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Economy and business need to adjust to climate change

Eugene Eteris, European Studies Faculty, RSU, BC International Editor, Copenhagen, 03.10.2016.Print version
Climate change poses a threat to the planet and people. Hence, the EU takes measures for energy transition to a low-carbon economy and society. Member states have to take the message as both the necessity and an opportunity.

Technology and innovations are important for the EU’s climate targets. It means, e.g. a) energy from renewable energy sources and new storage solutions; b) more intelligent energy and transport systems; c) new business models and smart cities that break the boundaries between energy, transport, construction and industry; d) technologies which make industry less carbon and resource intensive.

 

New opportunities

 

Energy transition and decoupling growth from emissions offers new opportunities: EU economy grew by 46% since 1990 while greenhouse gas emissions were reduced by 24%. The drive to a low-carbon economy is now global.

 

Such transformation creates a high number of high-quality jobs, e.g. in 2014, some 9 million jobs were linked to the transition to a low carbon economy and by 2030, the number would reach 18 million jobs. However additional political decisions are needed.

 

To implement the EU energy strategy (adopted in February 2015), many member states’ economy sectors and business models need to adjust: new business models will emerge with new technologies. Besides, people will need the right skills for this transition and adequate social measures will be required.

 

The challenge is to organise this transition, and to provide clarity and orientation for everyone affected by this transformation. 

 

EU energy strategy and emissions

 

The strategy includes various initiatives: to reform the emission trading system (ETS) for the energy sector and industry; to reduce greenhouse gas emissions (GHG) in sectors not covered by the ETS; to implement a strategy for low-emission mobility with legislation in 2017-18; to increase security of supply, better interconnections and better energy labeling system; to provide links between the energy union and the EU investment plan and the mew skills agenda.

There are already several EU legislative proposals during 2016: on reforming energy efficiency policy for jobs, growth and investment; on reforming the renewables legislation and for adjusting the electricity market design to the new technologies. Besides, the Commission wants the EU states to adopt national energy and climate plans covering periods from 2021 to 2030 with perspectives until 2050.


The Commissions Investment Plan, the European Structural and Investment Funds, Horizon 2020, the future Innovation and Modernisation Funds linked to the ETS reform, the Connecting Europe Facilities for energy, transport and telecommunication are key instruments for the low-carbon transition.

 

The EU's Cohesion Policy provides €69 bln for investments related to all dimensions of the Energy Union between 2014 and 2020: incl. € 29 bln for energy efficiency, renewables, co-generation, smart energy infrastructure and low-carbon research and innovation; € 40 bln for sustainable urban mobility and other low-carbon transport, e.g. rail, seaports and inland waterways.

 

The Commission announced that it would expand its investment power to trigger total investments of € 500 bn by 2020; the EU wants to ensure that at least 40% of the EFSI’s infrastructure and innovation issues are related to the low-carbon transition.

 

The combination of EFSI and other EU funds has been made simpler and can be particularly useful in the EU states with less developed financial markets or for riskier projects.

Besides, at least € 1.1 bln from the ESF will be dedicated to improving education and training systems necessary for the adaptation of skills and for the creation of new jobs in sectors related to energy and the environment. A number of actions within the New Skills Agenda for Europe adopted in June 2016 will seek to support the transition.

 

The "Blueprint" for cooperation on skills in specific economic sectors will encourage sectoral partnerships in industry and services to implement a sectoral skill strategy, supported by Erasmus+ and national efforts.

 

There is also a need and possibility to stimulate strong business-education partnerships as promoted through the Alliance for Apprenticeships or the European Pact for Youth. These partnerships can stimulate cooperation between partners in the green and renewable sectors and education and training providers. The Commission intends to launch a new call for proposals under Erasmus+ on VET-Business partnerships.

 

Perspectives

 

The member states must have a holistic approach to support research, innovation and competitiveness for a successful low-carbon transition. They have to examine where to improve funding programmes for low-carbon research, innovation and competitiveness including deployment of technologies, jobs, skills, growth and investment. These tools must be fit to support the low-carbon challenge in the energy, transport, construction sector and industry.

 

This is the main idea behind the EU plan for research, innovation and competitiveness under the Energy Union structures.

 

The EU financial market stipulates investment in low-carbon innovations. Some interesting global developments have occurred under the Paris Agreement, in the G20 and OECD.

The EU budget is also an important tool to achieve climate objectives: 20 % of it is committed to climate-related action. When discussing the next MFF, the member states have to see how to use the MFF to achieve both the EU-2030 targets and transition to a low-carbon economy.

 

Source: Speech/16/3241, at FEPS event “The new social contract: A fair transition”; Brussels, 29 September 2016 in:  

http://europa.eu/rapid/press-release_SPEECH-16-3241_en.htm?locale=en  

 






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