European Commission to Release New Energy Policy in July including tighter Energy Regulations

Tighter energy regulations and policy changes are likely to impact sectors where sustainability uptake has been low, such as transport and industry. It remains to be seen how binding the policy changes will be on industries across the EU.

Kadri Simson, European Commissioner for Energy on the left and Stella Kyriakides, European Commissioner for Health and Food Safety, on the right, Credit: Xavier Lejeune for the European Union, 2021

Kadri Simson, European Commissioner for Energy on the left and Stella Kyriakides, European Commissioner for Health and Food Safety, on the right, Credit: Xavier Lejeune for the European Union, 2021

The European Commission is expected to release its much-anticipated policy document on 12 areas of climate change in July this year. The revamped climate change policies are designed to cut greenhouse gas emissions faster. One of the areas where the EU is focusing its efforts is a change in energy regulations. Kadri Simson, the Energy Commissioner of the EU stated that promoting power purchase agreements in renewable energy and pushing sectors to integrate cleaner sources of energy such as wind, solar or bioenergy will be a focal point of the policies.

She commented on the upcoming event: “The pace of renewables uptake is not where it should be, so we are looking at setting an indicative target for renewables in this sector.” Simson was referring to transport and industry, where uptake of renewable sources of energy has been particularly slow. Other proposals could include labels for industrial products made using renewables. An example of this could be to commercially identify steel produced in furnaces powered by renewable electricity.

Currently, industries are not bound to the European Union’s policies on renewable energy. Targets indicated by the new energy regulation policies may not be binding on manufacturing companies. In addition to this, various industry sectors vary widely in their adoption of renewable sources of energy. For example, 34% of the gross amount of electricity consumed by the EU is sourced from renewables, whereas only 9% of the gross amount of electricity consumed by the transport industry is sourced from sustainable forms of energy.

One of the measures that the European Commission has in mind is to introduce measures that promote the use of hydrogen in areas of the transport industry which have struggled to switch to electric-powered vehicles. The European Commission hopes that along with plans to rapidly increase the number of electric vehicles across the continent, these target-based measures will push the transport sector to greater sustainability. Another reform included in the revamp is tighter regulations on the sustainability of forest biomass being burned to produce energy. Such a policy change is likely to impact Nordic states with a high dependence on large forest-based industries.

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