As the EU Commission prepares to present its “Fit for 55” legislative package, the European CEO Alliance has issued policy recommendations supporting a progressive and ambitious push to achieve climate neutrality.
The alliance announced that it would welcome a review of the EU’s major regulatory instruments, in particular subsidies for technologies with high CO2 emissions. The CEOs’ proposals include sending a strong carbon pricing signal, accelerating measures to decarbonise mobility and transport, facilitating the transformation of the buildings sector and speeding up the restructuring and renewal of the energy system in all EU member states.
One of the members of the alliance, E.ON CEO Leonhard Birnbaum, said: “With the unique cross sector and cross country CEO Alliance we are able to make a difference. Our project within the CEO Alliance aims to establish European-wide markets for green hydrogen and its derivates, that makes green hydrogen the second energy carrier of the energy transition. With renewable energies in particular, in addition to the non-electrifiable applications, we are often faced with the fundamental challenge: They are available only when wind and sun allows.
“With hydrogen as an energy carrier, we can store green energy and transport it to places where it is needed in hard to abate sectors, for example for the production of climate-neutral, so-called “green steel.” Green hydrogen can also contribute to decarbonisation in the heating sector, distributed via the widely ramified gas network. By using hydrogen, we are giving the process of decarbonisation a significant boost.”
Alliance members proposed a strong carbon price signal to achieve the EU’s climate targets. Carbon should have a price, no matter in which sector it is emitted. The alliance also called for continued enhancement of the EU’s Emissions Trading System (for power and heavy industry) and for the implementation of additional sector-specific cap-and-trade systems that would apply to mobility, transport and the buildings sector. Sector-specific systems could then converge beginning in 2030. Another proposal concerns a European carbon pricing system that would include measures to simultaneously achieve a social balance and emissions reduction.
Turning its attention to the EU Commission’s Buildings Renovation Wave, the alliance supported ambitious annual renovation targets to accelerate the sustainable transition of the building stock, in particular decarbonisation. All new buildings should meet high standards regarding energy efficiency, renewables and sustainable materials. The Alliance also calls for fossil-fuel heating systems to be rapidly replaced by rolling out electric heat pumps, district heating and digital solutions. The CEOs are committed to applying this recommendation to their companies’ own buildings.
The Alliance brings together 12 top executives from the energy, transport and technology industries: Björn Rosengren (ABB), Thierry Vanlancker (AkzoNobel), Francesco Starace (ENEL), Leonhard Birnbaum (E.ON), Börje Ekholm (Ericsson), Henrik Henriksson (H2GreenSteel), Ignacio Galán (Iberdrola), Frans van Houten (Philips), Christian Klein (SAP), Christian Levin (Scania), Jean-Pascale Tricoire (Schneider Electric) and Herbert Diess (Volkswagen). McKinsey & Company is serving as a knowledge contributor for the CEO Alliance and is providing additional research and data.
