Terms
Terms
Terminology
Building blocks are the economic sectors, such as energy, transport or industry, and cross-cutting areas, such as finance, innovation, and lifestyles, in which transformation is needed to achieve a climate neutral society by 2050, and across which ECNO tracks progress.
Building block assessment
Acceleration factor
Or the ‘required change in speed’ is the ratio of the required change versus the past change on a given indicator. This results in the example formulation: ‘We need to increase our annual emission reductions to at least 4.9 Mt CO2e per year – or 2.6 times faster than the 1.9 MtCO2e per year achieved in the past’.
Benchmarks
Future reference points against which progress for each indicator is compared. ECNO derives benchmarks from official EU sources, such as directives, regulations, strategies, and action plans, including their related impact assessments. Benchmarks often come in the form of quantified policy goals or targets.
Climate neutrality
Stands for the objective of achieving net zero greenhouse gas (GHG) emissions. This means that emissions are brought down as close to zero as possible, with remaining, difficult to abate emissions balanced by GHG removals within a given country or region.
Enablers
The supporting conditions and underlying changes needed to meet the objectives in a given building block. They are the opposite of barriers or inhibitors.
Historical data
Includes, but is not limited to, statistics from Member States harmonised and provided by Eurostat or the European Environment Agency (EEA) as well as from international organisations such as the OECD, FAO, or World Bank.
Indicators
Track the historical development and status of enablers and objectives based on quantitative data. An assessment of indicator progress compares the trend against the required development to meet a future reference point, where data and relevant benchmarks are available.
Objectives
Describe what needs to be achieved in each building block to reach climate neutrality.
Required change
The change that underlies a pathway that meets the identified benchmark or target. Where benchmarks are missing, the required change indicates a direction and speed of change.
Trend
The development of an indicator over time based on historical data. ECNO’s trendline is a straight, best-fit line that smooths out the variation in historical developments based on all data points, providing a sense of the general progress over time.
Electricity
Electricity plays a central role in decarbonising energy supply and its importance will only increase over time through sector coupling (the electrification of demand sectors). Emission reductions are mainly realised through the phase-out of fossil fuels and the build-up of renewables.
OVERVIEW:
Progress on electricity has been too slow
While emission reductions in the power sector are on track with the EU’s own set trajectory, important underlying drivers are not. Renewable energy growth has seen mixed progress with solar largely on track while wind energy needs to at least double. Fossil fuel phase-out needs to be sped up substantially as it was hampered in recent years by limited reductions in coal and other fossil power since 2019. There are insufficient data to track progress on electricity market development, grid investments, grid digitalisation, and clean flexibility options, both on the supply and demand sides. The EU has taken a proactive role in designing new market rules but has only recently stepped up efforts on integrated grid planning and the inclusion of clean flexibility options.
INSIGHT FOUR
A shift from gas as a flexibility option to clean energies is needed
The EU needs to continue to intensify the shift from fossil-based electricity supply-side flexibility options, especially natural gas, towards clean supply-side options, such as energy storage. Recent efforts by the EU to encourage Member States to incentivise these shifts need to be followed through with policy development.
OBJECTIVES
Objectives describe what needs to be achieved in each building block to reach climate neutrality.
Objective 1
Decarbonise electricity supply
Emissions in the power sector are on track with the EU’s own set trajectory but require more effort to also stay on track moving forward. Electricity demand is set to increase due to electrification in other sectors. A sustained decrease in emission intensity requires a stronger uptake of renewables.
GHG emissions of electricity generation
This indicator shows the past development of GHG emissions from electricity generation in comparison to the EU trajectory of reaching a reduction in emissions of 78% in 2030 compared to 2005 levels.
Data show an annual decrease of 60.5 MtCO2e between 2016 and 2021. This is faster than the benchmark trajectory, where the required annual decrease between 2021 and 2030 needs to be 50.3 MtCO2e.
The indicator includes all GHG emissions from central energy generation which is primarily the generation of electricity from power stations, combined heat and power stations as well as a small share of central heat generation.
Objective 2
Fossil fuel phase out
Fossil fuel phase out in the power sector is too slow in comparison to the EU’s own trajectory. A historic shift from coal to gas needs to be followed by a shift from gas to renewables, and even has been reversed due to the gas crisis. Especially gas phase out needs to be accelerated.
Share of fossil fuel-fired power generation
This indicator shows past development in the share of fossil fuels in electricity generation in comparison to the EU target of reaching a share of 18% in 2030.
Data show an annual decrease of 1.3 %-points between 2016 and 2021. To meet the benchmark, the required annual decrease between 2021 and 2030 needs to be 2.5 %-points, which is 1.9 times faster than the current rate of progress.
The indicator shows the share of fossil-fuel power generation in total electricity generation.
ENABLERS
Enablers are the supporting conditions and underlying changes needed to meet the objectives in a given building block. They are the opposite of barriers or inhibitors.
Enabler 1
Reform of electricity markets to enable participation of renewables
Share of variable renewable energies in electricity generation
This indicator shows past development in the generation share of variable renewable energy sources (wind and solar) in comparison to the EU trajectory of reaching a 48% share in electricity generation in 2030.
The data show an annual increase of 1.5 %-points between 2016 and 2021. To meet the target, the required annual change between 2021 and 2030 needs to be 3.2 %-points, which is 2 times faster than the current rate of progress.
The indicator compares the electricity generation from variable renewable energies such as wind and solar with total electricity generation.
Electricity interconnector capacity availability for cross-zonal trading
The indicator measures in how far TSOs in countries are setting aside interconnector capacity for cross zonal trading. It is a proxy for measuring the transmission grid interconnection between countries and thus reflects the progress towards and integrated European Grid. The EU set target for a minimum of 70% of electricity interconnector capacity for cross-zonal trading.
There is not enough data to track this indicator, but a qualitative comparison suggests that change is far too slow.
The indicator is defined by the EU as the electricity interconnector capacity for cross-zonal trading that Transmission System Operators (TSOs) have to provide.
Enabler 2
Grid build-out, digitalisation, and enhancement
Investment into the transmission and distribution grid
This indicator shows past development in investments in electricity grid infrastructure (transmission and distribution). While data for the historical trend as well as for a future benchmark are available, differences in how these are defined in terms of scope of the definition do not allow for a comparison of the trend with the benchmark.
Data show an annual increase of 5% between 2017 and 2022. This development was heading in the right direction but was too slow as the EU suggests a 15% increase in investments compared to its own baseline.
The indicator describes investments in electricity networks as defined by the IEA.
Share of electric smart meters
This indicator shows past development in the share of smart meters in electric meters. Smart meters allow prosumers and consumers to account for electricity generated locally and fed into the grid. While there is no official benchmark data, a share close to 100% would enable the digitalisation of the grid and thus the energy transition.
Data show an annual increase of 24% between 2014 and 2020, which was far too slow because a continuation of the trend would mean that the EU would reach a 100% diffusion only close to 2030.
The indicator describes the share of electricity metering points that were equipped with a smart meter.
Enabler 3
Increasing demand and supply flexibility to enable uptake of variable renewable energy sources
Battery storage and dispatchable renewable energy additions
This indicator shows past development of the clean supply-side flexibility options in comparison to the EU trajectory of reaching 287 GW in 2030.
There were not sufficient data available for storage capacities. The data for dispatchable renewable sources showed an annual increase of 0.3 GW between 2016 and 2021, which is on track when compared to the indicative benchmark of reaching 173 GW in 2030 requiring no further increase.
The indicator includes total capacity per year of battery storage and dispatchable renewables, which can be scheduled and controlled to follow the electricity load curve.
Flexible power demand
This indicator shows past development in flexible power demand in the EU. Flexible power demand, such as large industrial consumers, electric vehicles, or appliances can play an important role in a future power system that cannot rely on fossil-based flexibility options.
Data is insufficient as there is only one data point available, and hence no trend can be derived.
The indicator measures the yearly available flexible power demand.
report
State of EU progress to climate neutrality
The assessment of progress towards climate neutrality shows that the EU is moving in the right direction, but the pace is too slow. The transition to climate neutrality is essential for ensuring a liveable future.
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