European industry given renewable energy targets under RED III

The EC has welcomed a provisional agreement reached between the European Parliament and the Council to reinforce the EU Renewable Energy Directive (RED III). This EC said that the deal brings the EU one step closer to completing its ‘Fit for 55’ legislation to deliver the European Green Deal and the REPowerEU objectives. Overall, the new agreement raises the EU’s binding renewable target for 2030 to a minimum of 42.5%, up from 32% and almost doubling the existing share of renewable energy in the bloc. Negotiators also agreed that the EU would aim to reach 45% of renewables by 2030. For European risk managers and those that work for multinationals that operate in Europe, the key here is that industry is included in the latest version of RED for the first time. The agreement establishes indicative targets, as well as a binding target on industry to reach 42% of renewable hydrogen in total hydrogen consumption by 2030. The agreement also reinforces the regulatory framework for renewable energy use in transport that will see a 14.5% greenhouse gas intensity reduction or 29% share of renewable energy in final energy consumption. This includes a combined sub-target of 5.5% for advanced biofuels and renewable fuels of non-biological origin, including a minimum level of 1% for renewable fuels of non-biological origin. The EC said that these targets support the EU's ambitions on renewable hydrogen roll-out. The background to the planned acceleration is, of course, the shock caused by the energy crisis following Russia’s invasion of Ukraine and sudden realisation of the scale of Europe’s energy dependency risk. “The agreement reaffirms the EU’s determination to gain its energy independence through a faster deployment of home-grown renewable energy, and to meet the EU’s 55% greenhouse gas emissions reduction target for 2030. A massive scaling-up and speeding-up of renewable energy across power generation, industry, buildings and transport will reduce energy prices over time and decrease the EU’s dependence on imported fossil fuels,” stated the EC. One big problem raised by corporates when discussing the transition is the time taken to get projects off the ground. The EC has acted to try to solve this. “Permitting procedures will be easier and faster under the new law. Renewable energy will be recognised as an overriding public interest, while preserving a high level of environmental protection. In areas with high renewables potential and low environmental risks, member states will put in place dedicated acceleration areas for renewables, with particularly short and simple permitting processes. The provisional agreement also enhances cross-border cooperation on renewables,” explained the EC. The agreement also includes targets and measures to support the uptake of renewables across various sectors of the economy. “The revised directive strengthens annual renewables targets for the heating and cooling sector and for renewable energy used in district heating systems. It introduces a specific renewable energy benchmark of 49% for energy consumption in buildings by 2030 to complement EU buildings legislation and guide Member States’ efforts,” said the EC. The provisional agreement now requires formal adoption by the European Parliament and the Council. Once this process is completed, the new legislation will be published in the Official Journal of the Union and enter into force.

European industry given renewable energy targets under RED III

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