What financing is needed for the energy transition?
To reach these objectives, States must implement the energy transition in all sectors of activity (transport, buildings, communities, industry). The platform developed by Energisme supports actors towards this transition by helping them to improve their energy performance and to integrate renewable energies. But how can we finance the energy transition?
Who is financing the energy transition?
- Les objectifs de la transition énergétique
- Une transition massivement financée par l’Union Européenne
The objectives of the energy transition
Global agreements make the energy transition a priority in the fight against global warming.
The energy transition is based on two major levers:
- The progressive replacement of fossil fuels by an energy mix that favors renewable energies (RE)
- The improvement of energy performance: reduction of energy consumption, energy renovation of buildings
France, has set specific objectives through the law on the energy transition for green growth:
- Reduce greenhouse gas emissions by 40% between 1990 and 2030 and divide greenhouse gas emissions by four between 1990 and 2050
- Reduce final energy consumption by 50% in 2050 compared to 2012 with an intermediate target of 20% in 2030
- Reduce primary consumption of fossil fuels by 30% in 2030 compared to 2012
- Increase the share of renewable energy to 32% of gross final energy consumption in 2030
- To reach an energy performance level in accordance with “low consumption building” standards for the entire housing stock by 2050
A transition largely financed by the European Union
To become a reality, the energy transition requires the joint mobilization of citizens, companies, local authorities and the State. It also requires a massive investment plan in certain sectors, such as the energy renovation of buildings or the decarbonization of the industrial sector.
This is why the European Union has set up the Just Transition Fund (JTF). This fund aims to support territories in the energy transition.
It is used to finance:
- investments in renewable energy and energy storage technologies
- investments in energy efficiency and heat production for district heating based on renewable energy
- intelligent and sustainable local mobility
- Research and innovation efforts towards energy transition
Which fields are concerned by the financing of the energy transition in the EU?
The JTF aims to implement the priorities defined in the Green Pact for Europe, which defines an action plan for energy transition.
Decarbonizing the industry involves several types of measures:
- Gradually replacing fossil fuels with an energy mix that includes renewable energies in order to reduce greenhouse gas emissions
- Improving the energy performance of industrial sites through energy renovation and the implementation of an energy management system
- Developing energy capture and storage technologies
These measures are not only aimed at achieving the energy transition of the industrial sector, but they also constitute a competitive challenge for the companies concerned. In the medium and long term, decarbonization will be an imperative, and companies that are ahead of the game will have a competitive advantage. Nevertheless, the investment required to achieve the carbon trajectory objectives is substantial, especially in heavy industry where some processes are energy intensive.
In order to combine ecological and economic issues, industrial companies need to accurately monitor their carbon footprint. The platform developed by Energisme facilitates the collection, analysis and use of data for better management. It also allows actors to perform simulations on different scenarios and to estimate the profitability of alternative processes.
At the European level, the building sector represents 40% of energy consumption and 36% of CO2 emissions.
Consequently, European funding contributes to support efforts in energy efficiency in buildings:
- Systematic monitoring of the energy performance of buildings
- Energy renovation of existing buildings
- Zero carbon objective for new buildings
Energisme’s platform supports actors in monitoring and optimizing their energy efficiency. By offering them a better control of the data, it allows them to perform an in-depth energy analysis, to follow their trajectory in relation to the regulatory objectives or to evaluate the impact of energy renovation measures.
Increasing the share of renewable energies in the energy mix is a major challenge of the energy transition. By making energy data interoperable, the Energisme platform promotes communication between consumers and energy suppliers.
The creation of smart grids facilitates the integration of renewable energies into the mix. Indeed, the smart grid relies on data to adjust electricity flows to actual needs. It thus responds to the intermittent nature of certain renewable energies such as solar and wind power.
An investment of 17.5 billion euros over 6 years
Through the agreement on the establishment of the Just Transition Fund (FTJ), the European Union has acquired significant resources to achieve its energy transition objectives.
The amount of the FTJ is indeed 17.5 billion euros for the period from 2021 to 2027.
This ambitious scheme demonstrates the European Union’s willingness to support all actors working for the energy transition.
Some companies can also benefit from the Energy Savings Certificates (CEE). These are bonuses, subsidized loans or free diagnoses supervised by the State to help you achieve energy savings. These aids are accessible to all without any condition of resources.
In your efforts to optimize energy performance, you can therefore, under certain conditions, benefit from public funds related to the energy transition. This is an element to be taken into account when you evaluate the profitability of different provisional scenarios.