Electrification = Energy sovereignty or simply an industrial competitiveness policy?

On 17 July, the European Commission adopted its proposed Electrification Action Plan. At its core is a new target of 46% electrification by 2040, meaning electricity would account for twice its current share of the EU’s energy mix. This appears realistic, but will require new measures, as current policies would raise electrification to only 31%, according to Strategic perspectives. The aim is to send a clear signal to all stakeholders and show the way forward. This new target is expected to become a central pillar of future European energy and climate policy, alongside – or potentially in place of – existing targets for renewable energy, emissions reductions and energy efficiency gains.

Achieving this new energy mix will require action on energy prices. The Commission therefore proposes capping the tax differential between gas and electricity at 2 for industry (and 2.5 for households). This measure is essential to provide investors with a clear roadmap, giving them the visibility they need to guide their decisions. 

How, then, does the Commission intend to help municipalities play their part in this new strategy? It is proposing a Heating and Cooling Plans Facility, modelled on the European City Facilityinitiative, which Energy Cities helped to develop. This was one of our key recommendations, so it is very welcome news.

Yet the Electrification Action Plan still fails to recognise municipalities as key players in the future energy system. Everything is designed for industry. Another bank for industrial decarbonisation… There are no tools to empower citizens to strengthen the resilience of the energy system as a whole, by promoting local supply chains and increasing flexibility at neighbourhood level first.

A genuine energy independence strategy cannot focus solely on addressing industrial energy and supply. It must also boost local consumption of locally produced energy. To achieve this, we need a clear direction, a strategy and dedicated resources … – a comprehensive policy framework!

Let’s hope that the next Energy Union package, due by the end of the year, will address these shortcomings!