This week in EU policy: Major funding for renewables and vote on vehicle C02 rollback

This week the all-important EU plenary session, the monthly high-level meeting of the parliament – is sitting in Strasbourg. High on the agenda this week will be the blackouts we saw across the Iberian peninsula, which have seen people calling for overhauls to the bloc’s grid – something that may offer some opportunities for clean and renewable energy providers. But that’s not the only impact-relevant thing they’re looking at.

1. MEPs to vote on Commission proposal for C02 flexibility

The news: European MEPs are voting this week on the European Commission’s proposal to amend the vehicle C02 emissions regulations, to give more flexibility on performance standards for new cars and vans.

What happens now: If approved, the amendment will apply from 2025.

What it means for impact companies and investors: It’s another example of the EU rolling back some of its ambitions on climate targets. The amendment in theory allows manufacturers to be judged over a three-year period on reducing emissions of their vehicles, rather than annually. They’re arguing that this will give businesses more certainty, but from an impact viewpoint it sure does look like pushing deadlines back for emissions reduction. Belgian MEP Saskia Bricmont called it a “serious mistake.”

2. Commission to present roadmap to ending Russian fossil fuel imports

The news: The European Commission is expected to turn in its long-awaited plan to phase out all Russian fossil fuel imports.

What happens now: Unclear for now – the timeline and procedure all depend on the roadmap.

What it means for impact companies and investors: The EU has already done a lot to reduce its reliance on Russian fossil fuels, though as Commission President Ursula von der Leyen has said, much more needs to be done. This roadmap is expected to outline new restrictions for individual member states on Russian imports. LNG is expected to fill much of the gap, as it already has been doing, but it presents an opportunity for renewable and clean energy providers to help individual member states meet their energy needs.

3. Germany gets energy industry veteran as energy minister

The news: In a somewhat surprising move, incoming German Chancellor Friedrich Merz has announced Katherina Reiche – who left politics ten years ago to work in the energy industry - as the Federal Minister for Economic Affairs and Energy.

What happens now: Having cleared the final hurdles, Merz is expected to be sworn in as Chancellor today, Tuesday the 6th, and his government will be put into place.

What it means for impact companies and investors: Reiche is an interesting proposition. With her long experience on the corporate side, she fits neatly into soon-to-be Chancellor Merz’s vision for a business-friendly Germany – Merz has many times made it clear that stability is his priority over climate action. On the other hand, Reiche herself has long spoken out about the need for a renewables transformation in the country, which suggests she may be more willing to engage with German and European impact companies in the energy sector. How much she’ll actually be free to pursue, is something to watch.

4. EU announces €52m for renewables projects in Finland and Estonia

The news: The commission announced late last week that €52m will be released via the EU Renewable Energy Financing Mechanism (RENEWFM) for solar and wind projects in Finland and Estonia.

What happens now: The projects, which are expected to add capacity of around 445.65 MW of renewable energy, are to be commissioned between 2027 and 2028.

What it means for impact companies and investors: Unambiguously good news. RENEWFM was set up in 2020, expressly to build up capacity and uptake of renewables around Europe. This funding – though it goes directly to pre-existing operators – will add to the availability of renewables, and that in itself is expected to expand demand.

5. EU's flagship research and innovation programme to be made more accessible

The news: The Commission is trumpeting the interim success of Horizon Europe, the €93.5bn fund for research and innovation in Europe, and has said it will take steps to simplify the application and implementation processes, as well as using initiatives like the Start-up and Scale-up Strategy to help home-grown companies build further.

What happens now: Horizon Europe has already been up and running since 2021, while the Start-up and Scale-up Strategy is still in its consultation phase, so we have to wait and see when these simplifications are implemented.

What it means for impact companies and investors: This goes right to the heart of the European impact community. Almost €100bn for research and innovation projects around Europe – many of them targeting climate and environmental transformation, as well as health and social projects. The budget is about halfway spent across roughly 15,000 projects already, but that still leaves a lot of money on the table for the next generation of impact projects to get up and running. If you have any thoughts on this round-up, what should or should not be in here, or you want to reach out with a tip of your own, feel free to get in touch – editorial@loop.se.