EGEC provided its answer to a questionnaire which allowed stakeholders to suggest potential revisions of existing activities that are already covered in an EU Taxonomy Delegated Act in force (see Taxonomy Climate Delegated Act and Taxonomy Complementary Delegated Act) or under scrutiny by EU co-legislators (see Taxonomy Environmental Delegated Act and amendments to the Taxonomy Climate Delegated Act) or to suggest new economic activities that should be added to the EU Taxonomy.
EGEC sent three responses to highlight the importance of amending the “substantial contribution to climate change mitigation” criterion required for the following activities:
EGEC responses in brief
Geothermal energy technologies are clearly identified as sustainable investments in the sustainable finance taxonomy. Geothermal power plants, geothermal district heating and cooling, geothermal cogeneration, geothermal heat pumps, UTES and other forms of thermal energy storage can all be eligible as a “sustainable investment”. However, the production of geothermal electricity and heat and cool generation are all required to comply with an emissions threshold of LCE<100g CO2e/kWh verified by independent third party. Therefore, EGEC stressed that this threshold should then be removed for all geothermal technologies.
The obligation to carry out an LCA is seen as an additional obstacle for geothermal electricity and heat and cool generation. To comply with the emissions threshold of LCE< 100g CO2e/kWh, a LCE verified by independent third party is an additional cost. On the contrary, after evaluating several scientifically based life cycle analyses for geothermal plants, it can be stated that the emissions are always below the abovementioned threshold for representative plans.
Moreover, the criteria put in place for geothermal energy appear to be unfair when compared to the ones applied to other renewables. The EU taxonomy has so far sent the wrong signal for electricity and HC generation from geothermal energy, despite the low CO2 eq/kWh. As rightly underlined in the Motion for a European Parliament Resolution on Geothermal Energy (2023/2111(INI)), voted by MEPs in ITRE Committee on 7 Dember 2023, it is to regret “that a life cycle analysis is being applied to geothermal energy but not to other renewables, which contradicts the technology-neutral approach of the Taxonomy Regulation, minimizes the considerable potential of geothermal energy as a contribution to decarbonisation, especially in heat supply, and exposes it to unequal competitive conditions to other renewable energy sources; calls, therefore, on the Commission to review the classification of geothermal energy applications in the taxonomy provisions in order to put geothermal on equal regulatory footing with wind and solar”.
See the three contributions here: