On 1 February 2023, the European Commission released its communication on a “Green Deal Industrial Plan for the Net-Zero Age”. This Communication outlines the actions that the Commission intends to take to stimulate investment in the “net-zero industry” within the EU. The Communication is a response to recent increases in state support outside the EU, most notably the United States Inflation Reduction Act.
Energy transition is the biggest change that the world is undergoing right now. The EU is taking significant steps to position itself at the forefront of the global race to net zero.
The EU has a legally binding target to achieve net zero by 2050. EU countries also already have very advanced plans for achieving net zero and energy security, accompanied by financial state support packages on an unprecedented scale. These measures have just been taken to the next level, making the EU an even more attractive market for investors in the energy transition.
Our latest sustainability guide, ESG Policy Guide – The Future of Sustainability Legislation for Luxury, has been developed in collaboration with Positive Luxury, the company behind the Butterfly Mark, a unique mark awarded to luxury lifestyle brands, retailers and suppliers in recognition of their commitment and verified actions to creating a positive impact on our world. It features recent and upcoming developments in ESG legislation and policies in the US, UK and the EU and explains how these impact the luxury, fashion, and cosmetics industries.
The EU has politically agreed on the adoption of the Corporate Sustainability Reporting Directive, and will likely adopt it before the end of 2022. The CSRD will overhaul the current sustainability reporting landscape for all multinational companies with significant activities in the EU, including those headquartered outside the EU. The reporting obligations of the CSRD will progressively come into force between 2024 and 2028.
On 14 September 2022, the European Parliament voted to adopt its negotiating position on the revision of the Renewable Energy Directive II. The Parliament agreed that its position should include a new headline target that 45% of all EU energy use would be sourced from renewable sources by 2030, and upward revised sectoral targets for buildings, transport and heating compared to the European Commission’s proposal.
There have been suggestions in the media that the EU ‘additionality’ requirements applied to the production of renewable fuels of non-biological origin, such as renewable hydrogen, have been effectively scrapped. This article clarifies the legal position in relation to the current status of the ‘additionality.’
Following the launch of the RePowerEU package, the European Commission continues to develop the regulatory framework applicable to renewable fuels of non-biological origin (mainly renewable hydrogen). Two draft Delegated Acts that will have a significant impact on the hydrogen market have been published for public consultation under the Renewable Energy Directive recast (REDII, Directive (EU) 2018/2001).
Amidst a shift to a low-carbon economy, the EU Taxonomy is a mechanism aiming to accelerate the European energy transition. In our new podcast, EMEA EMI Talks, Andy Moody (Partner, London; Head of Disputes and Chair, EMEA Energy, Mining and Infrastructure Group) and William-James Kettlewell (Associate, Brussels; Member of the Baker McKenzie Energy Transition Group) explore the impact of the EU Taxonomy mechanism on businesses that are active in the energy and renewables sectors, as well as risks and opportunities in the energy, mining and infrastructure sector in EMEA.
We know that the construction and operation of buildings has an enormous impact on energy-related carbon emissions, contributing around 40% globally. To deal with this, many real estate investors are committing to transition their real estate portfolios to achieve net zero greenhouse gas emissions by 2050 or earlier. Owners, occupiers, investors and funders of the built environment will come under increased pressure to reduce emissions and substantiate their sustainability credentials.
The legal recognition of a type of fuel via the introduction of a legal definition and certification framework is a defining step in establishing a market for such fuels. Renewable hydrogen took this step when it was officially recognized and supported at EU level by the 2018 recast of the Renewable Energy Directive, joining biofuels and biogases, at least for what concerns its uses in the transport sector.
On Wednesday, 15 December 2022, the European Commission adopted its proposals for a new EU Gas Package, through a recast of the Gas Directive and Gas Regulation. Below is a summary of the main updates.