Ladies and gentlemen, good afternoon.

This has been one of the most intense weeks that this Commission has seen since the start of the mandate. And so I’m very glad to have the opportunity to take part in today’s discussion at what is a very unique moment for all of us, after the presentation of the Commission Recovery Plan.

I want to begin with a quote that has been on my mind this week. Martin Luther King talked about being confronted with “the fierce urgency of now.” He meant the need to act quickly and strongly to the greatest challenge of his time.

For Europe, and the world, our “fierce urgency of now” is how we respond to this generation-defining event.

Our challenge is executing a generation-defining response to this unprecedented crisis. For that, our response must be two-fold: it has to address the greatest need and the greatest opportunity in front of us. The greatest need is to stimulate the European economy again and return to our strength before the crisis. The greatest opportunity is using this moment to fast-track Europe towards an economy that is more sustainable and technologically advanced than before.

I believe the Commission’s Recovery Plan for Europe sends a clear message that we repair Europe’s economy, and prepare its future competitiveness: the Green Deal is at the heart of our recovery plans.

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I have fought, inside the College, to explain that the energy system was deeply affected by the pandemic crisis. On the face of it, there was little to no impact on the energy sector. How many of you here today experienced any disruption in the supply to your home? But this stable supply gave us a false sense of security. If we dig deeper, the figures tell a different story. The International Energy Agency just published its report on world energy investment for 2020.

The bottom line is this: the COVID crisis has triggered the largest annual fall in global energy investment in history. That is a decline of roughly $400 billion, about 20%. That is a staggering number. For 2020 we expected modest growth. And even though renewables have been more resilient during the crisis than other parts of the sector, we are seeing a huge fall in investment, broken supply chains, cancelled orders putting a stop to the pipeline of renewable projects. So, the reality is that this crisis has impacted the energy sector across the board. And that impact goes much deeper than we had imagined.

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The Commission plans – the Next Generation EU and the reinforced MFF - will help us to tackle exactly these challenges the energy sector is facing.

Our new proposal plans to future-proof energy infrastructure first of all through increased investments.

The InvestEU sustainable infrastructure window will be doubled. In particular, it will support renewable energy, interconnections and the Renovation Wave.

The ReactEU instrument of 55 billion EUR, a top up to the broader cohesion policy for the years 2020-2022 will support green investments. That means it could be used for Renovation Wave, or potentially local electricity grids or innovative clean hydrogen production solutions.

I have insisted to get the message across that the energy sector is a strategically important ecosystem for the European industrial economy. I am very happy that we have created a new Strategic Investment Facility to support investments in European strategic value chains with a budget of 15 billion EUR and that the energy sector will benefit from it, for critical infrastructure support or renewable energy technologies, or for energy storage technologies, and clean hydrogen and fuel cell applications.

A major increase is also proposed for the Just Transition Fund, which now will allow us to steer 40 billion EUR to the regions most affected by the transition to climate neutrality. This will allow us much more support to clean energy solutions and energy efficiency projects at the regional level.

The most substantial instrument of the package, the Recovery and Resilience Facility with a budget of 560 billion EUR will provide grant and loan support for the Member States to carry out needed reforms. That includes actions needed to push towards the clean energy transition and boosting energy efficiency in housing and other economic sectors. These proposed reforms are evaluated against the European Semester recommendations, the National Energy and Climate Plans and Just Transition Plans, making sure that green transition is in the heart of the reforms.

These are huge investments in a cleaner and greener energy sector. But still not enough alone. The investments needed are much bigger that what we can cater for with the Recovery Instrument or with the EU budget So we must push hard to leverage investments from the private sector and that’s why I believe we must provide, as European Commission, at the same the policy certainty needed.  

So, yesterday’s announcement brought another good news for the energy sector: for 2020, our planned energy policy initiatives will not only continue but will be strengthened. Over the past few weeks we have had discussions on where the crisis may derail the timing of our plans. But now we have confirmed that we will continue on with our actions for this year. And that gives Member States both the certainty and the support to target the much needed investment in these areas.

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The green thread in the plan announced yesterday makes it clear to me that the energy system emerging from the crisis will look very different to the one that entered it. Globally, we will see reduced investment in oil and gas. The counterpoint will be increased investment in renewables. At the same time, consumer demand will shift and we will see greater uptake in digital technologies within our system, more on line shopping, different mobility patterns.

We need to be prepared a profound change, and set a vision and a pathway to move into a new, more integrated energy system. Beginning with the launch of our strategy for Energy System Integration in June. The Strategy makes it clear that our energy system has the potential to be greater than the sum of its parts: we can reach greater decarbonisation and more cost-effectiveness for our citizens if our system operates as one continuous and intuitive system across all energy carriers and infrastructures.

If we create a system that is more circular.

If we push for even more direct electrification of end-use sectors.

If we shape a sector that uses greater renewable and decarbonised fuels.

And if we promote a more decentralised and digitalised energy network.

Essentially, if we connect the dots…we will have the energy system of the future. And our Strategy will map out what the obstacles are, and what we need to do from a legislative and policy perspective to overcome them.

In parallel in June, I will present a stand-alone Communication on a strategic outlook for building a Hydrogen economy in Europe. Because we believe that hydrogen has high potential as an energy carrier and a central role in decarbonising our system. Yet, today it represents less than 2% of the energy mix.

Together, the Strategy and Communication will connect different work streams, including industrial, infrastructure and research. We believe they will promote jobs, growth, and the increased investment and innovation will bring even greater momentum to our green recovery. I was very pleased yesterday to see the call to action by eight of the leading companies in the renewable industry, including the ENEL of Mr Starace, to ensure that pursuing renewable hydrogen as one of the best pathways to future-proofing the energy sector. It’s important that we are all on the same wavelength.

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Also, I want to mention energy efficiency: one of the most important areas to contribute to the recovery in the energy sphere. Increasing the efficiency of buildings has a dual benefit. For the economy, we know the EU construction sector is responsible for around 10% of GDP. So a Renovation Wave will support labour intensive industries and get Europe back working quickly. For our climate, greater energy efficiency means we are closer to our climate goals.

In this new context, we are going further. We want to at least double the current renovation rates in Europe.

With that in mind we are presenting our Action Plan for buildings renovation in September. This Plan will identify the barriers holding us back - whether they are financial or regulatory. The Plan will also look at the incentives and supports that are already there or that need to be established for us to build a strong pipeline of projects. 

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Ladies and gentlemen, the last few months have revealed our sense of collective vulnerability. How we overcome vulnerability is by working together to address the challenges. And that is what we are doing with our plans for recovery.

With the green transition at the heart of the Plan, energy will have an extremely important role to play, as it always did. But, now the stakes are even higher. Our ambition is even higher.

I will finish here and I am looking forward to the discussion.

Thank you.