Luxembourg 2020 Energy Policy Review
The IEA regularly conducts in-depth peer reviews of the energy policies of its member
countries. This process supports energy policy development and encourages the exchange
of best practices and experiences.
Luxembourg experienced strong economic and population growth between 2008 and 2018.
For most of that decade, energy demand and carbon dioxide emissions fell significantly,
but they started to increase again in 2016. The government has adopted ambitious energy
sector targets, including a 50-55% reduction of greenhouse gas emissions by 2030.
Luxembourg faces challenges achieving those targets. Low energy prices for consumers
are creating a barrier to the investments needed in energy efficiency and renewables.
And the country has a fossil fuel-intensive energy mix driven by a high demand for
transportation fuels, notably from transiting freight trucks.
Luxembourg is embedded in the European electricity market, a sector that is transforming
swiftly as rising shares of variable renewable generation, such as wind and solar
PV, put increased attention on security of supply. In this context, Luxembourg plans
to expand and upgrade its electricity grids, but the country would benefit further
from the deployment of measures to increase energy storage and demand-side response
in its power system. It is also important to ensure competitive markets that foster
innovation and new energy services.
In this report, the IEA provides a range of energy policy recommendations to help
Luxembourg smoothly manage the transition to a smart, flexible and sustainable energy
Published on April 24, 2020
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