A policy framework for climate and energy in the period from 2020 to 2030

To ensure that the EU is on the cost-effective track towards meeting its objective of cutting emissions by at least 80% by 2050, the Commission proposed the '2030 framework for climate change and energy policies'. It was adopted by the European Council in October 2014 as a strategic document, although binding legislation is yet to be drafted. It includes the binding 2030 EU domestic GHG reduction target of at least 40% compared to 1990, as well as a target of at least 27% for final renewable energy, and a at least 27% for energy savings by 2030 (target to be reviewed upwards to 30% in 2020). In addition, the EU ETS is to be reformed and strengthened. To achieve the 2030 binding 40% reduction target, the sectors covered by the EU ETS would have to reduce their emissions by 43% compared to 2005. In parallel, emissions from non-EU ETS sectors would need to be cut by 30% below the 2005 level, through national measures. To address the surplus of emission allowances in the EU ETS and to improve the system's resilience, a market stability reserve is to be established and the annual factor to reduce the cap on the maximum permitted emissions is to be changed from the current 1.74% to 2.2% from 2021. The volume of free allowances is to be reduced progressively; Member States with a GDP per capita below 60% of the EU average may opt to continue to give free allowances to the energy sector up to 2030, but the maximum amount handed out for free after 2020 should be no more than 40% of the allowances allocated to eligible Member States. The 2030 Framework stresses the importance of a fully functioning and connected EU energy market, as foreseen in the European Energy Security Strategy (2014). The Commission is to be supported by Member States to take measures to ensure achievement of a minimum target of 10% of electricity interconnections no later than 2020. The 2030 framework also launches the preparation of the Energy Union aiming at affordable, secure and sustainable energy, by 'pooling resources, connecting networks and uniting member states' power when negotiating with non EU countries'. Specific legislative proposals are expected in 2015.