Europe’s climate neutrality goal is in jeopardy due to “insufficiently detailed, inconsistent, and even contradictory” national plans, experts at the European Climate Neutrality Observatory (ECNO) have warned.
Released yesterday (31st January), ECNO’s report, “Net zero risk in European climate planning: A snapshot of the transparency and internal consistency of Member States' NECPs”, finds that countries have so far failed to deliver robust plans for climate progress over the next 6 years in this decisive decade of action.
The report focuses on the crucial cross-sector resources of renewable electricity, hydrogen, land, bioenergy and the geological storage of carbon dioxide. It assesses the completeness, consistency and quality of information on those sectors within draft NECPs from Italy, Hungary, the Netherlands, Spain and Sweden, and calculates the “transparency gap” for the projected shortfall on emissions reductions targets by 2030.
Key findings include:
TRANSPARENCY GAPS
The projected combined shortfall across all five countries is 101 MtCO2e (million tons of carbon dioxide equivalent) per year by 2030 - more than Austria’s net annual emissions in 2021 at 77 Mt CO2e.
Sweden’s plans imply net negative emissions by 2030, which ECNO’s experts do not deem credible as they have not been properly updated since the previous version, while Hungary’s plans may lead to an increase in greenhouse gas emissions.
HYDROGEN - RISK OF FOSSIL FUEL DEPENDENCE AND SUPPLY SHORTAGES
The plans do not take a properly joined-up view of economy-wide renewable energy supply and the scaling up of renewable hydrogen. This brings a risk that insufficient renewable electricity will be available to produce enough green hydrogen to meet demand, and that carbon intensive hydrogen will be used to make up for supply gaps.
In Hungary, the estimates of projected domestic hydrogen production are less than half of the anticipated demand in 2030 of more than 4 TWh, leaving a substantial gap to be filled. The NECP ambiguously speaks of “low-carbon” hydrogen as opposed to green hydrogen.
In the Netherlands around 40 TWh of electricity will be needed in 2030 to cover the domestic renewable hydrogen production, representing between 30 percent and 40 percent of the projected national renewable electricity production. This means a high share of renewable resources would be used with much lower efficiency than by using it directly as electricity.
BIOENERGY - RISK OF DRIVING DEFORESTATION AND LAND USE COMPETITION
The NECPs lack well-quantified domestic production targets for bioenergy, as well as detail on inputs, infrastructure development, imports and funding. This carries a risk of failing to meet demand. as well as driving deforestation abroad. There is also a risk of over-reliance on bioenergy as it can increase competition with other land uses, including food production.
Hungary plans on increasing the use of first-generation biofuels which poses a major risk, as increasing the reliance on energy crops intensifies competition for land, including for food production which could harm the country’s food security and reduce the country’s natural carbon sinks.
The Netherlands projects future production of 2 billion cubic metres of biogas, which is not expected to fulfil demand. Imports are planned, but neither quantified nor anticipated in terms of concrete partnerships, carrying the risk of supply coming from unsustainable sources.
CARBON CAPTURE - CONFUSION BETWEEN STORAGE AND UTILISATION, AND HARM TO CLIMATE GOALS
A lack of distinction in some NECPs between Carbon Capture Storage (CCS) and Carbon Capture Utilisation (CCU) leads to planning inconsistencies and uncertain climate outcomes, as utilisation often implies storage only in the short- to medium-term, as opposed to the more permanent benefits provided by long-term geological storage (LTGS) of CO2. Excessive reliance on CCS also carries the risk of locking in fossil fuel dependency as it distracts from reducing avoidable emissions.
Sweden and Spain did not disclose details about their strategies regarding LTGS of CO2 in their NECPs, while also failing to clearly rule out the use of the technology, suggesting low-quality planning.
The Hungarian NECP states that it will focus mainly on utilisation of the captured carbon, due to insufficient domestic storage space. However, modelling in the Hungarian NECP implies that carbon capture technologies are expected to deliver negative emissions in industry and power generation sectors from 2040, which is impossible to achieve with CCU, since utilisation typically does not offer durable storage.
The Italian NECP relies heavily on CCS to stabilise emissions in the industrial sector. Alternative decarbonisation measures for industry are not clearly stated, implying that CCS may be deployed rather than reducing avoidable emissions wherever possible, which locks in continued fossil fuel dependency.
“We need to avoid a situation where Europe’s demand for bioenergy results in land grabs and accelerated deforestation around the world, or where our demand for green hydrogen outstrips the available supply of renewable electricity to generate it alongside other clean energy needs” said Julien Pestiaux, lead author of the report and a Partner at CLIMACT, one of ECNO’s consortium partners. “We also cannot pretend that carbon capture utilisation is the same as carbon capture storage - the former is not always a long-term climate solution, and the latter must be used only where strictly necessary. Our analysis shows an urgent need for Member States to up their game with regards to charting out how they will meet their 2030 climate targets. The plans we have tested are insufficiently detailed, inconsistent, and even contradictory in places. Getting onto a climate-neutral pathway in this critical decade of action requires much more coherent and integrated cross-sectoral planning for the near term, avoiding blind overreliance on limited resources, and tackling bottlenecks with regard to critical infrastructure.”
The NECP process is designed to make sure that Member States plot out in detail the actions to be taken across their economies to deliver their climate targets. If the identified planning inadequacies are not addressed, Member States may face shortages and competition for vital resources, both between sectors and with their European partners, and ultimately, missed economic opportunities.
The report shows that Member States urgently need to take a more holistic view of the interdependencies between sectors and countries in their planning, address inadequate infrastructure and technology investments, and ensure that the combined reliance on key resources is realistic. By shining a light on key areas where these early drafts typically lack coherence and clarity, the report aims to support governments across the EU to improve their NECPs ahead of their final submissions.
The five plans were selected for analysis to give a view of the geographic spread of the European Union, based on those that were available as of June 2023 when they were submitted to the European Commission for review.
Member States have until June 2024 to finalise their plans and submit them to the Commission. Some countries, including Poland and Austria, have yet to even submit a draft, while the Commission urged all Member States to “enhance their efforts” in December after reviewing the draft submissions.
“We hope policymakers take heed of the shortcomings identified by our report and take steps to ensure their final plans are robust and transparent” added Aneta Stefańczyk, a contributing author to the report and a Public Policy Analyst with Reform Institute, another of ECNO’s consortium partners. “Member States should seize the NECP process as an opportunity to enhance collaboration and coordination both between sectors and between countries, and set themselves up for success in meeting their targets. Considering the next round of plans isn’t due for another five years, we need to get it right this time around. Good planning will be the bedrock of a smooth and successful transition that enables everyone to reap the economic and social benefits that climate neutrality can bring.”
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