On September 30th, ITRE (the Committee for Industry, Research and Energy) in association with ENVI (Committee on the Environment, Public Health and Food Safety) at the European Parliament held a hearing of the Commissioner-designate for Energy, Kadri Simson. The Commissioner-designate underlined her commitment to the functioning of the Energy Union, to provide clean and affordable energy to consumers, to facilitate the energy transition towards carbon-neutrality in 2050 and to assist those regions that are affected the most by the energy transition.

What are the energy priorities that Commissioner-designate for Energy that Ms Kadri Simson plans to put forward in the first 100 days of the new Commission’s mandate?

The Commissioner-designate for Energy, Kadri Simson highlighted that the energy policy will be essential in tackling climate change. As a Minister for Energy in Estonia, she has set out targets of reducing CHG emissions by 70 % in 2030 and by 80 % in 2050. According to that, the Estonian’s renewables target is higher than the EU’s with 33 % in 2020 and 42 % by 2030. During the first 100 days of her new possible mandate, she plans to work closely with other Commissioners to deliver the New Green Deal, where ITRE Committee will also play a key role in helping to deliver this new proposal.

During Simson’s introduction speech, she underlined the following energy priorities:

As the umbrella of the energy priorities, the new Commission will propose the 2050 carbon neutrality target and the European Green Deal. For the purpose of the transition period, the first European Climate law will be proposed by this Commission, accompanied by a Just Transition Fund which will be created to support the coal and carbon intensive regions (by phrasing out coal or fossil fuel). The final amount of this fund is currently under negotiations as being a part of the next MFF. Possible answers of this amount can be known by the end of November 2019.

Therefore, the Commissioner-designate for Energy highlighted the need to build on the success of Energy Union and to be committed to the implementation of the Clean Energy Package. Currently, the National Energy and Climate Plans (NECPs) will play a crucial role in implementation phase, and the final drafts per each member state will be delivered by the end of December 2019. After this deadline, the Commission has 3 months to negotiate further ambitious targets before the final approval. The next important priority is the emissions reduction of 50 % by 2030 followed by the plan to move towards 55 % in a responsible way. The Kadri's first step is to launch an evaluation about how each legislation in energy sector can deliver more ambitious targets – to access if there is a need to revise any legislation. Therefore, Ms Simson would contribute to the work of the current border tax and on the review of the Energy Taxation Directive. According to Ms Kadri's opinion, the carbon tax is meant to be better than the current one on carbon leakage and must be compliant to WTO rules.

Kadri Simson underlined that if elected, she intends to mobilise energy policy at the service of the climate neutral objective by further developing an integrated, interconnected and properly functioning single market and to enable cross regional integrated markets. In order to meet objectives, the smart integration of electricity, heating and cooling, transport and the industry is crucial. She also pointed out that the Strategic Energy Technology plan has potential and she intends to develop an agenda for greater digitalisation of the energy sector covering the implementation of the digital single market and the Clean Energy package rules on smart grids, day taxes and interoperability, but also aspects like artificial intelligence and cybersecurity.

The main MEPs interventions: what is the agenda on the implementation of the existing energy priorities as a future Commissioner for Energy?  

The members of ITRE Committee and ENVI Committee of the European Parliament have touched on some specific legislative fields, where they pointed out some of the main concerns. One of the first points addressed was the unavailability of the concrete measures to decarbonise energy sector, especially on the use of the nuclear power. Ms Kadri explained that in some certain cases the nuclear power plant will be operational but there must be provided a precise guidance on how to fulfil security requirements under the highest security standards.

Therefore, she also underlined that the Clean energy package is a good instrument which shows us the way to solve the market restrictions when it comes to integration of the European gas market. Some remarks were made on the readiness to fully implement the revision of the European Gas Directive, where Ms Simson agreed on the importance of the gas for district heating, since it is the most effective tool to replace the coal-based sources. She pointed out that in the future we do not speak about the natural gas but about the biogas and hydrogen in heating.

Some guessing on the possible revision of the RED Directive due to Ms Kadri's plan to increase the renewables targets have been made by MEPs. Therefore, Ms Kadri explained that we need to make sure that the conditions for the growth of renewables are there to accommodate them, promote research and innovation and to ensure the market will apply them first.

On the point of the facilitation of the investments in renewables and efficient low carbon energy, Ms Simson underlined that for those purposes, the good part of European Investment Bank (EIB) will become a climate bank. Besides that, there will be other funds dedicated to this energy transition such as CEF, Horizon Europe and LIFE, together with the next MFF which will deliver twice as many resources allocated to energy, research and the grid.

MEPs highlighted that one of the main targets in the future investment is renovation of buildings stock, all around Europe, especially in multi-apartment buildings. There, significant energy and cost savings can be booked. Therefore, the high intensity energy industries, district heating and cooling and buildings renovations goes too slowly. MEPs raised a question to include renovation of buildings in circular economy. On this matter, Ms Kadri explained that regarding the district heating, it can go in hand with using more bioenergy for heating, smart integration between sectors and new innovations for heat pumps. She pointed out missing funds to make renovations faster, therefore she suggested that to begin with, the member states can share the best practices while some of them already discovered smart ways to attract investments, especially from private sector.

On increasing the energy efficiency of buildings and question if she considers to »open« the EPBD directive once again, Ms Simson exposed the importance of the final NEPCs which will enable the Commission to get an overview on applied targets per each Member State. Currently, Ms Kadri explained that it is potentially likely that not all the Member States will be ambitions enough to meet the targets. Therefore, the negotiation period will allow the Commission to negotiate higher targets where needed.

Generally, Ms Kadri underlined that the biggest fund for energy investment will be CEF but for the renovation rates in buildings sector by Kadri's opinion, the biggest financial wave must come from the private sector. Due to that, Ms Kadri called for the appropriate legislation at the local level that shall allow multiapartment buildings to take a special loan. To make this action, the close cooperation of the national level to provide loans will be needed.

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