Intro

The EU effort sharing legislation is one of the key policy instruments of the EU’s climate and energy policy to achieve domestic and international climate targets, alongside the EU Emissions Trading System (EU ETS) and the Land Use, Land Use Change and Forestry (LULUCF) Regulation. It aims to cut greenhouse gas (GHG) emissions from a wide range of sources, such as petrol and diesel use for road transport, energy use for heating and cooling in households and commercial buildings, animal digestion and fertiliser use in agriculture, waste treatment and small industries. Altogether, these emissions make up about 60 % of total GHG emissions at the EU level. The Effort Sharing Regulation (ESR), adopted in 2023, includes the target to reduce these emissions in 2030 by 40% compared to 2005 levels in the EU, with Member States contributing through specific binding national targets.

What the data are telling us

• In 2021, effort sharing sector emissions were 14% below 2005 levels, largely driven by improvements in energy efficiency and the switch to less carbon-intensive fuels for heating and cooling, including renewable energy sources. Preliminary estimates for 2022 indicate a further 3 % reduction.
• While the collective reduction by the EU Member States successfully surpassed the EU’s GHG emission target for 2020, emission reductions in all effort sharing sectors need to accelerate if they are to contribute adequately towards the EU’s 2030 emission reduction target. Compared with the period since 2005, average annual reductions must more than triple to achieve the 2030 target.
• Progress towards 2030 targets is diverse at national level. In 2021, all except five Member States (Austria, Cyprus, Denmark, Ireland and Italy) had emission levels in effort sharing sectors lower than their respective annual targets. For 2022, preliminary estimates indicate that nine Member States had Effort Sharing emissions above their targets (Denmark, Italy, Hungary, Croatia, Ireland, Romania, Cyprus, Lithuania, Malta).

In 2021, emissions under the effort sharing legislation were 14% lower than in 2005, with the buildings sector accounting for the largest reduction (-21%). Measures to improve energy efficiency and the switch to less carbon-intensive fuels for heating and cooling, including renewable energy sources, contributed most to this reduction. Over the same period, the transport (-8%) and agriculture (-3%) sectors saw more modest reductions. For transport emissions a wide range of measures can help to reduce emissions, for instance, improving vehicle efficiency, using low-carbon fuels and electric vehicles, a shift in transport modes and improving transport systems. Support for farms addressing methane emissions from livestock, as well as organic farming and requirements on fertiliser use, are examples of measures that could help reduce emissions from agriculture.

Provisional figures for 2022 suggest a further decrease in total Effort Sharing GHG emissions by 3% compared to 2021, with buildings once again responsible for the largest reduction (-9%). At the same time, emissions from the transport sector increased (+3%).

With the amendments to the Effort Sharing Regulation adopted in 2023, the EU-level GHG reduction target for 2030 increased from 29% to 40%, compared with 2005 levels; the emission limits for each year up to 2030 are also tightened. This implies that in the upcoming years, emissions will need to decline at a significantly faster pace than the reduction rate observed in recent years. Based on projections submitted by Member States in March 2023, current policies and measures will not be sufficient to achieve this acceleration. Existing measures are projected to reduce GHG emissions covered by the Effort Sharing legislation by 26% by 2030. When considering the additional planned measures, the projected reduction reaches 32%.

The ESR sets national targets for the reduction of GHG emissions in the Member States by 2030. These range from a 50% reduction compared to 2005 for some countries to a 10% decrease for others. Member States are also subject to gradually decreasing annual emission limits for each year from 2021 to 2030. The annual progress towards the national targets under the Effort Sharing Legilsation is assessed by comparing effort sharing sector GHG emission levels with the relevant annual targets under the legislation. To achieve compliance under the ESR, Member States are permitted to use flexibility options to a certain extent, such as carrying forward (i.e. ‘borrowing’) emission allocations (AEAs) from the following year,carrying over any surplus AEAs from a previous year or buying emission allocations from other countries.