Seldom do energy efficiency policies get such attention but this week the European Commission recommended a new target for 2030. While much has been written this week, Alex Barker provides a very good review in the Financial Times. The new target of 30% improvement is good but many have argued that even the Commission’s impact assessment showed that a 35-40% target would have been cost-effective and realistic. It shows that setting targets is more political than technical, and that is understandable. What will member states accept? Are there many complementary benefits (e.g. improved health) that are not even calculated that could tip the need for an even more ambitious target? And with current energy security issues related to Russia in the news daily, can we accelerate energy efficiency measures? Yet, can we ramp up measures and the level of ambition? Are member states capable of doing more? There is so much to think about. The new European Parliament and the soon-to-come new set of Commissioners, there is much to reflect on – and act on.
EU energy saving plan targets Russian gas links
Brussels unveiled a 30 per cent energy efficiency target on Wednesday aimed at weaning Europe off Russian gas, but appeased opponents by stopping short of demanding that the goal be obligatory.
After months of talks that pitted Poland and Britain against German-led advocates of tougher targets, the European Commission opted for a compromise: setting a slightly bolder goal to burn less fuel, while staying silent on whether it should be binding.
At issue in the energy efficiency debate is not just Europe’s policy response to the fuel supply dilemmas raised by the Ukraine crisis, but a fight over the uneven financial burden of meeting mandatory goals. There is also a policy question over whether efficiency targets are needed at all.
While the commission recommendation sets the marker for the future debate, the target needs the unanimous backing of EU states if it is to be adopted or fleshed out in legislation. EU governments are working towards a self-imposed October deadline to decide 2030 climate and energy policy.
The target unveiled by Günther Oettinger, the energy commissioner, encourages governments to improve efficiency so that consumption in 2030 is 30 per cent below the levels expected in projections from 2007. Mr Oettinger said it put Europe “at the vanguard of energy efficiency”.
Energy efficiency is considered the simplest and most cost-effective way to cut carbon emissions.
The EU already has a 20 per cent efficiency target for 2020 that is voluntary. Meeting a binding target would require an overhaul of building standards, electricity grids, lighting, insulation and heating networks.
According to EU estimates, a 25 per cent target would cut EU gas imports by about 9 per cent, while a 35 per cent target would slash gas imports by 33 per cent by 2030.
The commission’s new target is more ambitious than the 27 to 29 per cent level recently envisaged by some EU officials but below the tough 35 per cent mandatory minimum pushed by Germany and Denmark. They see smarter consumption as essential to reducing dependence on imported Russian gas, which at preset covers about a third of EU demand.
Jean-Claude Juncker, the incoming European Commission president, has taken a stronger position on forcing countries to meet the goal, telling the European Parliament last week that “a binding 30 per cent energy-efficiency target is for me the minimum”.
While the Ukraine crisis and uncertainty over Russian energy supplies have strengthened the hand of those countries backing an ambitious efficiency drive, it has yet to surmount serious divisions between member states.
Eastern European nations fear they will shoulder a disproportionate burden in reaching tough targets because of how costly it would be to overhaul inefficient Soviet-era central heating systems that dominate their cities.
Britain, meanwhile, backs ambitious targets for cutting greenhouse gas emissions. But it wants states to be free to decide how they make their cuts.
Some EU officials fear mandatory efficiency goals will distort Europe’s carbon trading market and aggravate the problem of weak prices. By contrast, insulation companies, such as Knauf of Germany and Saint-Gobain of France, say fixed goals are essential to unlocking investment.
Energy in Demand - Sustainable Energy - Rod Janssen 
There are still some purists at the top of DGClimate who wish to see less energy efficiency happen as they believe that will lead to a higher trading price within the EU Emissions Trading System. These people have entirely lost the plot – why have they forgotten that the Emissions Trading Scheme was introduced entirely as a mechanism to reduce emissions, not just to make money for carbon traders, and there is no more cost-effective way to achieve this than via reducing energy wastage ?
It is hard to know what those in DG Climate think. It is interesting to read the impact assessment that accompanied the communication this week. It says “The more the energy savings, the lower becomes the ETS price as EE policies reduce the demand for electricity in the ETS sector. Also, EE improvements in industry reduce the demand for ETS allowances. In addition, in the EE40 scenario which significantly overshoots the GHG target, efficiency policies shift emission reduction efforts from ETS to non-ETS sectors.” (p. 51). This drives DG Clima crazy, I would imagine. I would have thought they would be pleased to “overshoot significantly.” What a great benefit. And if you look at the IA, EE40 is so much more effective in reducing energy imports, which we seriously need.