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Luxembourg's Integrated National Energy and Climate Plan for 2021

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LUXEMBOURG’S INTEGRATED NATIONAL ENERGY AND CLIMATE PLAN FOR 2021-2030 In accordance with REGULATION (EU) 2018/1999 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 11 December 2018 on the Governance of the Energy Union and Climate Action, amending Regulations (EC) No 663/2009 and (EC) No 715/2009 of the European Parliament and of the Council, Directives 94/22/EC, 98/70/EC, 2009/31/EC, 2009/73/EC, 2010/31/EU, 2012/27/EU and 2013/30/EU of the European Parliament and of the Council, Council Directives 2009/119/EC and (EU) 2015/652 and repealing Regulation (EU) No 525/2013 of the European Parliament and of the Council Final version Table of contents 1. Overview and process for establishing the plan 7 1.1. Summary 7 1.2. Overview of current policy situation 14 1.3. Consultations and involvement of national and Union entities and their outcome 18 1.4. Regional cooperation in preparing the plan 23 2. National objectives and targets 31 2.1. Decarbonisation dimension 32 2.1.1. Greenhouse gas emissions and removals 32 2.1.2. Renewable energy 32 2.2. Energy efficiency dimension 37 2.3. Energy security dimension 45 2.4. Internal energy market dimension 47 2.4.1. Electricity interconnectivity 47 2.4.2. Energy transmission infrastructure 47 2.4.3. Market integration 48 2.4.4. Energy poverty 49 2.5. Research, innovation and competitiveness dimension 51 3. Policies and measures 54 3.1. Decarbonisation dimension 54 3.1.1. Greenhouse gas emissions and removals 54 3.1.2. Renewable energyn 82 3.1.3. Other elements of the dimension 93 3.2. ‘Energy efficiency’ dimension 100 3.3. ‘Energy security’ dimension 111 3.4. ‘Internal energy market’ dimension 116 3.4.1. Electricity infrastructure 116 3.4.2. Energy transmission infrastructure 118 3.4.3. Market integration 118 3.4.4. Energy poverty 122 3.5. ‘Research, innovation and competitiveness’ dimension 124 4. Current situation and projections with existing policies and measures 131 4.1. Projected evolution of main exogenous factors influencing energy system and GHG emission developments 132 Luxembourg’s integrated national energy and climate plan for the period 2021-2030 | 2 4.2. ‘Decarbonisation’ dimension 135 4.2.1. GHG emissions and removals 135 4.2.2. Renewable energy 137 4.3. ‘Energy efficiency’ dimension 140 4.4. ‘Energy security’ dimension 151 4.4.1. Analysis – electricity sector 151 4.4.2. Analysis – gas sector 153 4.5. ‘Internal energy market’ dimension 156 4.5.1. Electricity interconnectivity 156 4.5.2. Energy transmission infrastructure 157 4.5.3. Electricity and gas markets, energy prices 159 4.6. ‘Research, innovation and competitiveness’ dimension 161 5. Impact assessment of planned policies and measures 164 5.1. Impacts of the planned policies and measures described in Section 3 on the energy system and greenhouse gas emissions and removals 165 5.1.1. GHG emissions and removals 165 5.1.2. Energy demand 167 5.1.3. Renewable energy 174 5.2. Impacts of the planned policies and measures described in Section 3 on the economy, employment and social conditions, environment and health 178 5.2.1. Estimation of macroeconomic consequences 178 5.2.2. Environmental/health impact 183 5.3. Overview of investment needs 185 5.3.1. Investments in energy efficiency 185 5.3.2. Investment and support requirements for renewable energy 187 5.3.3. Impact on network costs in the distribution network 188 5.4. Impacts of the planned policies and measures described in Section 3 on other Member States and regional cooperation 190 Luxembourg’s integrated national energy and climate plan for the period 2021-2030 | 3 List of tables and figures Figures Figure 1: Annual final energy savings in GWh in private households, the trade, commerce and services sector, industry and the transport sector in Luxembourg (based on an energy efficiency target of 44%) ..... 39 Figure 2: Cumulative final energy savings over the period 2021 to 2030 in GWh in private households, the trade, commerce and services sector, industry and the transport sector in Luxembourg (based on an energy efficiency target of 44%).................................................................................................................. 40 Figure 3: Annual final energy savings in GWh from the renovation of all residential and non-residential buildings in Luxembourg (based on an energy efficiency target of 44%) .................................................... 41 Figure 4: Cumulative final energy savings over the period 2021 to 2030 in GWh from the renovation of all residential and non-residential buildings in Luxembourg (based on an energy efficiency target of 44%) ...... 42 Figure 5: Annual final energy savings in GWh from the renovation of public buildings in Luxembourg (based on an energy efficiency target of 44%) ............................................................................................ 42 Figure 6: Cumulative final energy savings over the period 2021 to 2030 in GWh from the renovation of public buildings in Luxembourg (based on an energy efficiency target of 44%) ......................................... 43 Figure 7: Luxembourg’s final energy demand in 2016, broken down by industrial; household; trade, commerce and services; transport and agricultural sectors ..................................................................... 141 Figure 8: Final energy demand in Luxembourg in 2016, broken down by energy source ......................... 141 Figure 9: Electricity and fuel required by industry (ETS sector only) in the period from 2015 to 2040 in the event of the reference scenario ................................................................................................................ 145 Figure 10: Sectoral development of the fuel required for heat generation by households; trade, commerce and services, and industry (without ETS share) in the period from 2015 to 2040 in the event of the reference scenario .............................................................................................................................. 146 Figure 11: Development of the final energy demand (broken down by energy source) of the transport sector in the period from 2015 to 2040 in the event of the reference scenario ....................................... 147 Figure 12: Development of electricity demand (final energy demand and primary energy demand) for the period from 2015 to 2040 in the event of the reference scenario ............................................................ 149 Figure 13: Sectoral breakdown of the electricity demand for the period from 2015 to 2040 in the event of the reference scenario .............................................................................................................................. 150 Figure 14: Cartographic representation of Luxembourg’s supply situation .............................................. 158 Figure 15: Electricity price components for household customers ........................................................... 162 Figure 16: Gas price components for household customers ..................................................................... 163 Figure 17: Development of final energy demand in the period 2020 to 2040 in the case of the target scenario, broken down by sector .............................................................................................................. 168 Luxembourg’s integrated national energy and climate plan for the period 2021-2030 | 4 Figure 18: Sectoral breakdown of the electricity demand for the period from 2015 to 2040 according to the target scenario ................................................................................................................................ 169 Figure 19: Reduction in final energy demand (fuels, electricity) within the target scenario broken down by sector for the period 2020 to 2040 ............................................................................................ 170 Figure 20: Absolute change in key macroeconomic indicators when compared with the reference in €million2016 (source: Fraunhofer ISI) .......................................................................................................... 179 Figure 21: Investments to increase energy efficiency in the period 2020 to 2040, broken down by sector ... 185 Figure 22: Investments in e-mobility charging infrastructure in the period 2020 to 2040 in euro .... 186 Tables Table 1: Sectoral shares of renewable energy in Luxembourg up to 2040 according to the target scenario with the upper range value of 25% (in 2030). ............................................................................... 33 Table 2: Technology-specific energy generation from renewable energy in Luxembourg up to 2040 according to the target scenario with the upper range value of 25% (in 2030). ......................................... 34 Table 3: Key target figures of the target scenario in the area of energy efficiency based on the upper range value of 44% ...................................................................................................................................... 38 Table 4: Population growth and gross domestic product .......................................................................... 132 Table 5: Assumptions on energy price trends ........................................................................................... 133 Table 6: Assumptions on cost developments for renewable energy technologies ................................... 134 Table 7: Greenhouse gas emissions by sector for 2005 to 2017, in kt
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