REPower EU strategy accelerates the green transition

In response to Russia's invasion of Ukraine, the European Commission has published its REPower EU plan to address the current price and security crisis. The Commission's plan increases the pace of the green transition and confirms that the path to sustainability and security lies in an accelerated transition to renewables.

Massive investment in green projects is one of the key pillars of the plan. Achieving the REPower EU targets will require an additional investment of €210 billion from private and public sources until 2027.

More than half of this will be directed to renewable energy and hydrogen infrastructure projects. Around a fifth will go towards transforming the business away from fossil fuels. 

"The green transformation is a pragmatic step for business. We can fully see that fossil fuel energy prices have the biggest impact on companies that do not invest in energy savings and renewables," comments Filip Gregor from Frank Bold, who is directly involved in the development of European sustainability reporting standards.

He says companies can prevent further risks by proactively addressing their own transformation within a changing economy. "Reporting ESG sustainability data will help companies to better access finance and be more competitive," Gregor adds.

Companies that take a proactive approach to the transition are able to save on energy costs by investing in renewables, while also having better access to private financing and subsidies. For example, the Czech part of the international company Lidl recently managed to obtain tens of millions CZK from the Czech Modernisation Fund for the installation of rooftop PV panels. 

The benefits of focusing on sustainability are demonstrated, for example, by the Dutch company CTP, which issued a €700 million green bond backed by BREEAM sustainable building certification in early 2022, securing cheaper access to capital.

Do you want to seize the green transformation opportunity and wish to have more information? Get in touch. 

Unsustainable businesses will miss the boat

Although the EU's REPower package focuses primarily on the energy sector, it also plans to support an accelerated requalification of the workforce towards green skills, and boost value chains for the production of key materials and technologies linked to the green transition.

Overall, the Commission's plan confirms that the Russian war in Ukraine has not undermined the objectives of the Green Deal, but rather reinforced them, and that the pace of the green transition will accelerate. For example, Germany has already moved its target of 100% renewable energy supply five years ahead: the 2040 target has become the 2035 target.

The EU was recently urged to accelerate the transition in an open letter by more than 100 European business leaders. Businesses see the transformation of the economy as both an opportunity and a necessity to move away from dependence on Russia.

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The renewable energy boom is upon us

The main measures of the EU REPower Plan include energy savings, diversification of energy supplies, and an accelerated roll-out of renewable energy:

• - 13% of electricity consumption by 2030 (compared to the original target of 9%) 
• 45% energy from renewable sources by 2030 (against an initial target of 40%)
• more than doubling the installed capacity of solar power plants by 2028
• solar panels on all suitable public and commercial buildings by 2025, on new residential buildings by 2029
• anchoring renewable energy projects as a public interest and reducing the length of permitting processes
• increased use of heat pumps, geothermal energy, and solar collectors
• a "drastic acceleration" of the construction of wind power plants
• an obligation for states to designate areas for renewable energy development within one year
• accelerating the use of hydrogen in the energy sector
• ensuring a sufficient supply of raw materials for the production and development of renewables in the EU