2016 is the implementation year for the Energy Union, and the European Commission has promised to deliver high ambition on energy efficiency.
• How will the EU put energy efficiency first in its climate and energy plans?
• How will the extension of the energy efficiency framework boost energy efficiency markets and investments?
The 2016 Energy Savings Summit (programme) was the leading conference dedicated to energy efficiency in Brussels ahead of the adoption of proposals by the European Commission.
On 25th May, the Coalition hosted its 2016 Energy Savings Summit, the leading conference dedicated to energy efficiency in Brussels ahead of proposals for energy efficiency framework after 2020 expected from the European Commission in September. It brought together key EU, national and local policymakers with energy efficiency stakeholders to discuss how the EU will put energy efficiency first in the policy framework and how the extension of the energy efficiency framework could boost energy efficiency markets and investments.
Paolo Falcioni, President of the Coalition for Energy Savings and Director General of CECED welcomed participants to the energy efficiency event of the year, calling energy efficiency the glue for the European Union and a key aspect in many issues, including the internal energy market, financing and investment, climate and security.
The event began with Paolo kicking off a conversation with Marie Donnelly, Director at DG Energy, about the role of energy efficiency in Europe. Marie explained that total system costs are a key figure for the European Commission in determining the right energy ambition. She pointed to the role of energy efficiency legislation in creating a framework to counter market failures, highlighting the information gap – if we don’t know the cost, then we don’t know what can be saved; the behaviour gap – split incentives between property owners and tenants; and the finance gap – funding, although available, is not finding its way to energy efficiency projects. Member States have much more tools available than the EU, like taxation, grants, VAT, but the vision has to be European ‘that is why we have a target discussion’ she added. In response to a question from Paolo about whether we have done enough as energy consumption is already falling, Marie explained that, although significant progress has been made, there are further cost-effective opportunities to reap and benefits to deliver for citizens across Europe. Marie underlined that energy efficiency policies actually deliver results and the Paris agreement can only be met by improving energy efficiency.
Energy Efficiency First in Energy Union proposals: Achieving a coherent policy framework
Fiona Riddoch, a renowned expert in EU energy policies who was heading COGEN Europe when the Coalition was created, moderated the two panel discussions. She introduced the first panel on how to make energy efficiency first practical through policies.
Samuel Thomas, Senior Programme Manager in the Energy Efficiency Division at the International Energy Agency kicked off by highlighting how energy efficiency has played a key role in the modernisation of the IEA in terms of reaching out and engaging with emerging economies, and moving to become a clean energy hub, focusing on energy efficiency. He explained the IEA’s work that found that energy efficiency contributes more to meeting energy service demand in IEA countries than any other fuel. He also described how the multiple benefits of energy efficiency allow it to reach across political and policy silos. He highlighted recent work ahead of COP21 that found that 48% of the greenhouse gas cuts needed by 2030 to ensure global temperature does not rise above 2degree, will have to be from energy efficiency measures. Samuel concluded that a high energy efficiency target is required for the EU to develop and drive the supporting policies.
Thomas Boermans from ECOFYS talked about the ways to assess the impact of energy efficiency ambition levels. He explained that to put energy efficiency first you need to look first at what is good for society, and then consider how this impacts private actors considering the policy options to overcome barriers. He explained that ECOFYS research has found that starting with a societal view justifies much higher ambitions of up to 40% by 2030.
Theresa Griffin, Member of the European Parliament, gave a passionate plea to ensure that no one is forced to choose between heating, cooling or eating. She called for a binding 40% energy efficiency target for 2030 and strong EU framework for energy efficiency, as an opportunity to reconnect with EU citizens, since energy efficiency is key to better life for millions of citizens. She explained that energy efficiency and the growth of industry is not a case of either or, and can happen alongside each other – highlighting best practice from the UK with increasing the efficiency of industrial plants.
With a climate focus, Magda Stoczkiewicz, Director at Friends of the Earth, called for the science and targets to be aligned: 40% GHG emission reductions by 2030 are not in line with the Paris agreement, But energy efficiency can help in the absence of appetite for more climate policies. She pointed to research by ECOFYS that suggests that a 40% energy efficiency target would reduce greenhouse gas emissions by 50%. She also linked energy efficiency with the wider benefits for society and suggested it could be a flagship project for Europe.
Giving a more local perspective, Claire Roumet, Executive Director at Energy Cities, explained that all mayors think energy savings should of course come first in the transition to a fully decentralised energy system. This is because they are aware of energy bills, and the need to support social tenants in paying those bills. It would be better to invest that money in energy efficiency. Claire explained that unfortunately there are many barriers, not least rules on public debt, which need to be changed to aid this investment. She said political ambition is vital, the finance is there, the technology is there – “it wants to break free”.
Energy Efficiency Directive and the 1.5% Savings Obligation: Boosting the prospects for investments
Dan Forster from Ricardo-AEA presented their recent work for DG Energy analysing implementation of Article 7 of the Energy Efficiency Directive – the target for Member States to achieve 1.5% saving per year. He explained how more than half of the savings resulting from the EED will be delivered by Article 7, and that slippage in implementation could have a big impact on how well the EED delivers. He explained how although Energy Efficiency Obligations are the single biggest measure, other important measures, such as taxes, financing schemes, regulations and standards are also part of the policy mix – allowing flexibility for implementation. Dan highlighted that Article 7 is also a big driver of buildings renovation. However, there are some important considerations to ensure that the savings are really credible, would not have happened anyway and are really happening. Despite implementation only being in the early stage, Dan underlined that the measures are proving certainty and driving the market for energy efficiency and creating more market opportunities. A report will be published in the coming weeks with further detail on implementation and expectations.
Moving to national experience, Martina Högberg, Deputy Director of the Environment and Energy Department in Sweden, explained that Article 7 is important and good since it focuses on delivering energy savings, rather than specific measures to do that. It allows countries to design measure that fit their specific national challenges and long terms objectives. In Sweden this means they have continued and stepped up their existing tax measures, despite changes in government. Looking to 2030, she stated that Sweden wants to see high ambition with a 30% energy efficiency target and a strong governance system to ensure the target is delivered.
Georg Maue, from the German Federal Ministry for Economic and Energy, spoke of Germany’s long history on energy efficiency and recent National Action Plan including 20 new energy efficiency measures. He explained that Article 7 has helped to steer and ensure continual improvement of national policies. However, he called for more advice from the Commission on how to implement it in different sectors. He stated that Germany supports the improvement of the Energy Efficiency Directive, including an energy efficiency target for 2030 of “30% plus”, and continuation of Article 7.
From a more local perspective, Simone Raskob, Deputy Mayor of the City of Essen and Board member of Climate Alliance explained the hard work being done on energy efficiency in Essen, which will be European Green Capital in 2017. She said that energy efficiency improvements are driven by the need to reduce public spending. She highlighted some good examples of efficient new buildings, but said that dealing with existing buildings is more challenging due to lack of money.
Mads Warming, Global Director on Water, Danfoss, said there was a need for policies, including Article 7, to drive forward and continue efficiency improvements, including beyond 2020. He gave the example of innovative business solutions which could be further scaled up and deliver more savings. The technology is there, policy makers should be made aware of these opportunities.
Monique Goyens, Director General, BEUC, said that energy efficiency is a no brainer for health, energy bills, dependency on energy imports, etc. She said the challenge was to make it easy for consumers to engage – particularly training those that are talking to consumers on the benefits. She called for more to be done at European level as energy efficiency is – meaning more ambitious energy efficiency policies. She linked energy efficiency with President Juncker’s vision for innovation and jobs and called energy efficiency a win-win-win – everyone wins from it.
The Summit closed with Claude Turmes, Member of the European Parliament, congratulating the energy efficiency community on the progress over the last 10 years, both to form a coherent voice and to help move ambitious policies forward. He called for focus on the Energy Efficiency Directive and to ensure it is improved. He underlined the need for financing to be better linked, particularly in Central and Eastern Member States.
Stefan Scheuer, Secretary General of the Coalition for Energy Savings, thanked moderator, speakers and participants and noted the important role of the Summit in mobilising the Coalition to stand up for tapping cost effective potentials from a societal perspective and to further broaden support across other policies. He closed the conference and welcomed participants to join the drink reception.