The most urgent issue with which REC has been dealing is the Climate & Energy Aid Guidelines (see draft-CEEAG ) which will place limitations on Member States’ freedom (1) to award state aid to renewable and low-carbon energy developments and (2) to compensate specific electro-intensive industries for the cost of levies intended to pay for that state aid. These CEEAGs are proposed to replace the current EEAGs but, as currently written, no longer include Industrial Gases in the list of sectors eligible for aid. This is technical, but let me share one number to illustrate the importance: the cost involved for our membership exceeds half a billion euros! Our experts met bi-weekly and exchanged hundreds of emails. We provided feedback to the European Commission, participated in the official consultation and reached out to the relevant Commission services and Commissioners’ cabinets. We were supported by national associations and other industry associations. We continue to advocate for inclusion of the Industrial Gases sector in CEEAG (see this infographic for our arguments) and we expect adoption of the final legislative proposal before the end of 2021.
Less urgently but of potentially greater significance, in July the European Commission’s ‘Fit for 55’ package of proposals was published. It contains a long list of proposed directives and regulations that are intended to bring EU policies into line with the target of 55% emissions reduction by 2030. Some of the proposals in the package would have significant implications, positive and negative, for our sector; this is particularly so for the proposed revisions of ‘RED 2’ & ‘ETS4’. Further, in December we expect the publication of the “Gas Package” which will complete the Commission’s slate of energy and environmental proposals that will be carried forward for debate and decision by the European Parliament and Council in the coming months.
Many readers will also be aware of the difficult discussions between the Commission and some Member States on the ‘Taxonomy’. The implications for industrial gases are more complex than can properly be represented in this short report but readers should be aware that REC is following developments and will intervene when appropriate to support the interests of our sector.
It is clear that REC will be busy in 2022, with its broad objectives being:
to maintain a level playing field between insourced and outsourced industrial gases production, supported by the argument that the efficiency gains from outsourced production can and do support the achievement of energy and climate ambitions;
to highlight the benefits arising from private hydrogen networks to ensure customers have access to the required purity and reliability of supply;
to ensure recognition of ASUs as key underpinnings of industrial decarbonisation.
EU policies are changing fast. On the one hand, these policy developments bring into sharp focus how the skills of EIGA members will become more and more critical if climate ambitions are to be met. On the other hand, some of these policy proposals have the potential to undermine key aspects of our traditional business model.