Update of the Integrated National Energy and Climate Plan (PNEC) for the period 2021-2030

On 17 July 2024, the Minister for the Environment, Climate and Biodiversity, Serge Wilmes, and the Minister for the Economy, SMEs, Energy and Tourism, Lex Delles, presented the final version of the updated Integrated National Energy and Climate Plan (PNEC) with the main changes compared to the project adopted in July 2023.

Main changes compared to the draft PNEC update of July 2023

The NECP update takes account of the European Commission's recommendations, the Government's 2023-2028 climate and energy policy programme, and developments since July 2023. The main changes in the final version of the NECP update compared to the draft adopted in July 2023 are as follows:

Accelerated deployment of renewable energies: the target for the share of renewable energies in gross final energy consumption is set at 37% in 2030, corresponding to the upper end of the range (35 to 37%) indicated in the July 2023 draft update.

«Accelerating the development of renewable energies is one of the government's priorities: by simplifying procedures and holding more discussions with the players on the ground, the bottlenecks can be identified quickly», explains Lex Delles, Minister for the Economy, SMEs, Energy and Tourism.
For the various renewable energy technologies, political developments have been taken into account, particularly those arising from the coalition agreement:
- Photovoltaics: study on photovoltaics along motorways, introduction of pre-financing, analysis of tacit agreement on authorisations;
- Wind power: analysis of safety distances to allow siting closer to motorways and business parks, obligation to offer citizens and municipalities affected by the siting of wind turbines a stake in the capital of developers/operators;
- Hydrogen: Luxembourg is to join the international hydrogen network, in particular to decarbonise heavy industry.
Confirmation of the ambitious national indicative target for improving energy efficiency
Luxembourg confirms its ambitious national target for improving energy efficiency: -42% (compared with the REF2007), equivalent to 36,949 GWh of final energy in 2030. This energy efficiency improvement target is still within the range (-40 to -44%) indicated in the initial NECP (2020) and thus confirms Luxembourg's high level of ambition in terms of energy efficiency.
Removal of the ban-based approach to the phase-out of fossil-fired heating systems: The final version of the NECP favours a more voluntary approach, providing incentives and support for citizens and businesses, in particular through attractive aid schemes. According to Statec projections, only partial replacement (50%) of end-of-life fossil boilers by renewable energies would not affect the achievement of the 2030 climate target. By 2050, the replacement rate is assumed to increase progressively to 100%, which would make it possible to limit the number of fossil-fired boilers in residential buildings (to around 15,000 in 2050).
The PNEC update also promotes the development of district heating networks, which in some cases are a better alternative to heat pumps for replacing fossil-fired boilers.
Renewal and partial revision of the various aid schemes, highlighting the priority nature of incentives for the energy and climate transition, and encouraging public and business participation:
- With regard to the «Klimabonus Wunnen» aid scheme, the top-up payments for energy renovation and the replacement of a fossil-fuel boiler will be extended for the remainder of the support programme;
- Gradual introduction of pre-financing arrangements under the «Klimabonus Wunnen» aid scheme, facilitating access to low-carbon solutions for all citizens;
- Extension and adaptation of the «Klimabonus Mobilitéit» aid scheme, with an adapted graduation of aid according to environmental and social criteria as well as the introduction of aid for used electric cars from 1ᵉʳ October 2024.
Revision and extension of business support schemes to provide better financial support for businesses to make the energy and climate transition a success.

Process for updating the PNEC

Against the backdrop of the Paris climate agreement and its implementation at European and national level, the Integrated National Energy and Climate Plan (PNEC) adopted in May 2020 forms the basis of Luxembourg's climate and energy policy for the period 2021-2030. It addresses the following five dimensions:

decarbonisation, including renewable energies,
energy efficiency,
security of energy supply,
the internal energy market, and
research, innovation and competitiveness.

Through its NECP, each EU Member State sets national targets for renewable energy, energy efficiency and greenhouse gas emission reductions by 2030, and presents its policies and measures for achieving these targets.

At its meeting of 21 July 2023, following a consultation phase, the Government Council approved the draft update of the NECP, which was then sent to the relevant departments of the European Commission for assessment. On 18 December 2023, recommendations relating to the draft update of the Luxembourg NECP were published by the European Commission. These recommendations were analysed in detail by the Ministry for the Environment, Climate and Biodiversity (MECB) and the Ministry for the Economy. Some of these recommendations have led to changes in the draft update of the NECP, without however affecting the overall level of ambition of the plan.

Finally, the draft update was adopted by the government on 17 July 2024.

«With the update of the 'Energie- a Klimaplang fir Lëtzebuerg' (PNEC), the government is adopting an ambitious and pragmatic plan to support citizens, businesses and municipalities in their efforts to decarbonise. The PNEC brings together the main policies and measures needed to make a success of the transition to a low-carbon, resilient and competitive economy in the long term», emphasises Serge Wilmes, Minister for the Environment, Climate and Biodiversity.

Updated projections of greenhouse gas emissions to 2030

Taking into account economic developments since spring 2023 and the latest macroeconomic outlook, Statec has updated the basic data, models and impact of the measures proposed in the NECP. According to Statec projections, GHG emissions would fall by 56% in 2030. This would meet the national climate target set out in the Climate Act.

The cumulative balance of emissions compared with annual emissions allocations up to 2030 improves slightly compared with the draft update of July 2023. Over the period 2021-2030, Statec's work highlights a «bonus» of around 2,000,000 tonnes of CO₂ compared to the annual emissions allocations trajectory, corresponding to approximately 3.4% of the total emissions budget (compared to 1% in the draft update). The annual emissions allocations would be respected by 2030.

Greenhouse gas emission reduction target met by 2023

The provisional greenhouse gas (GHG) emissions for the year 2023 attributed to Luxembourg under Regulation (EU) 2018/842, determined on the basis of the proxy GHG inventory, are estimated at 6,908,000 tonnes of CO₂. They are the result of an initial estimate based on a provisional energy balance drawn up by Statec and supplemented, for non-energy related emissions, by calculations carried out by the Administration de l'environnement and the Service d'économie rurale.

According to this provisional assessment, GHG emissions in 2023 will be significantly lower (more than 6%) than the emissions budget (7,373,000 tonnes of CO₂) for 2023. The emissions reduction target for 2023 has therefore been met, as was the case for 2020, 2021 and 2022.

Down by almost 150,000 tonnes of CO₂, emissions, i.e. 2%, compared with 2022, emissions in 2023 will be 32% below the level of the 2005 reference year. A more detailed provisional assessment will be shared by the MECB before the end of July, in accordance with the obligations of the Climate Act of 15 December 2020.

To sum up, Luxembourg has met its greenhouse gas emission reduction targets since 2020. And projections show that by implementing the PNEC update, we are on track to meet our climate targets by 2030.

To find out more

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Document: Update of the Integrated National Energy and Climate Plan, PNEC (Pdf - 8.18 MB)
PNEC - Presentation (Pdf - 900 Kb)

Further information

The National Integrated Energy and Climate Plan (PNEC)