredited options that could be pursued to achieve this goal. To dig deeper into this issue, the paper presents the results of a survey conducted among experts (scholars, practitioners, negotiators) and non-experts (students), using a mixed methods research design that combines qualitative and quantitative analyses to provide an ex-ante assessment of the selected policy options. The survey's results show that increasing the EU NDC ambition is perceived as hard but feasible by both groups of interviewees. However, the non-experts' group considers more options to be feasible showing in general a more optimistic attitude towards enhancing the EU NDC

Economic Implications of EU Mitigation Policies: Domestic and International Effects

The EU has a consolidated climate and energy regulation: it played a pioneering role by adopting a wide range of climate change policies and establishing the first regional Emission Trading Scheme (EU ETS). These policies, however, raise several concerns regarding both their environmental effectiveness and their potentially negative effect on the economy, especially in terms of growth and competitiveness. The paper reviews the European experience in order to understand if these concerns are supported by quantitative evidence. It thus focuses on key economic indicators, such as costs, competitiveness and carbon leakage as assessed by quantitative ex-ante and ex-post analyses. A dedicated section, extends the investigation to the potential extra-EU spillover of the EU mitigation policy with a particular attention to developing countries. The objective of the paper is to highlight both the limits and the opportunities of the EU regulatory framework in order to offer policy insights to emerging and developing countries that are on the way to implement climate change measures. Overall, the European experience shows that the worries about the costs and competitiveness losses induced by climate regulation are usually overestimated, especially in the long term. In addition, a tightening climate policy regime in the EU might in fact negatively impact developing countries via deteriorated trade relations. Nonetheless it tends to facilitate a resource relocation that if well governed could be beneficial to those countries where the poor are mainly involved in rural activities

The EU ETS and its companion policies : any insight for China's ETS?

This paper analyses the role that companion policies have had in the reduction of emissions regulated by the EU Emissions Trading System (EU ETS) and the related policy interactions, with a view to identifying relevant insights for China's forthcoming Emissions Trading System (ETS). The investigation rests on: (a) the observation of the EU's and China's ETSs and policy mixes; (b) economic theory concerning companion policies and ETS design; and (c) empirical ex-post evidence from the EU ETS. Three main conclusions emerge from the analysis. First, China's ETS, while not imposing a fixed cap on emissions, will not be immune to waterbed effects of companion policies. Second, the European experience stresses the importance of making explicit the objectives pursued by companion policies, and of balancing policies for innovation and policies for adoption of low-carbon technologies. Third, in the presence of a major market surplus, only permanent adjustments to allowance supply can be effective in raising prices.The work leading to this study was co-financed by the EU LIFE Programme of the European Commission – Grant Agreement LIFE15 GIC/IT/000051 LIFE SIDE. This paper reflects only the authors’ view and the Agency is not responsible for any use that may be made of the information it contains

The EU’s 2030 agenda and the Energy Union: Member States’ bargaining positions and the way forward. Egmont Commentary, 13 May 2015

The EU’s 2030 climate and energy package and the Energy Union have both the ambition to create a framework that will lead the energy sector towards decarbonisation. However, if the legislative process to implement both these legislations does not develop a framework for sharing the costs and benefits among Member States, the latter will not be able to agree on the implementation of the fundamental transition of Europe’s power system