Analysis of key trends and drivers in greenhouse gas emissions in the EU between 1990 and 2014

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Courtesy of European Environment Agency (EEA)

1 GHG emissions in 2014 compared to 2013

1.1 Summary (last year)
Total GHG emissions (excluding LULUCF) decreased by 185 million tonnes, or 4.1% compared to 20132 to reach their lowest level in 2014 (4282 Mt CO2 eq.). This significant decrease in emissions in 2014 came with an increase in GDP of 1.4 %. This resulted in a lower GHG-emission intensity of GDP in the EU in 2014, which can be attributed to the sharp decline in the consumption of heat and electricity. This was in turn triggered by the lower heat demand by households due to the milder winter conditions in Europe. The sustained increase in non-combustible renewables, particularly wind and solar, for electricity generation also contributed to lower emissions in 2014. Over 80 % of the total GHG emissions reduction in 2014 was accounted for by lower CO2 emissions from gas and solid fuels from thermal power stations as well as by lower CO2 emissions from gas in the residential and commercial sectors. Primary energy consumption declined overall, with fossil emissions decreasing for all fuels, particularly for natural gas, but also for hard coal and lignite. The consumption of renewables increased in terms of primary energy. This led to a further improvement of the carbon intensity of the EU energy system in 2014. Germany and the United Kingdom accounted for about 45% of the total GHG-emissions reduction at EU level in 2014.

1.2 Overall results at EU level
Total GHG emissions (excluding LULUCF) in the EU decreased again in 2014 reaching their lowest level since 1990 (4282 Mt CO2 eq.). In 2014, EU emissions were 4.1% below 2013 levels and accounted for a net reduction of 185 million tonnes of CO2-equivalents. Compared to 1990, total GHG emissions were 24.4% lower in 2014 (23% lower when including international aviation).

Figure 1 breaks down the 4.1% overall reduction in GHG emissions compared to 2013 into several factors using the Kaya decomposition identity3. Of these, the lower energy intensity of GDP played the biggest role (yellow section) in bringing emissions down, as the economy required less primary energy per unit of GDP. The carbon intensity of energy also improved in 2014 (red section), which reflects the lower use of very carbon intensive fuels like coal, and of fossil fuels in general, and an increase in the (primary) consumption of renewables. The two factors driving emissions down were partially offset by higher population and GDP as well as by a higher share of non-combustion (i.e. non-energy related) emissions in total GHG emissions.

Figure 1 Decomposition of the annual change in total GHG emissions in the EU-28 in 2014

Overall, the four main findings from the decomposition analysis of figure 1 are:

  1. The reduction of 4.1% in total GHG emissions came along with an increase in GDP of 1.4% in 2014, showing that emission improvements are not necessarily at odds with a growing economy4. As it will be shown, however, weather factors, which are independent of economic growth, are broadly responsible for the substantial reduction in emissions in 2014.
  2. The decrease in total GHG emissions was almost fully-driven by emission reductions in the energy sector, particularly in electricity and heat production and in the residential and commercial sectors. As explained below this was due to significantly warmer conditions in Europe in 2014 and by the increase in non-combustible renewables for electricity generation. The relative weight of non-combustion emissions, such as those from industrial processes, agriculture and waste, increased in 2014. For industrial processes and agriculture, emissions did increase in 2014.
  3. The lower carbon intensity of energy was a key factor underpinning lower emissions in 2014 in spite of the decline in nuclear electricity production. Fossil fuel consumption fell substantially for all fuels. Thus, the lower carbon intensity is by and large accounted for by a higher relative-contribution from renewable energy sources in the fuel mix. According to Eurostat, the share of renewable energy in gross final energy consumption (normalised to even out the annual variability in hydro and wind production) reached 16% in 2014, up from 15% the year before. In fact, the carbon intensity of fossil fuels for the whole energy-combustion sector (i.e. excluding renewables and nuclear) increased as gas consumption fell faster than coal consumption. Thus, the contribution from renewables, and the stagnation in nuclear electricity production, led to an overall improvement of the carbon intensity of energy production and use in the EU.
  4. The decrease in primary energy intensity was the largest contributing factor to lower GHG emissions. Total energy consumption decreased while GDP increased, leading to an improvement in the energy intensity of the EU economy as a whole. As it will be shown, this improvement in energy intensity was largely driven by lower heat demand. The improvement occurred in spite of a worsening of the energy efficiency of the overall EU economy due to the lower heat to electricity ratio. The lower efficiency was partly offset by an increase in non-combustible renewables, particularly from wind and solar electricity production, and in non-energy use. The moderate increase in gross value added in the industrial sector compared to pre-2008 levels, where growth was faster, also contributed to lower consumption of electrical output in 2014.

1.3 Largest emission changes by sector at EU level
We now look deeper into the sectors accounting for the largest reduction in emissions. These sectors were also the main contributors to the lower energy intensity and lower carbon intensity of the EU economy in 2014. Table 1 shows that the largest reductions in emissions occurred in electricity and heat production and in the residential and commercial sectors.

The combined CO2-emission reduction from these sectors represented around 94% of the total EU net-reduction in 2014. Why these sectors? The common denominator in both sectors is heat consumption, which is either distributed, such as in the case of main-activity electricity and heat production, or direct (heat) consumption in the case of residential and commercial.

Table 1 Overview of the largest emission changes by key sector in EU-28, 2013-2014

GHG inventories provide evidence of the fuel input and the emissions output from electricity and heat production, but without distinguishing between emissions from heat and from electricity. Solid fuels and natural gas accounted for the bulk of the reduction in fuel input to the energy-transformation process in 2014. The reduction in the consumption of solid fuels in the heat and power sector was twice as strong as the reduction in natural gas use. This lead to a sharp reduction in CO2 emissions from main-activity heat and electricity plants, which was 7.4% lower than in 2013 for the EU as a whole. The question is whether the trigger for such large reduction was lower heat output or electricity, or both.

According to energy statistics reported to Eurostat, there was a sharp decline in both heat output and electricity output from main-activity conventional thermal power stations (including district heating). The reduction in distributed/derived heat production was one of the largest of the past 24 years since 1990. The reduction in electricity production continues the downward trend that started in 2008 and can partly be explained by the sustained strong increase in electricity from renewable energy sources, particularly of wind and solar, as well as by moderate (as opposed to strong) economic activity in the industrial sector compared to pre-2008 levels. In addition, electricity in some countries is also used for heating purposes, so part of the reduction in electricity in 2014 may also be attributed to lower heat demand in these countries.

Most of the heat consumption in the EU is not supplied via distributed systems from thermal stations but occurs as a process of direct combustion in buildings. The consumption and emissions of the residential and commercial sectors reported in GHG inventories capture by and large the bulk of heat consumption and emissions from fossil fuels. The year 2014 represents both the lowest-ever heat consumption by households in the EU and the largest decline from year to year. Overall, the reduction in CO2 emissions in the residential and commercial sectors reached a staggering 15% in 2014.

It is worth noting that CO2 emissions from road transportation increased in 2014 after 6 years of consecutive reductions.

All in all, there is evidence that lower heat demand and consumption is one of the key reasons for the strong decrease in emissions in 2014. The continued increase in renewables for electricity generation also contributed to this decline in emissions as well as to lowering the dependence on fossil fuel generation.

1.4 Largest Member State contributions to the positive EU performance
Figure 2 shows the absolute change in total GHG emissions, excluding LULUCF, by Member State (MS) between 2013 and 2014. Emissions decreased in almost all Member States. Six MS [DE, UK, FR, IT, PL and NL] accounted for almost 85% of the EU total net reduction of 185 million tonnes of CO2 eq. in 2014. The two largest emission reductions occurred in Germany and the United Kingdom, which combined represented about 45% of the EU reduction in 2014. The main reasons for the decrease in emissions in Germany are linked to a substantial decrease in electricity generation, in spite of a positive export balance, the increase in renewables, particularly from wind and photovoltaics, and the milder weather conditions which led to lower heat demand in commercial buildings and homes. In the case of the UK, the strong reduction in emissions was primarily due to the extraordinary warm 2014 year, which reduced demand for heating, as well as to the increase in renewables for electricity generation.

Figure 2 Change in total GHG emissions, excluding LULUCF, between 2013 and 2014 by EU Member State [kt CO2 equivalent]

As shown in the previous section, the largest reductions in emissions at EU level occurred in electricity and heat production and in the residential and commercial sectors. A closer analysis at country level shows that the top 10 contributors to the reduction in GHG emissions in the EU in 2014 were: a) lower coal use in heat and electricity plants in DE, FR, UK and PL; b) lower use of natural gas in heat and electricity plants in IT; and c) lower use of natural gas in the residential sector in DE, FR, UK, IT and NL. All these together can explain almost 60% of the total reduction in EU emissions in 2014. This is shown in table 2.

Figure 2 Change in total GHG emissions, excluding LULUCF, between 2013 and 2014 by EU Member State [kt CO2 equivalent]

As shown in the previous section, the largest reductions in emissions at EU level occurred in electricity and heat production and in the residential and commercial sectors. A closer analysis at country level shows that the top 10 contributors to the reduction in GHG emissions in the EU in 2014 were: a) lower coal use in heat and electricity plants in DE, FR, UK and PL; b) lower use of natural gas in heat and electricity plants in IT; and c) lower use of natural gas in the residential sector in DE, FR, UK, IT and NL. All these together can explain almost 60% of the total reduction in EU emissions in 2014. This is shown in table 2.

Table 2 Top 10 contributors to the total GHG emission reduction in the EU in 2014

Clearly, there are strong indications that lower heat demand and consumption is the key determinant for the decrease in emissions in 2014, not only in the EU as a whole but also at MS level. Other reasons can indeed be at play, including the continued increase in renewable energy for electricity generation. The next section will show that milder winter conditions in 2014 can by and large explain the reduction of 185 million tonnes of CO2 equivalent in the EU.

1.5 Weather conditions as a key driver of emissions in 2014
There is evidence of significantly lower heat consumption and heat demand in the residential and commercial sectors, and partly in the power sector, due to warmer weather conditions in Europe during 2014 compared to 2013. In fact the year 2014 was the hottest year on record in Europe with mean annual near-surface temperatures over land 2.11 to 2.16 °C higher than the pre-industrial average5.

Based on data for Europe from the UK’s Met Office Hadley Centre, the average monthly near-surface temperatures over land were substantially higher in most months where heating is usually needed6. Furthermore, according to Eurostat and EEA data, there was a 13% decrease in the number of heating degree days (an indicator of household demand for heating) in the EU in 2014 compared to 2013. This affected almost every month of the autumn and winter seasons. Thus, mean temperatures for Europe as well as heating degree days strongly suggest that warmer winter conditions in 2014 are largely responsible for the decrease in fuel use and emissions from buildings (residential, commercial and institutional) that year. This result is statistically significant on average for the EU, when considering the evolution of HDDs and GHG emissions in 2014 in all MS.

Figure 3 below, which is based on daily gridded data (E-OBS)7, illustrates the difference in average annual near-surface temperatures in Europe between 2013 and 2014. The map shows that, notwithstanding regional variability, mean temperatures in most parts of the continent were higher, or much higher, in 2014 compared to 2013.

All in all, the lower emissions in the EU in 2014 can be attributed to the sharp decline in the consumption of heat and electricity. This was due to lower heat demand from the milder winter/autumn conditions and to the continued increase in renewables for electricity generation, particularly of wind and solar.

Figure 3 Mean near-surface temperature change between 2013 & 2014 in Europe: average temperature of the season January, February, March, October, November and December

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