The EU’s Green Deal is Good for All

European Green Deal – Source: European Commission

In decarbonisation lessons, one of the first thing you learn is a simple rule: with respect to greenhouse gas emissions coal is worse than oil, which is worse than gas. As a result, policy makers have consciously encouraged switching to lower emitting fossil fuels.

This is low-hanging fruit: greenhouse gas emissions reduce without the cost and disruption of introducing new energy systems, countries make progress towards the early years decarbonisation targets (from now until 2030) and politicians have that rarest of things: a good news story to announce.

Perhaps surprisingly, in Europe it’s the UK that has done this most successfully. Much of the last 30 years has seen a remorseless exit from coal in the UK. This culminated in a stream of announcements about completely coal-free power generation days and weeks. Up to 16 June 2020, the country had a record 67 days without coal. These aren’t freak occurrences: coal production and imports to the UK in 2018 were 80% lower than in 2008, according to the trade body Euracoal.

How did the UK do that?

In the decade from 1990 the UK experienced a “dash for gas”, in which the newly liberalised power generation market invested in Combined Cycle Gas Turbines (CCGTs). No new coal-fired power plants have been built in the UK for over 30 years. All that is left are older, inefficient coal-fired plants, mostly those commissioned in the 1960s and 1970s.

The UK has long been a world leader (really) in moves to improve air quality and reduce greenhouse gas emissions. The Environment Act 1995 required the UK government and the devolved administrations to produce a national air quality strategy. The Climate Change Act 2008 committed the UK government by law to reducing greenhouse gas emissions by at least 80% of 1990 levels by 2050.

In 2015, the UK was the first national government to announce a commitment to phase out unabated coal use, setting a target date of 2025. At COP23 (23rd Conference Of Parties to the UN Climate Change Conferences) in November 2017, it became a founder member of the Powering Past Coal Alliance. And in 2018, the UK confirmed the phasing out of coal in a report entitled Implementing the end of unabated coal by 2025.

What about the rest of Europe?

The UK’s success in reducing the contribution of coal to the energy mix is not replicated in much of the rest of Europe. Most major coal producing and importing EU member countries had reduced coal use by between a third and a half in the decade to 2018. However, counter to many people’s stereotypes, Germany and the Netherlands hardly moved. Indeed the Netherlands actually increased coal usage over this period.

Germany has a plan, “Energiewende”, to transition to a low-carbon nuclear-free economy. The problem is, the easiest way for Germany to become nuclear-free is to use coal as an alternative source of power generation. A coal-exit commission set up in February 2019 by the German Energy Ministry suggested a pathway to phase out coal by 2038. Even this has met some resistance: there are still concerns that Germany should not abandon coal as its only sizeable domestic energy source.

The Netherlands remains one of the most fossil-fuel and CO2-intensive economies among the International Energy Agency (IEA) member countries. This is partly due to the existence of coal-fired power stations built in the last ten years, now being quickly phased out, supplied with imported fuel (the Dutch produce no coal).

So, both Germany and the Netherlands are some way behind the UK, and this is also true for the whole of Europe with respect to another climate control measure, Carbon Capture and Storage (CCS). CCS involves separating carbon dioxide from gases produced in electricity generation and industrial processes, and then transporting it by pipeline or by ship for safe storage in carefully selected geological rock formation that are typically located several kilometres below the earth’s surface. Rystad Energy estimates that up to 80% of CCS capacity in 2035 in Europe will be in the UK.

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Working together to tackle climate change

Of course, tackling climate change isn’t a competition; it’s only by working together, having a common strategy and sharing thinking, technologies and resources that we can make the planet cleaner than it is. There’s no point in one country being carbon neutral when the rest of the world continues in its fossil fuel consuming, polluting ways.

The EU’s Green Deal, published in December 2018, recognises this and resets Europe’s commitment to tackling climate change. It aims to decouple economic growth from resource use. Key to this is a Sustainable Investment Plan that combines dedicated financing for sustainable investment and proposals to improve the framework to encourage green investment. With a pipeline of sustainable projects, technical assistance can be provided to help the private sector to identify and prepare projects and access sources of finance.

There are many aspects to this:

  • A regulatory framework is needed to foster deployment of innovative technologies and infrastructure, for example to develop a hydrogen network, or to implement effective CCS
  • Research into new technologies must be mobilised and innovation encouraged
  • A pan-European “Climate Law” would ensure all countries adhere to common standards
  • Tax reform must be encouraged at the national level – for example, removing subsidies from fossil fuels.

This is a noble aspiration, but requires a massive public investment combined with an increased effort to direct private capital towards climate and environmental action. To give an idea of the scale of what is needed, reaching the current EU 2030 climate and energy targets requires an estimated €260bn of additional annual investment.

What happens after UK leaves the EU?

The UK is not an island packed full of climate deniers. This country continues to be at the forefront of efforts to reduce the impact of human behaviour on the climate. Examples include Cadent’s Hynet project to develop a large-scale hydrogen network in the North West of England, and Northern Gas Network’s H21 project, which plans to convert the whole of the Leeds area gas distribution system to hydrogen.

What the huge cost and immense technical and logistical complexity of these and other projects show is the need for international cooperation, to share ideas, resources and experiences under a common framework. Let’s hope we continue to adhere to the principles of the EU’s Green Deal even after the transition period ends in December this year. The UK’s move away from coal is not the end of our carbon-free journey, nor is it the beginning of the end of that journey; it’s only the end of the beginning.