Fit for 55

In accordance with the European Commission’s 2019 climate plan, the Green Deal[1], the EU needs to achieve total climate neutrality by 2050 the latest and, as a step on the way, reduce greenhouse gas emissions by 55% by the year 2030 in comparison to 1990 levels. This goal was made legally binding in the EU through the adoption of the so-called European Climate Law (Regulation 2021/1119).[2] The same commitment has also been repeated in the climate plan that the EU submitted to the United Nations in accordance with the Paris Agreement in 2020.

In order to reach the goal of reducing emissions by 55%, on 14 July 2021 the EU Commission adopted the package ‘Fit for 55’, which aims to update and tighten EU legislation in the areas of climate, energy and transport. The package contains proposals for new legislative acts as well as proposals to amend existing acts. The different proposals are interlinked and complement each other.

The following legislative proposals and political initiatives are included in the package:

• a revision of the EU Emissions Trading System which, in addition to lowering the overall emission cap and increasing the annual rate of reduction, includes an extension of the system to shipping, an overview of aviation emissions, and the introduction of a separate emissions trading system for road transport and buildings;
• a revision of the Effort Sharing Regulation with regard to the Member States’ emissions reduction targets in sectors not included in the EU Emissions Trading System, with increased targets for each Member State regarding buildings, road and domestic maritime transport, agriculture, waste and small industries;
• a revision of the LULUCF Regulation on greenhouse gas emissions and removals from land use, land use change and forestry, which proposes, among other things, that the EU carbon sinks shall remove 310 million tonnes of carbon dioxide emissions by 2030 (compared to the 225 million tonnes set out in the European Climate Law), whereby individual removal goals shall be set for each Member State;
• a revision of the Renewable Energy Directive (RED II) which, inter alia, tightens the sustainability criteria for bio energy and increases the target for how much of the EU’s energy mix is to be provided by renewable energy sources by 2030, from 32% to 40%;
• a reworking of the Energy Efficiency Directive which, among other things, sets a binding annual target for reducing energy usage throughout the EU, provides guidance on how national contributions are to be determined and almost doubles the Member States’ annual energy saving obligations;
• a reworking of the Alternative Fuels Infrastructure Regulation, which obliges the Member States to expand the capacity to charge electric cars so that it keeps the same pace as the sale of emission-free cars;
• a revision of the Regulation on CO₂emission performance standards for new passenger cars and light commercial vehicles, which requires the average emissions from new passenger cars to be reduced by 55% by 2030 and by 100% by 2035, in comparison with 2021 levels;
• a revision of the Energy Taxation Directive, the purpose of which is to promote clean technology and to abolish obsolete exceptions and reduced tax rates, which at present encourages the use of fossil fuel;
• a new Carbon Border Adjustment Mechanism, which sets a carbon dioxide price on imports of certain products in order to ensure that climate measures in the EU do not lead to ‘carbon dioxide leakage’ in other States;
• the new initiative ReFuelEU Aviation, according to which fuel suppliers will become obliged to mix increasing amounts of sustainable fuel in aviation fuel when refuelling at EU airports, inter alia synthetic carbon dioxide efficient fuels, so called e-fuels;
• the new initiative FuelEU Maritime, which sets a limit for the permissible greenhouse gases that may be caused by the energy used by ships calling at European docks; and
• a new Social Climate Fund, which is to provide the EU Member States with specific tools to assist its citizens to invest in energy efficiency, new heating and cooling systems as well as cleaner mobility. The fund will be funded via the EU budget.

After the package was proposed, the Commission put forward, on 16 July and 21 December 2021, the following additional proposals that are also considered to be a part of the Fit for 55 package:

• a new Forest Strategy for 2030, which sets out the Commission’s strategy for improving the quality, quantity and resilience of EU forests by 2030;
• a reworking of the Energy Performance of Buildings Directive, which requires that all new buildings from 2030 must be zero-emission;
• a revision of the Third Energy Package for gas by proposing a new Directive and Regulation on the internal markets for renewable and natural gases and hydrogen, which mainly aim to establish a market for hydrogen, create an investment suitable environment and enable the development of dedicated infrastructure; and
• a new Methane Emissions Reduction Regulation that regulates methane emissions in the energy sector, with rules on e.g. measuring and reporting, detecting and repairing leaks and limiting venting and flaring;

The package is currently being discussed in the EU Parliament and the Council’s respective Committees and Working Groups for the relevant areas. The package is extensive and contains many complex and sensitive issues. In addition, in order to amend the Energy Taxation Directive unanimity is required in the Council.

Overall, the Swedish government is in favour of the package, although it takes the view that some parts thereof are too far-reaching. It opposes the proposal for a Social Climate Fund and is critical in respect of the proposed amendments to the LULUCF Regulation concerning e.g. the calculation model for carbon sinks, as the government believes it overestimates the Swedish sinks’ removal capacity.  

You will find the Commission’s communication on the Fit for 55 package here.

[1] Communication from the Commission dated 11 December 2019, ‘The European Green Deal’, COM(2019) 640 final.

[2] Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’), EUT L 243, 9.7.2021, s. 1–17.