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News 19 September 2023

Top story of the week: Significant progress on Green Deal Files during European Parliament plenary

From the 11th to the 14th of September, MEPs returned to Strasbourg for their first post-summer break plenary session. During this eventful week, which culminated in Ursula von der Leyen's final State of the Union speech of the mandate, substantial progress was made on several key files related to the Green Deal. While MEPs cast their final votes on the revision of the Renewable Energy Directive (RED) and on REFuelEU Aviation, they also adopted their positions to commence negotiations with the Council on two challenging dossiers: the Electricity Market Design (EMD) reform and the Critical Raw Materials Act (CRMA).

During her address, President von der Leyen praised the EU's climate action over the past four years and emphasised the importance of maintaining the bloc's leadership in the clean tech and renewables race. She promised to 'stay the course,' an ambition that MEPs appeared to share as they brought the EU closer to the Green Deal's finish line. After extensive discussions on the role of nuclear energy and biomass, lawmakers adopted the revision of the Renewable Energy Directive (RED III) with a large majority—470 votes in favour. This revision sets a target for 42.5% of EU energy to be renewable by 2030, along with a 14.5% reduction in greenhouse gas emissions in the transport sector.

With 518 votes in favour, MEPs also approved REFuelEU Aviation, which will progressively increase the quantity of Sustainable Aviation Fuels (SAF), including e-fuels, until 2050. SAFs are expected to represent 70% of the blend by then, with most SAFs coming from sources like cooking oil and animal fat. The law also introduces stricter monitoring of the 'non-CO2 effects of flying' and the creation of an EU label for the environmental performance of flights. Both files will now be endorsed by the Council before being published in the Official Journal and coming into force.

The Green Deal Industrial Plan also saw significant progress during the plenary session. The Parliament adopted its stance on the Electricity Market Design reform. However, trilogues will commence once the 27 Energy ministers reach a compromise on the issue of support for existing nuclear plants—a matter that also divided the Parliament. In fact, the decision to enter trilogues based on the ITRE Committee's report was only approved by 366 MEPs, while 180 attempted to request a 'plenary check' of the EP's position to open the possibility of proposing new amendments. Although the initiative did not proceed, many noted that the Parliament's position is now weakened.

On the other hand, trilogues on the Critical Raw Materials Act will begin on 20 September, as both the Parliament and the Council have now adopted their respective negotiating mandates. The Parliament's text, adopted with a large majority, builds on the Commission's proposal to strengthen and make supply chains more resilient by emphasising 'strategic projects' and collaboration with partner countries such as Chile and Australia. It proposes to increase the EU's processing capacity from 40% to at least 50% of the EU's annual consumption of Strategic Raw Materials (SRMs), a subset of CRMs of primary importance for the Clean Energy Transition. Additionally, it sets ambitious goals for the development and deployment of substitutes for raw materials and recycling capacities. This version of the text now calls for a moratorium on deep-sea mining, an issue that will undoubtedly face significant scrutiny from both environmental activists and industry players during upcoming negotiations. More progress is expected shortly as the Spanish Presidency of the Council aims to finalise as many files as possible before handing over to Belgium at the end of the year.