Focus on industrial energy efficiency in Europe

The gods are obviously shining down on industrial energy efficiency in Europe these days. For too long, energy efficiency policies and programmes were geared towards the buildings sector. Yes, there is a requirement for mandatory audits for large industry and there is promotion for energy management systems and to help SMEs, but the overall effort has been limited.

There are two important initiatives underway that give some hope.

• Energy Efficiency Financial Institutions Group (EEFIG)

Fortunately, the Energy Efficiency Financial Institutions Group (EEFIG), created in 2014, identified many of the barriers to the long-term financing for energy efficiency and proposed policy recommendations and market solutions to them. The purpose of the group is to get the financial institutions and other relevant stakeholders to help find ways to overcome the investment blockage. There is financing available, but banks have poor capacity and interest to finance energy efficiency, and consumers (in this case industry or businesses or institutions) are reluctant to decide to undertake such measures. While there are some investments, for sure, they are not at a scale that will have a real impact that is needed to meet our long-term objectives. One of the problems is that there is a lack of standardisation in project development and documentation and that is seen as one of the major barriers to increasing investment into energy efficiency.

The members of EEFIG identified a clear opportunity to dramatically grow and improve energy efficiency investments in Europe’s industrial and non-industrial companies of all sizes to deliver competitive advantages globally and locally. EEFIG identified a need to raise the priority of energy efficiency at executive board level, incorporate energy efficiency investments within the standard corporate finance dialogue and process and to encourage firms to be more open with the investment horizons, scope and returns for energy efficiency investments which they will accept.

The 2015 Final Report of EEFIG provided the following recommendations concerning industry:

  • The policy framework should positively support strong corporate energy efficiency investment choices at key points in their investment cycle
  • Public resources and facilitation should be engaged to establish dynamic and effective systems for sharing information and technical experience
  • Ensure EU and national policies and resources are working effectively together to drive R&D and optimal energy efficiency outcomes
  • Support the clarification of the regulatory, fiscal and accounting treatment and standardisation of Energy Performance Contracts
  • Energy efficiency opportunity identification and investible project pipelines should be supported with Project Development Assistance facilities for SMEs.

EEFIG has helped raise the profile of industrial energy efficiency but these recommendations remain, for the most part, unfulfilled. On October 19th there will be a special roundtable to discuss these recommendations and how the industrial sector fits into the EU’s overall energy efficiency strategy. Chairman’s Conclusions will be prepared and distributed to members of the EU institutions and relevant stakeholders.

 

• eceee Industrial Efficiency 2018

The European Council for an Energy Efficient Economy has also recently announced its 2018 industry efficiency conference to be held in Berlin next June 11th to 13th. The theme is Industrial Efficiency: Leading the Low-Carbon Transition. This is vitally important as Europe debates its clean energy future. Importantly, the event beyond the traditional scope relating to industrial energy efficiency to explore current and emerging trends in industry, such as new business models, digitalisation, industry 4.0, the circular economy and resource efficiency.

I will be one of the co-chairs of the conference and look forward to seeing you there.

eceee now has a call for abstracts. Information is available on the eceee website.

These initiatives are very important for raising the profile of industrial energy efficiency in Europe. For too long, industry was quietly assumed to succeed under the Emissions Trading System. For all its strengths and weaknesses, it has failed to promote energy efficiency and it is restricted to only the largest users. Too many who need to improve their energy performance to lower costs, lower emissions and improve their competitiveness, were simply left aside. But, the low-carbon energy transition needs all to participate to their fullest. We have to improve our policies. We need to increase investment.

Following the eceee, let’s all be leaders in the low-carbon transition.

 

 

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