‘Fit for 55’: a quick overview

Introduction

The EU has set a binding target of achieving climate neutrality by 2050. This requires current greenhouse gas emission levels to drop substantially over the next decades. As an intermediate step towards climate neutrality, the EU has raised its 2030 climate ambition, committing to cutting emissions by at least 55% by 2030.

What is the Fit for 55 Package

The Fit for 55 package is a set of proposals to revise and update EU legislation and implement new initiatives with the aim of ensuring that EU policies are in line with the climate goals agreed by the Council and the European Parliament.

The EU is working on the revision of its climate, energy and transport–related policies in order to align current laws with the 2030 and 2050 ambitions. The package is intended to provide a coherent framework for reaching the EU's climate objectives, which:

• ensures a just and socially fair transition;
  
  
• maintains and strengthens innovation and competitiveness of EU industry while ensuring a level playing field vis–à–vis third country economic operators; and
  
  
• underpins the EU's position as leading the way in the global fight against climate change.

The Council as Co Legislator

The Fit for 55 package proposals are initially presented and discussed at a technical level within the relevant policy specific Council working party in advance of going before the EU Member States’ ambassadors. 

The Fit for 55 package was submitted to the Council in July 2021 and discussions are currently being held to prepare the ground for an agreement on the proposals among the 27 EU Member States.

What is included in the Fit for 55 package?

• Review of the EU Emissions Trading System (EU ETS) – a comprehensive set of changes to the existing EU ETS that should result in an overall emissions reduction in sectors concerned of 61% by 2030 compared with 2005. For aviation, this includes the phasing out of the allocation of free allowances. This will be extended to other sectors including maritime, road transport and buildings.


• Increase of the Member States’ binding annual emissions reduction targets. The EU–level greenhouse gas emissions reduction target will increase from 29% to 40%, compared with 2005 and in turn the national targets will be updated accordingly. 


• EU-level target for emissions and removal from land use, land use change and forestry for net removals of greenhouse gases of at least 310 million tonnes of CO2 equivalent by 2030, which is distributed among the Member States as binding targets.


• Review of the renewable energy directive to increase the current EU–level target of at least 32% of renewable energy sources in the overall energy mix to at least 40% by 2030.


• Revision of the current energy efficiency directive by increasing the current EU–level target for energy efficiency from 32.5% to 36% for final, and 39% for primary energy consumption.


• Revision of existing legislation aiming to accelerate the deployment of infrastructure for recharging or refuelling vehicles with alternative fuels and to provide alternative power supply for ships in ports and stationary aircraft.


• Introduce increased EU–wide reduction targets for 2030 and sets a new target of 100% for 2035 in respect of the CO2 emission standards for cars and vans intended to stimulate the switch to electric driving.


• Revision of the Council directive on the taxation of energy products and electricity which aims to:
  
  
  • align the taxation of energy products and electricity with the EU's energy, environment and climate policies;
  
  
  • preserve and improve the EU internal market by updating the scope of energy products and the structure of rates and by rationalising the use of tax exemptions and reductions by Member States; and
  
  
  • preserve the capacity to generate revenues for the budgets of Member States.
  
  
• Carbon border adjustment mechanism– the proposal for a carbon border adjustment mechanism (CBAM) is to prevent, in full compliance with international trade rules, the situation where emissions reduction efforts of the EU are offset by increasing emissions outside its borders through relocation of production to non–EU countries (where policies applied to fight climate change are less ambitious than those of the EU) or increased imports of carbon-intensive products.


• Reduction of the aviation sector’s environmental footprint by looking at sustainable aviation fuel. 


• Reduction of the greenhouse gas intensity of the energy used on-board by ships by up to 75% by 2050, by promoting the use of greener fuels by ships.


• Social climate fund which allocates a total of €72.2 billion over the 2025-2032 period through an allocation methodology that aims at tackling the uneven impact of the proposed separate emissions trading system for these two sectors, expected across and within Member States.

In separate articles, we consider the impact of Fit for 55 on the Built Environment and new consultations to raise energy efficiency standards in buildings in England and Wales.