Energy efficiency needs to be treated as an energy source

This has been an important year for energy policy in general, but energy efficiency in particular. Hans Nilsson, expert through his company FourFact, Advisor and Honorary Chairman of the IEA DSM-Programme and a friend of EiD, has written a thought provoking column on the eceee website. While the European Commission has been promoting the need to re-assess all energy policy to meet the challenges of the future, energy efficiency seems to be treated (again) in a far too dismissive manner. Maybe we can’t leave the rethinking to the Commission and we have to raise our voices all the more. What do you think?


Fundamentally rethinking

After the launch of The Energy Union we were a bit puzzled whether the Commission really stood behind the statement that Energy Efficiency is to be considered to be the First Fuel. It said so in the press release accompanying the launch, but it was more vague in the actual text.

So in February this year, we were pleased to see the text in the “Energy Union Package” in the communication from the Commission to the European Parliament. Here, at last, we found an explanation that reads:

’‘It is necessary to fundamentally rethink energy efficiency and treat it as an energy source in its own right, representing the value of energy saved. As part of the market design review, the Commission will ensure that energy efficiency and demand side response can compete on equal terms with generation capacity.’‘

This sounds reassuring, doesn’t it? The Commission is in a process to establish how energy efficiency should be made the first fuel! But we can easily imagine that such “fundamental rethinking” does not jump out of a hat. It will require a change in policies, regulation, instruments, behaviour, and many other fundaments.

So it was with feverish interest and sweaty hands that we opened the next communication on the subject from the Commission in November. The title of the document is wittingly made “The state of the Energy Union”. Now we would get a first glimpse of what “fundamentally rethinking” means in reality. And this is what we found:

“There are still numerous barriers to reaping the full potential of energy efficiency, such as information failures and a shortage of dedicated financial tools. This leads to a limited uptake of energy efficiency opportunities, products and technologies.”

Is somebody joking?

Is the notion that there are information failures and shortage of financial tools fundamental news to anyone? What about energy efficiency obligations, least cost planning, stricter regulation, multiple benefits, split incentives, behavioural economics, “nudges”, energy services, circular economy and a hoist of other concepts that could be part of a FUNDAMENTAL RETHINKING?

Are they joking? Or is it worse?

We must ask the Commission to rethink this fundamentally!

6 thoughts on “Energy efficiency needs to be treated as an energy source

    • I fully agree. Let’s see if one of the eceee board members based in Brussels can raise this. It is fundamentally important. A re-think has to be a re-think, not greenwashing.

  1. This very good article reminds me about the difficulty which we had, trying to explain that EPC (Energy Performance Contract),virtually it is a concept by which somebody “sells efficiency”, or to put it differently, “Negawatts” which, voila, it is “a fuel” !…can you believe that Eurostat does rank this operation as a “public debt” in a Municipality book which becomes more efficient ?!?!…Indeed, a FUNDAMENTAL RETHINKING it is a must !

      • You are right and it is striking that we have several mental hurdles to pass. One that is deeply engrained in our society is that of “economism” where we basiacally assume that if people do not jump to energy efficiency it is because they have made a rational choice and have preferences for consuming energy instead of saving/economising.

        Energy effiency is deceivingly simple since the technology is. But getting the peices together is rather complicated and will require more efforts, more engaged (and less romantic) policymaking and new businessmodels.

        With the help of Rod I found this today and it is really a refreshing read

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