Analysis of Fit for 55. Impact assessment for the Czech Republic
The aim of the study is to use macroeconomic and techno-economic models to assess the impacts of the EU’s Fit for 55 package on the Czech Republic and thus provide expert input into the discussion on setting domestic policies that will not only meet the package’s objectives but also effectively exploit the growth potential of the transition to a low-carbon economy while avoiding major negative social impacts.
The impact assessment is based on a comparison of the baseline scenario (without the Fit for 55 package) with several alternative scenarios for the implementation of the package. The results of the modelled scenarios show that the target of 55% GHG emission reduction by 2030 is achievable, but additional measures will be needed to achieve climate neutrality by 2050. However, the scenarios in this study were not defined with the objective of achieving climate neutrality by the end of 2050.
The model scenarios develop two decarbonisation trajectories with different rates of renewable energy development and levels of dependence on electricity imports. The estimated impacts on the economy are not necessarily negative (compared to the rising reference scenario).
In case a substantial part of the revenues from GHG pricing is used for climate investments and in particular for the transformation of the buildings and transport sectors, the climate transition can lead to increased economic activity and an overall positive effect on macroeconomic indicators (GDP and employment). However, this effect will be unevenly distributed across economic sectors, and it will therefore be necessary to strategically support and provide training for workers in growth sectors (renewables, construction), alongside reorientation, downsizing and retraining programmes, particularly for fossil fuel-related sectors.
This study will be followed up by further analyses which will extend the study to assess the proposals in the new RePowerEU package.