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News 31 May 2022

REPowerEU Action Plan: stretching but achievable if R&I is put right

A first EERA appraisal of the Plan identifies its potentials and shortcomings, highlighting how clean energy research can best contribute to the success of the initiative

The REPowerEU Plan, published on the 18th of May, is the latest and most advanced attempt to boost the EU’s strategic autonomy in the field of energy, trying to sever the bloc’s ties with Russian fossil fuels imports. It also constitutes a further endeavour to tackle sustained energy prices in a way which remains compatible with the 2030 and 2050 EU climate-neutrality goals. The plan follows the first REPowerEU Communication (dating back to March) and aims high, with the declared objective to substitute the 155 billion cubic metres of gas currently imported with a mix of alternative gas routes and more renewable energy. Nonetheless, behind the political importance of the published Plan, much needs to be done to prepare the EU for such move. Substituting Russian fossil fuels will not happen fast and it will not be easy, with the risk of sparking protests across the continent if incisive mitigation measures are not put in place timely. At EERA, a detailed analysis of the Plan is currently being developed through an open dialogue between the members of the organisation’s community and will soon crystallise in a comprehensive position paper. In the run-up to this publication, discussions have brought to surface a series of preliminary considerations whose main highlights are reported here below.

In terms of feasibility, the provisions of REPowerEU will not be quickly implemented. Left aside the obvious economic reasons that make the transition complex, REPowerEU will need to face significant technical challenges. For instance, the push for increased renewable energy sources in the mix entails issues that need to be addressed, together with bold decisions in taking up options that have been left stranded for years.

First and foremost, a general lack of clarity risks to undermine the efforts not only at the EU policymaking level, but also in communicating the Plan effectively among the population (an integral part of the strategy, as 5% of the gas import reduction passes through the change in behaviour of the EU population). In this regard it is key to underline the difference between power and energy, which seems to be confused often when discussing REPowerEU. Power currently only represents 20% of the total energy demand in the EU, with heating occupying instead a major role in demand terms. Nonetheless, the focus on power is absolutely dominant in the EU Commission’s documents. Correlated to this is the argument in favour of more attention to advanced controls to the grid, as an increase in the production of energy will require better focus on the balance between production and consumption.

Together with clarity, a deeper understanding of the energy mix is needed too. It is indeed of critical importance to clarify the issue of energy storage, which can be confused between energy storage and storage of gas. While the second is crucial for many applications, energy storage as a technology encompasses a broader range of questions and issues related to heat and electricity. In this direction, the role of hydropower will for example be crucial. While being “a silent giant”, the potential stored in refurbishing hydropower plants for energy storage purposes is significant and might prove key for future grid stability. Heating, as mentioned, should become a focal point for R&I considerations going forward. Heat storage will be a crucial topic in winter times if gas reserves are to be substituted in the future, making the case for an even increased focus in heat pumps and other heat deployment technologies. Solar thermal technologies will also play a role in the transition as they provide both electricity and heat in a clean way and in sizeable quantities.

At the same time, solutions for the clean energy transition often look at long term implications. Noting that gas is here to stay, at least for the foreseeable future, it will be important to develop carbon capture and storage solutions (CCS) in pair with the gas contracts that will be signed in the coming months. If CCS is not deployed in combination with the new provisions for gas and LNG, the EU will risk locking itself in contracts that will undermine its long term green strategies. To enable all of the above, massive infrastructure investments will be fundamental to avoid risking longer-lasting problems. The point is important as well for energy savings in industrial processes, where electricity is not the optimal alternative due to its lower efficiency compared to other solutions.

Transversal to all the technologies mentioned above, there are issues that span throughout the clean energy transition spectrum. Dependence on third parties for the provision of raw materials, given the relative weakness of the EU in terms of supply of critical minerals, has the potential to reduce the chances to deploy the clean energy transition in the EU, besides the risk of creating new dependencies. In this sense, the renewed focus on the EU’s strategic autonomy must implement strategies to bring supply chains back to Europe, to avoid crises such as the ones experienced throughout the COVID-19 pandemic and the war in Ukraine. Last, but not least, the social dimension should be incorporated in the actions taken on the basis of the REPowerEU Plan. The issues of energy poverty and shortages of skills for the transition will take over the agenda of policymakers for the years to come and have already today an impact on the feasibility of plans aiming to deploy more renewable energy and solutions for renewable heating.

Notwithstanding the limits identified in the document, it is important to underline that the REPowerEU Plan represents a unique development in EU policymaking. The initiative can prove to be indeed an adequate roadmap to mobilise all financial instruments and increase energy independence, while at the same time accelerate a Paris-compatible just energy transition. As the clean energy research community, we are working to identify the challenges and address the questions that lay ahead to implementing REPowerEU. The final goal should be to make a reality the short term objectives without forgetting the longer perspective of climate-neutrality.