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Policy Brief

The European Union energy transition: key priorities for the next five years

The new members of the European Parliament and European Commission who start their mandates in 2019 should put in place major policy elements to unleash the energy transition. It is becoming economically and technically feasible, with most of the necessary technologies now available and technology costs declining. The cost of the transition would be similar to that of maintaining the existing system, if appropriate policies and regulations are put in place.

By: , , , , and Date: July 9, 2019 Topic: Energy & Climate

The issue
Over the last decade, the European Union has pursued a proactive climate policy and has integrated a significant amount of renewable technologies – such as solar and wind – into the established energy system. These efforts have proved successful and continuing along this pathway, increasing renewables and improving energy efficiency would not require substantial policy shifts. But the EU now needs a much deeper energy transformation to: i) decarbonise in line with the Paris agreement; ii) seize the economic and industrial opportunities offered by this global transformation; and iii) develop an EU approach to energy competitiveness and security, as the EU has neither the United States’ shale potential nor China’s top-down investment possibilities.

Policy challenge
A full-fledged energy transition is becoming economically and technically feasible, with most of the necessary technologies now available and technology costs declining. The cost of the transition would be similar to that of maintaining the existing system, if appropriate policies and regulations are put in place. In short, the EU could benefit from deep decarbonisation irrespective of what other economies around the world do. The transition can also be socially acceptable, if the right policies are put in place to control and mitigate the distributional effects of deeper decarbonisation. The time to act is now, because energy is a rigid system in which infrastructure and regulatory changes take a decade to be fully implemented, while competition is not sleeping – as Chinese solar panels and the rise of the electric vehicles industry clearly show. Policy choices made up to 2024 will define the shape of the EU energy system by 2050.

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External Publication

Long-term transmission rights and dynamic efficiency

We compare market designs for access regulation of a bottleneck transmission line, and study their impact on investment decisions by an incumbent firm with an existing dirty technology and entrant with an uncertain future low-carbon technology.

By: Georgios Petropoulos and Bert Willems Topic: Energy & Climate, Finance & Financial Regulation Date: June 16, 2020
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Past Event

Past Event

Insuring for pandemic-related losses, in this crisis and future ones

What remedies and lessons for the insurance sector in the time of pandemic?

Speakers: Gabriel Bernardino, Frederic de Courtois, Dirk Schoenmaker and Nicolas Véron Topic: European Macroeconomics & Governance, Finance & Financial Regulation Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: June 10, 2020
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Policy Brief

Rebooting Europe: a framework for a post COVID-19 economic recovery

COVID-19 has triggered a severe recession and policymakers in European Union countries are providing generous, largely indiscriminate, support to companies. As the recession gets deeper, a more comprehensive strategy is needed. This should be based on four principles: viability of supported entities, fairness, achieving societal goals, and giving society a share in future profits. The effort should be structured around equity and recovery funds with borrowing at EU level.

By: Julia Anderson, Simone Tagliapietra and Guntram B. Wolff Topic: Energy & Climate, European Macroeconomics & Governance Date: May 13, 2020
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Past Event

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On gains, losses, and trade-offs: the case of Border Carbon Adjustment

How will the border carbon adjustment be implemented and what will be the implications?

Speakers: Gabriel Felbermayr, André Sapir and Georg Zachmann Topic: Energy & Climate Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: March 5, 2020
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Blog Post

The EU’s poverty reduction efforts should not aim at the wrong target

The EU cannot meet its ‘poverty’ targets, because the main indicator used to measure poverty actually measures income inequality. The use of the wrong indicator could lead to a failure to monitor those who are really poor in Europe, and a risk they could be forgotten.

By: Zsolt Darvas Topic: European Macroeconomics & Governance Date: February 18, 2020
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Blog Post

A European anti-money laundering supervisor: From vision to legislation

In fighting anti-money laundering, the European Commission should act fast toward creating a central supervisory authority.

By: Joshua Kirschenbaum and Nicolas Véron Topic: European Macroeconomics & Governance Date: January 24, 2020
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Opinion

Europe’s Apollo 11 will not be about the moon

The European Green Deal has an ambitious double target to “reconcile the economy with the planet” and to become Europe’s “new growth strategy”.

By: Simone Tagliapietra Topic: Energy & Climate Date: December 13, 2019
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Past Event

Past Event

Enhancing climate policy through co-creation

First PARIS REINFORCE Stakeholder Council Dialogue

Speakers: Haris Doukas, Ajay Gambhir, Georg Zachmann, Dirk-Jan van de Ven, Jorge Moreno, Alexandros Nikas, Vangelis Marinakis, Glen Peters, Alexandre Koberle, Marc Vielle, Andrea Herbst, Rocco De Miglio, Annela Anger-Kraavi, Baptiste Boitier, Lorenza Campagnolo, Zsolt Lengyel and Joeri Rogelj Topic: Energy & Climate Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: November 21, 2019
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Past Event

Past Event

Better governance, better economies

This event will feature the presentation of the 2019 EBRD Transition report, which focuses on governance in the EBRD regions.

Speakers: Daniel Daianu, Beata Javorcik, Zsuzsanna Lonti and Guntram B. Wolff Topic: European Macroeconomics & Governance Location: Press Club Brussels Europe, Rue Froissart 95, 1000 Brussels Date: November 20, 2019
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Opinion

Four pillars to make or break the European Green Deal

The recipe for a successful European Green Deal is as simple as it is breath-taking: to intelligently promote deep decarbonisation by accompanying the economic and industrial transformation this necessarily implies, and by ensuring the social inclusiveness of the overall process.

By: Simone Tagliapietra, Grégory Claeys and Georg Zachmann Topic: Energy & Climate Date: November 14, 2019
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Policy Contribution

How to make the European Green Deal work

Ursula von der Leyen has proposed a European Green Deal that would make Europe climate neutral by 2050. With this Policy Contribution, the authors provide a first analysis on how to make this initiative work.

By: Grégory Claeys, Simone Tagliapietra and Georg Zachmann Topic: Energy & Climate, European Macroeconomics & Governance Date: November 5, 2019
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Blog Post

Demystifying carbon border adjustment for Europe’s green deal

From carbon leakage to “green protectionism”, the European Green Deal envisioned by the incoming Commission has many critics. But some adjustments to the deal could make domestic manufacturers more carbon efficient while simultaneously encouraging foreign producers to become more environmentally friendly.

By: Guntram B. Wolff Topic: Energy & Climate Date: October 31, 2019
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