EU Set to Unveil €210 Billion Energy Plan to End Reliance on Russia
- May 18, 2022
- Posted by: Quatro Strategies
- Category: Legislation
The European Commission prepares to unveil a €210 billion plan on Wednesday to set out a pathway to end reliance on Russian energy by 2027, and use the opportunity to accelerate its shift to low carbon energy.
The EU has been looking for a way out of its reliance on Russian energy following Moscow’s invasion of Ukraine. Russia supplies 40% of the bloc’s gas and 27% of its imported oil. EU countries have been struggling to agree sanctions on oil and reluctant to ban natural gas.
The Commission’s proposal is based on three main concepts to phase out Russian energy: a switch to import more non-Russian gas, a faster rollout of renewable energy, and more effort to save energy.
The draft proposal, which could change before it is published, include a mix of EU laws, non-binding schemes, and recommendations national governments could take up.
Brussels expects the plan to require an additional €210 billion investment if the measures are taken together. The EU aims to support the investment by freeing up more money for the energy transition from its COVID-19 recovery fund, and which would ultimately reduce the billions of euros Europe spends on fossil fuel imports each year.
The proposal outlines alternatives for short term replacement for Russian gas. It underlines the potential to import more LNG from countries such as Egypt, Israel and Nigeria.
The EU estimates that the continent’s gas demand will fall by about a third by 2030 under the bloc’s climate change targets. The proposals are expected to outline aims to produce 10 million tonnes of renewable hydrogen by 2030 and import another 10 million tonnes, which could be used to replace gas in industry.
The Commission also considers proposing higher targets to expand renewable energy and energy efficiency. The new proposed target is expected to be 45% renewables by 2030 up 5% from the previous target. A 13% cut in EU energy consumption by 2030, against expected use, is also under discussion to replace a current 9% proposal.
The package is also expected to include offering one year simplified permits for some wind and solar projects to cut the years-long permitting deadlines.
New EU schemes to jumpstart a large-scale rollout of solar energy would also attempt to cut gas-fueled power and heating in homes, offices and factories. The draft law includes requirement for members to install solar energy in all new public buildings from 2025.
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