Consider gradual introduction of carbon pricing, taking into account the social dimension
Currently, energy is considered too cheap to drive behaviour towards more energy efficiency, e-mobility and fuel switching.
Luxembourg
Luxembourg’s energy demand and greenhouse gas emissions have shown signs of decoupling from its robust economic and population growth and the country doubled the share of renewables in its energy supply from 2008 to 2018. The government has adopted an ambitious target to reduce greenhouse gas emission 50-55% by 2030 compared to 2005.
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Luxembourg faces challenges achieving its energy sector targets. Low energy prices are a barrier to needed investments in energy efficiency and renewables. The country has a fossil fuel intensive energy mix driven by a high demand for transportation fuels, notably from transiting freight trucks and commuters. In 2019, the government modestly increased excise duties on gasoline and diesel to reduce fuel demand and is considering additional increases. The government’s plan to introduce gradually increasing carbon pricing in 2021, could stimulate the behavioural changes and investments required for the transition to a low-carbon energy system.
Luxembourg is embedded in the European electricity market. Amid a fast transition in the region, security of supply is a priority and Luxembourg plans to expand renewables generation and electricity grids. The government should consider deployment of energy storage and demand side response measures, while ensuring competitive markets that foster innovation and new energy services.
Luxembourg is embedded in the European electricity market. Amid a fast transition in the region, security of supply is a priority and Luxembourg plans to expand renewables generation and electricity grids. The government should consider deployment of energy storage and demand side response measures, while ensuring competitive markets that foster innovation and new energy services.
Last updated Jun 23, 2020
Key energy statistics
Key recommendations, 2020
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Develop scenarios on how to achieve the ambitious 2030 renewable energy targets
Scenarios should include expectations for regional renewable energy deployment, for the different end-use sectors, and for centralised and decentralised options.
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Reconsider the adequacy of approval procedures for electricity infrastructure
Establish rules to evaluate alternatives to grid extension, and consider whether it would be necessary to establish rules for congestion management and curtailment compensation in relation to variable renewable energy
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Finalise a legal framework for smart meters and energy data
This will support the active participation of consumers in the electricity and natural gas markets, facilitate new service providers, and enhance security of supply.
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Examine the effects of the recent fuel tax increases
Consider further incremental increases that support the achievement of greenhouse gas emission reduction targets.
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Evaluate how much existing transport policies contribute to 2030 targets
Formulate a set of coherent measures to achieve a sustained reduction in fuel demand.
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Luxembourg 2017 In Force National
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Luxembourg 2014 In Force National
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Luxembourg 2014 In Force National
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Luxembourg 2013 In Force National
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Luxembourg 2011 In Force National