Fit For 55, the Energy Transition & the Montel Group
The Fit for 55 package launched by the EU Commission shows how the bloc intends to reach its 2030 emissions targets. At the centre are market-based instruments and robust targets. We explain how Montel Group can help you follow the legislative process and prepare for the future.
This blogpost is authored by a member of Montel's content marketing team.
Last week the EU Commission released the much anticipated “Fit For 55” legislative proposal, covering the measures that will need to be taken to reach the legally binding target of a 55% reduction in carbon emissions (compared to 1990 levels) by 2030.
This is the first step of a long legislative process which will first see the European Council , and eventually the European Parliament, consider which of the proposals to adopt and how to implement them. So, whilst this isn’t yet a definitive statement, it’s certainly a strong indication of how the bloc intends to tackle emissions strategy.
The key points of the package include:
A separate ETS for buildings and transport (including end of aviation exemption), to be integrated into the existing ETS in the next decade.
Inclusion of imported goods under carbon pricing regime through the Carbon Border Adjustment Mechanism (CBAM), essentially an import tax.
Increased targets for renewable energy in EU mix, to 40% by 2030 (the current target is 32%).
Removal of aviation and shipping energy taxation exemptions.
Targets designed to help phase out combustion engine cars.
Support for sustainable fuels such as hydrogen and synthetic aviation fuel.
These proposals have already generated both praise and criticism, as might be expected. There’s concern that they place too much of a burden on consumers (the inclusion of transport and buildings under the carbon pricing scheme), and that the CBAM will do little to help with global inequalities. Others have praised the package’s ambition, even as they underline the need to get the details right.
What’s clear at this stage is that the EU intends to continue with a hybrid approach to emissions policy: robust targets and expansive measures, combined with market-based instruments.
Across the Montel Group, we have put the energy transition at the centre of our business. Fit for 55 goes beyond legislation and targets - it’s changing the way energy markets work - so our services, from news to data, fundamentals to AI projections, optimisation tools to advisory services, are all designed to help our customers navigate this new era for energy.
The EU intends to continue with a hybrid approach to emissions policy: robust targets and expansive measures, combined with market-based instruments."
You can stay up to date with the legislative process through Montel Online, helping you break down the details of the Fit for 55 Package as it moves towards implementation. Our dedicated Green Desk and weekly Energy Transition Newsletter means you'll never miss an important development. You can also track the carbon market as it reacts to these changes through our data services and visualisations.
If you’re looking for advice on how you can make Fit for 55 and the Energy Transition work for your business, then our advisory services might be for you. Our experts bring together several lifetimes worth of experience, covering subjects including decarbonisation strategy and green markets.
With the emission trading scheme remaining at the centre of EU emission policy, the carbon market will become increasingly important for an increasing number of actors. If you want to understand how the carbon price will affect your margins, take a look at price(it)’s Price Forward Curves.
With the emission trading scheme remaining at the centre of EU emission policy, the carbon market will become increasingly important."
We don't yet know what the Fit for 55 package will end up looking like once it's implemented. What we do know is our role at Montel Group: providing you the information you need to ensure your business is ready for it.