The COP29 panel “EU climate policies and justice: socio-economic impacts and pathways to equity”, scheduled on Friday 15 November 2024 from 10:00 to 11:00 AZT, will investigate some potential socio-economic effects of a set of European climate policies in the EU and in the rest of the world.

The EU’s European Green Deal (EGD) includes ambitious climate policies like the Emissions Trading Systems (ETS, ETS 2) and the Carbon Border Adjustment Mechanism (CBAM) to reduce emissions and prevent carbon leakage. However, these policies risk creating socio-economic inequalities, particularly affecting low-income households and workers in high-carbon industries. Without fair redistribution mechanisms, these communities face higher energy and transport costs, job losses, and social exclusion.

Key discussions are needed around social safeguards, including funding for the Social Climate Fund, strengthening the Just Transition Mechanism, and ensuring CBAM’s fairness for Global South countries. Addressing these issues is essential to achieving a just transition that supports vulnerable populations and fosters equitable global climate action.

The Official Side-Event will be hosted by the ILO in its Pavilion during the 29th Conference of Parties in Baku, Azerbaijan. You may follow the live stream here.

Chair and Introduction:

• Simone Borghesi, FSR Climate, EAERE & University of Siena

Panel Discussion:

• Frank Siebern-Thomas, DG EMPL
• Bas van Ruijven, IIASA
• Moustapha Kamal Gueye, ILO
• Asia Guerreschi, University of Ferrara

The event is organised by EUI-FSR in coordination with the consortium of the Horizon Europe project SPES and in collaboration with DG EMPL.

Dive deeper into the topic:

• Read the FSR-EUI deliverable 7.1 from the SPES project on EU ETS and EU ETS2.
• SPES project publications here.

SPES is funded by the Horizon Europe Programme of the European Union, Grant Agreement No. 101094551.

• How can EU effectively support and retain its energy-intensive industries?
• Is the CBAM effective? What reforms could enhance its role in safeguarding EU industry?
• Do existing trade policy tools adequately shield against unfair competition? If not, what measures should be considered?
• A reform of State aid is announced. What are the concrete changes that are needed?
• What additional actions are required to enable the EU to decarbonise and to retain energy intensive industry, especially in strategic sectors?

• Adina Georgescu, Eurometaux
• Markus Kerber, former CEO of BDI
• Ronnie Belmans, KU Leuven
• Ioana Petcu, Eurelectric

What is the best way to prevent capacity remuneration mechanisms (CRMs) of individual EU Member States from generating negative externalities in their neighbours?

Join us for the third and final instalment of the FSR Insights series’ quarterly theme “Securing Europe’s Energy Future”

Emma Menegatti, PhD candidate with the Loyola De Palacio Chair at the FSR, will present her working paper, co-authored with the FSR Director, Leonardo Meeus.

The paper models four types of externalities that the adoption of a capacity market can generate on a neighbouring energy-only electricity market zone, and compares the impact of three different approaches to cross-border participation: no participation, implicit participation, and explicit participation.

The webinar aims to shed light on the potential of cross-border participation in solving the cross-border issues caused by national capacity markets. This is a timely discussion, as CRMs are no longer seen as just a temporary or last-resort solution for security of supply issues. Instead, the latest EU market reforms recognize CRMs as a structural element of the electricity market.

Nevertheless, Member States willing to adopt a CRM must notify the European Commission (EC) and get state aid rules cleared. Following the 2024 Electricity Market Design reform, the EC is required to publish a report in early 2025 on streamlining and simplifying the process for applying for a capacity mechanism.

Derek Bunn, professor at the London Business School, and Eline Spyrou, lecturer at the Imperial College of London, will provide commentary on Emma Menegatti’s presentation, enriching the conversation with diverse perspectives. Moderated by Nicolò Rossetto and Marzia Sesini from FSR, the session will invite audience participation, encouraging an engaging and thought-provoking dialogue.

Keynote Speaker

Emma Menegatti | FSR

Discussants

Derek Bunn | London Business School

Eline Spyrou | Imperial College London

Moderators

Marzia Sesini | FSR

Nicolò Rossetto | FSR

The COP29 panel “Enhancing NDCs 3.0: The Role of Carbon Markets in Emission Reductions and Removals”, scheduled on Friday 15 November 2024 from 11:30 to 13:00 AZT, will explore different pathways to enhance NDCs through carbon markets.

Nationally determined contributions (NDCs) are at the heart of the Paris Agreement as they reflect domestic efforts to reduce emissions and adapt to climate change. Progressively more ambitious NDCs are submitted every 5 years to the United Nations Framework on Climate Change Convention (UNFCCC) Secretariat with the next submission coming up in February 2025. To update their NDCs, Parties need to consider further emissions reductions and removals. Carbon markets have the potential to drive mitigation actions through domestic policies and international cooperation and could, therefore, play an increasingly important role in the NDCs.

The Official Side-Event will be hosted by the UNFCCC in Room 6 during the 29th Conference of Parties in Baku, Azerbaijan. It is organised by FSR, ICAP, Seoul International Law Academy and Tsinghua University.

Chair: Simone Borghesi, EUI, Siena University & EAERE

Introductory remarks:

• Li Gao, Environment and Resources Protection Committee of the National People’s Congress, China

Scene-setting presentations:

• Simone Borghesi, EUI, University of Siena & EAERE [slides]
• Stefano De Clara, ICAP [slides]
• Xiliang Zhang, Tsinghua University [slides]

Panel:

• Suh-Yong Chung, Korea Uni & SILA
• Teng Fei, Tsinghua University
• Xiaolu Zhao, EDF
• Leticia Guimarães, UNDP

Conclusions:

• Jan Dusik, European Commission

The event is organised by the EUI, ICAP, Tsinghua University and SILA and is held in the framework of the project LIFE COASE.

Removing greenhouse gas emissions from the atmosphere is essential to maintaining the temperature increase below 2 degrees above the pre-industrial levels. However, a policy gap exists in incentivising investment in carbon removal technologies. Since emissions trading systems are considered a cost-effective solution to drive technological change, can emissions trading promote carbon removals?? How can carbon removals fit into a climate policy mix that targets net zero emissions?

These and other questions will be addressed during the panel discussion “Can emission trading systems be employed to promote carbon removals?” on Tuesday 12 November from 09:30 to 11:00 AZT at the Italian Pavilion of the 29th Conference of the Parties (COP29) in Baku, Azerbaijan.

Chair and Introduction:

• Simone Borghesi,  FSR Climate, EAERE & University of Siena

Panel Discussion:

• Robert Jeszke, KOBIZE
• Luca Taschini, University of Edinburgh
• Stephanie La Hoz Theuer, ICAP
• Lorna Ritchie, ICVCM

Concluding Remarks:

• Ottmar Edenhofer, PIK & MCC

The event is organised by the EUI with the support of ICAP and is held in the framework of the project LIFE COASE.

Dive deeper into the topic:

• Read the event highlights from the latest LIFE COASE policy dialogue.
• ICAP report “Emissions Trading Systems and Net Zero: Trading Removals“, May 2021

Join this online event to learn more about agriculture-related issues at the intersection of the FSR agenda on energy, climate, and sustainability, and explore the policies and regulatory regimes that can support sustainable agricultural trade.

The Strategic Dialogue on the Future of EU Agriculture has emphasised the importance of promoting sustainability and competitiveness in trade policy.

This webinar aims to highlight the critical importance of sustainable agricultural trade and its benefits for the environment, society, and the economy.

The panel includes representatives from EU institutions, academia, and international organisations who will address the coherence between trade and sustainability policies while reviewing approaches to trade negotiations that recognize the strategic importance of agriculture in international trade.  A comparative analysis of the EU regulatory regime will also be featured. Furthermore, participants will discuss effective strategies and interventions to promote sustainable practices, including the adoption of trade measures, standards, certifications and labels. Lastly, this webinar will emphasise the role of collaboration among farmers, traders, policymakers, and consumers in driving change. By the end, participants will be equipped with actionable knowledge to support sustainable agricultural trade and contribute to a more resilient and equitable food system.

This online event is designed for businesses, trade associations, farmers’ organisations, scientists, and policy analysts. Through expert discussions and case studies, attendees will gain insights into best practices and innovative solutions for fostering sustainability in agriculture as part of the broader climate agenda.

Speakers

Flavio Coturni | DG TRADE

Rob Vos | IFPRI

Susan Stone | University of South Australia

Jukka Likitalo | EUCOLAIT

Ignacio Sanchez Recarte | CEEV

Moderator

Alessia Casamassima | FSR Climate – EUI

Chair

Fabio Santeramo | EUI & University of Foggia

The REPowerEU Communication, published by the European Commission in 2022, confirmed the previously set target of 10 million tons (Mt) of renewable hydrogen to be produced in the EU by 2030 and added a target of 10 Mt of imported renewable hydrogen on top of it. Still in 2022, hydrogen accounted for less than 2% of Europe’s energy consumption and was primarily used to produce chemical products, such as plastics and fertilisers.

In order to facilitate the market uptake of hydrogen and in particular its upscale to the international dimension, the Commission envisaged the development of three major hydrogen import corridors via the Mediterranean, the North Sea area and, as soon as conditions allow, with Ukraine; at the same time, it supported the development of Green Hydrogen Partnerships, to facilitate the imports of green hydrogen while supporting the decarbonisation in the partner countries.

Alongside the natural matching of demand with supply, and the development of the necessary infrastructure, what is further needed as to set the basis for an international trading of hydrogen, seems to be a robust system of reliable and mutually recognised certification system.

Worldwide certification systems are typically based on aligned understanding of terminology and standardization, as well as on trust.

The EU and the US seem to be the first movers on getting to an agreed set of rules/definitions. Regarding terminology, the European Commission enshrined in regulation the definition of renewable hydrogen (as belonging to the category of RFNBOs, Renewable Fuels of non-biological origin) and has recently opened a consultation aiming to complete the definition of low-carbon hydrogen. In the US, the Inflation Reduction Act (IRA) includes comparable rules focusing on hydrogen’s generation emission intensity.

On EU RFNBO Certification, the EU Commission is evaluating different types of certificates. These certification schemes can be used by a production company to serve the needs of its customers and want to offer products meeting certain sustainability criteria. However, these certificates are only voluntary at present. Identifying and implementing mandatory standards should probably become the very first step to advance international certification of hydrogen traded products.

If so, are there any best practises to build on? Where are the main bottlenecks?

Programme

Introduction to the Debate and Opening Presentations

14.00 – 14.05 Introduction to the Debate

Ilaria Conti | FSR

14.05 – 14.20 Certification Requirements in the EU

Ruta Baltause | DG ENER

14.20 – 14.30 Certification Requirements in the US

Chelsea Baldino | ICCT

Panel Discussion: Introductory Remarks, Polls and Comments

Moderator: Alberto Pototschnig | FSR

14.30 – 15.00 Introductory remarks from the panellists

Maximilian Kuhn | Hydrogen Europe

Peter Biltoft-Jensen | Ørsted, Energy Traders Europe

Katrien Verwimp | AIB

Nicolai Romanowski | CEFIC

Francisca Gallegos | University of Eastern Finland 

15.00 – 15.25

Discussion and Q&A with the audience

15.25 – 15.30 Concluding remarks

Ilaria Conti | Florence School of Regulation

Alberto Pototschnig | Florence School of Regulation

In this joint FSR-NYU episode of #FSRDebates, we explore Voluntary Carbon Markets (VCMs) as they have emerged as a mechanism for organizations and individuals to offset their carbon emissions by purchasing carbon credits. While they hold promise to contribute to global carbon reduction efforts, they face several challenges that hinder their effectiveness and credibility.

VCMs often lack a unified global regulatory framework, leading to inconsistencies in standards and methodologies across different markets. This fragmentation can result in differences in the quality and reliability of carbon credits. Transparency issues and insufficient verification mechanisms can lead to double-counting, overestimations of carbon reductions, and fraud.

Ensuring that projects genuinely contribute to carbon reductions is a significant challenge. Moreover, concerns exist about the social impacts of certain carbon offset projects, particularly those involving land use changes.

Addressing these and other challenges requires serious efforts to create a more transparent and equitable carbon market that can effectively contribute to global climate goals. Our discussions in this episode will carefully examine all these aspects. The tri-continental perspective the debate brings aims to help understand the complexities of VCMs and enrich ongoing discussions, facilitating informed decision-making across various sectors and disciplines.

Keynote Speaker

Nat Keohane | President, Center for Climate and Energy Solutions

Damien Meadows  | Legal and Policy Advisor, DG Climate Action

Debate

Peter Vis | Senior Adviser, Rud Pedersen Public Affairs, Brussels

Gregory Trencher | Kyoto University

Conclusions 

Simone Borghesi | FSR

Moderators

Marzia Sesini | FSR

Christoph Graf | NYU

The Net Zero Carbon Market Policy Dialogue (NZCMPD) brings together regulators, policymakers, academics, and stakeholders from different carbon markets worldwide on a yearly basis.  It is organised under the framework of the project, LIFE COASE – Collaborative Observatory for ASsessment of the EU ETS, which is co-funded by the EU Life Programme.  

The event offers a unique opportunity for fruitful exchange on carbon market development and integration related to net zero targets, regulation, development, and integration of carbon markets.  A background report from the LIFE COASE team will feed into the discussion at the policy dialogue and provide a basis for the discussion.   

The first session of the NZCMPD was held on 21 May 2024 in the context of the EUI Climate Week and discussed the 2024 State of Play in Carbon Markets. The upcoming sessions of the policy dialogue will focus on the opportunities, and challenges of extending carbon pricing to new sectors, the methodological issues relating to modelling the development of emissions trading systems, and considerations regarding the inclusion of domestic carbon removal in emissions trading systems.    

Participation is by-invitation only.    

11:30-11:35  Welcome by Simone Borghesi (EUI and University of Siena)

11:35-12:35  Opportunities and challenges of ETS sector expansion

14:00-15:00 Modelling for emissions trading: new frontiers

15:00-16:00 Integrating carbon removals in ETSs

This FSR Debate will discuss which hydrogen infrastructure vision is more likely to prevail in the period to 2030 and, more generally, what this implies for the development of the renewable/low carbon hydrogen sector.

Despite the fact that renewable and low-carbon hydrogen represents one of the pillars of the EU decarbonisation and system integration strategies, there is still significant uncertainty regarding how the sector will develop in the years to come and what this implies for the hydrogen transport infrastructure. In 2020 and again in 2022 the EU set goals for the production and import of renewable hydrogen. However, an agreed ‘target model’ for the nascent hydrogen sector is still to emerge. This might impact the development of the hydrogen transport infrastructure. Reference is often made to a ‘no-regrets’ network. But what would this be?

This FSR Debate will compare two visions – one mostly based on ‘hydrogen valleys’, similar to the current setting of the sector, and another one bases on the development of an EU-wide hydrogen backbone network- and discuss how they could contribute to a ‘no-regrets’ approach to the hydrogen network and what this implies for the development of the renewable/low carbon hydrogen sector.

Programme

Introduction to the Debate and Opening Presentations

14.00 – 14.05 Welcome to the Debate

Ilaria Conti | Florence School of Regulation

14.00 – 14.05 Introduction to the Debate

Alberto Pototschnig | Florence School of Regulation

14.05 – 14.20 the EU vision on hydrogen transport infrastructure

Lukas Wernert | Policy Officer, Decarbonisation and Sustainability of Energy Sources, DG Energy, European Commission

14.20 – 14.30 The regulatory perspective for the EU hydrogen transport infrastructure

Csilla Bartok | Head of Department, Gas, Hydrogen & Retail. ACER

Panel Discussion: Introductory Remarks, Polls and Comments

Moderator: Ilaria Conti | Florence School of Regulation

14.30 – 14.50 Introductory remarks from the panellists

María Sicilia | Chairwoman, European Hydrogen Backbone Initiative

Jorgo Chatzimarkakis | CEO, Hydrogen Europe (TBC)

Peter Claes | President, IFIEC Europe

Abel David Enriquez Rodriguez | Moderating Team, ENNOH Foundation Process  

Ralph Bahke | CEO, ONTRAS and Board Member, GIE 

14.50 – 14.55 Polls

14.55 – 15.20 Comments on the polls outcome and Q&A from the audience

Panellists

15.20 – 15.30 Concluding remarks

Ilaria Conti | Florence School of Regulation

Alberto Pototschnig | Florence School of Regulation

Background

Renewable and low carbon hydrogen is currently considered one of the pillars for the decarbonisation of energy demand. The 2020 EU System Integration Strategy1 included “the use of renewable and low-carbon fuels, including hydrogen, for end-use applications where direct heating or electrification are not feasible, not efficient or have higher costs” as one of the concepts to deliver low-carbon, reliable and resource-efficient energy services, at the least possible cost for society.

In 2022, hydrogen accounted for less than 2% of Europe’s energy consumption and was primarily used to produce chemical products, such as plastics and fertilisers. 96% of this hydrogen was produced from natural gas, resulting in significant amounts of CO2 emissions. Therefore, the 2020 EU Hydrogen Strategy2, unveiled at the same time as the System Integration Strategy, defined a roadmap for the development of renewable and low-carbon hydrogen. The Strategy set the priority for the EU to develop renewable hydrogen, while recognising that in the short and medium term other forms of low-carbon hydrogen are needed.

In terms of short-term ambition, the Hydrogen Strategy set strategic objectives:

• For the period to 2024, to install at least 6 GW of renewable hydrogen electrolysers in the EU for the production of up to 1 million tonnes of renewable hydrogen;
• For the period to 2030, to install at least 40 GW of renewable hydrogen electrolysers for the production of up to 10 million tonnes of renewable hydrogen in the EU, with an additional objective of 10 million tonnes imported from third countries later set by the REPowerEU Plan3.

Beyond 2030, “renewable hydrogen technologies should reach maturity and be deployed at large scale to reach all hard-to-decarbonise sectors where other alternatives might not be feasible or have higher costs”4.

Two visions for the development of the renewable/low-carbon hydrogen market and the supporting network are possible:

• One based on hydrogen valleys, i.e. local hydrogen clusters based on decentralised renewable hydrogen production and local demand, transported over short distances. This is the model currently prevailing.
• One based on an EU-wide hydrogen market, with “unhindered cross-border trade and efficient allocation of hydrogen supply among sectors”5.

The Hydrogen Strategy seemed to favour the second vision, at least for the 2030 horizon and beyond.

In order to support this vision, a suitable infrastructure is required:

• In the REPowerEU, the Commission indicated its intention to support the development of three major hydrogen import corridors via the Mediterranean, the North Sea area and, as soon as conditions allow, from Ukraine.
• An increasing group of energy infrastructure operators, under the European Hydrogen Backbone (EHB) initiative, have been looking at and proposing how a EU-wide hydrogen network could be developed, mostly by repurposing gas infrastructure no longer used in the future. The latest (EHB) report highlights a set of 40 projects managed by the EHB’s TSO members, representing 31.500 km of hydrogen pipelines with expected commissioning prior to 2030. By 2040, the backbone network should extend to close to 40,000 km. Two thirds of this network will consist of repurposed infrastructure.

Moreover, the 6th List of Project of Common Interest in 2023 included 65 hydrogen and electrolyser projects. Of these, 17 projects (some of which include several components) related to hydrogen transport infrastructures (although in some cases defined quite generically).

However, so far the hydrogen sector seems to be developing at the local level. All seven projects which were allocated support at the first auction of the European Hydrogen Bank earlier this year envisage the production of renewable hydrogen for local consumption (possibly for the production of ammonia), including in the same industrial complex6.

The regulators are also taking a cautious approach to the hydrogen network in Europe. Both at the 38th European Gas Regulatory Forum in Madrid in April and at the 10th Energy Infrastructure Forum in Copenhagen in June different views were expressed regarding which hydrogen network will be needed and by when. It seems that the sector is looking for a ‘no-regrets’ approach to the hydrogen network, which however risks of pushing the debate into a vicious circle. What such an approach will be depends on how much and where (renewable and low-carbon) hydrogen will be produced and consumed, or imported into the EU. This partially depend on the cost of producing such hydrogen. However, until it is clear which infrastructure will be available, it is unlikely that project beyond those with a local footprint will emerge.

What seems to be missing at the moment is a ‘hydrogen target model’, an agreed vision for the development of the hydrogen sector, in the same way as the ‘electricity target model’ and the ‘gas target model’, although very different in shape, guided the integration of the electricity and gas markets in Europe.

A separate, although related, issue is how any hydrogen network will be paid for. Regulation (EU) 1789/20247 allows, probably for the first time in modern European regulatory history, cross-subsidisation of the hydrogen infrastructure across time and from natural gas network users. The extent to which this cross-subsidisation is needed will depend on the size of the hydrogen network to be developed and the way in which it will be developed.

Road Safety – Making Use of Data Generated from Connected Vehicles for Public Interest

Background

Cooperative, Connected and Automated Mobility (CCAM) offers a unique opportunity to make the EU’s transport systems safer, cleaner, more efficient and more user-friendly. In its most advanced form, CCAM services use automated and connected vehicles, also known as self-driving cars and trucks, that can operate without human intervention. It prepares for the arrival of an entirely new generation of vehicles, unlocking opportunities and tools thanks to the data generated by these vehicles. The EU member states, industry, and the European Commission (EC) are collaborating to realize the EU’s ambitious vision for connected and automated mobility across the EU, considering the interests of public authorities, citizens, cities, and industry. The Sustainable and Smart Mobility Strategy (SSMS) stresses the importance of connected and automated systems for improving transport while contributing to enhanced sustainability and safety. The way vehicles operate is swiftly being integrated into the transport system, accompanied by policies and legislation pertaining to cybersecurity, liability, data use, privacy, and connectivity. However, vehicles can remain connected when crossing borders only if coordination exists at the European level. For example, Regulation (EU) 2019/2144 aims to reduce the number of deaths and severe injuries by introducing safety technologies as compulsory safety features that all new vehicles must be equipped with. Regulation (EU) 2022/1426 lays down rules for the application of Regulation (EU) 2019/2144 regarding uniform procedures and technical specifications for the type-approval of the automated driving system of fully automated vehicles.

Another relevant piece of legislation is the Data Act (DA). It is a horizontal Regulation that applies to business-to-business contracts. It is, therefore, also applicable to transport as data is becoming an integral part of efficient and safe transport systems. The DA increases legal certainty for transport companies, and consumers engaged in data generation by establishing clear rules on the permissible use of data and the associated conditions. At the same time, it mitigates the abuse of contractual imbalances. Finally, it enables public sector bodies to access and use data held by the private sector for specific public interest purposes. These interests go from refined urban planning to road and infrastructure management.

This 14^th Intermodal Florence Forum will discuss road safety and how to use data generated from connected vehicles to enhance it. The Forum, co-organised by the Transport Area of the Florence School of Regulation together with the EC’s DG MOVE, will tackle the following questions:

• Why is vehicle data needed to make roads safer? Why should public authorities be involved?
• What are the potential benefits and constraints when it comes to connecting vehicle data?
• What are the key use cases? Examples of Urban Planning and Road Asset Management.