Directorate general for Energy and Transport 1 Doing more with less as part of the Lisbon Strategy...

Directorate general for Energy and Transport 1

Doing more with lessas part of the Lisbon Strategy

The Green Paper on Energy Efficiency


Background:The Green Paper on Energy

security of supply (2000) Gulliver in chains

Energy dependency in EU-25 is 50% and will reach 70% by 2030

Recognise the need to deal with the Demand side of Energy Policy

A wide debate with stakeholders with more than 300 meetings in 30 countries


What has been done since?

Energy Performance of Buildings Directive

Cogeneration Directive

Eco-design Directive

Proposal of a Directive on energy services and end-use efficiency

A new programme “Intelligent Energy – Europe”

Other measures including renewable energies


Why publishing a green paper on energy efficiency? (1)

An ever increasing energy consumption

1 to 2% a year increase of energy consumption

Energy consumption could still increase by about 10% by 2020

Broad discussion on how to curb rising energy use in EU and arrive at a reduction of 20% by 2020

The Priority dossier of the Commissioner


Why publishing a green paper on energy efficiency? (2)

Improve energy efficiency in EU to:Use energy more rationally – stop wasting itStop wasting money on energy we don’t need to use (Lisbon - growth)Mitigate climate change (Kyoto)Limit avoidable pollutionEncourage research and development in promising sectors (Lisbon – jobs) Increase our energy security position


The energy efficiency potential (1)

An ambitious goal of 20% by 2020 compared with today consumption

based on several scientific studies

cost-effective

Half of this potential can be realised with adopted legislations

Technical potential of around 40% reduction

Total energy consumption by fuel and energy intensity

0

250

500

750

1000

1250

1500

1750

2000

1990 2000 2010 2020

0

25

50

75

100

renewables

nuclear

natural gas

oil

solids

energyintensity

Energy intensity 1990=100mtoe


EXAMPLES of possible savings

Electricity production and cogeneration 70 Mtoe

Extension of buildings Directive 30 Mtoe

Eco-design 30 Mtoe

Transport 45 Mtoe

The energy efficiency potential (2)

Energy intensity (toe/M€95)-2003

0

200

400

600

800

1000

1200

1400

1600

DK IE AT IT DE FR SE NL LU UK EU ES BE PT EL CY MT FI SI HU PL LV SK CZ LT EE


Savings representing 60 billions € 200 to 1000 €/year for an average household

Around a million jobs could be created Reduce waste of scarce resources Strengthen the security of supply Strengthen our competitive position Gives new push to RTD

What are the benefits?


Quickest and most effective way to meet Kyoto Climate Change objective By saving 20% of energy

consumption, it would be possible to secure 50% of the necessary reductions of CO2 emissions

Reduction of local pollutionStopping wasting resources

What are the benefits for environment?


Where energy can be saved?

Tertiary12%

Transport24%

Industry22%

Non-energy use7%

Transformation losses, etc

35%

Estimated gross energy consumption (1 725 Mtoe)by sector in 2005 (EU-25)


What has been done?Where are we going?

Long-term development of GDP, energy demand and energy intensity (baseline) for EU-25

0

50

100

150

200

250

1971 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030

GDP Energy demand Energy intensity


The Negajoules concept

0

500

1000

1500

2000

2500

3000

1971 1974 1977 1980 1983 1986 1989 1992 1995 1998 2001

Mto

e

Coal Oil Gas Nuclear Other electricity Biomass Negajoules

Development of primary energy demand and of ‘negajoules’ (EU-25) (Energy savings calculated on the basis of 1971 energy intensity)


Financial obstacles Insufficient regulatory action Lack of market for energy efficiency No transparent and cost-reflective

prices Lack of information and education

Obstacles - Why is the potential not realised?

In theory market will achieve the best result,but…


Lack of information on costs and profitability Split-incentive Risk aversion

Address with: better and more (targeted) information Global loans and right intermediaries Role of Energy Service Companies

(ESCO’s)

Obstacles – The financial obstacles


Reluctance to commit to targets Sub-optimal use of tax and state aid

Address with:• Better information towards decision

makers• To create the political will and awareness • Better use of tax and state aid• Rationalisation of subsidies

Obstacles - The regulatory obstacles


Need to acknowledge that public authorities are necessary to address inadequacies of the market

Most obstacles can be removed by policy intervention

Influence change of behaviour by showing example

Action is needed now!


Options to achieve the

potential


European initiatives on all levels: European national regional and local industry consumers (citizens) International: Gleneagles conclusions

(7/7/05) Leading to Action Plan with concrete

steps

At what level energy efficiency should be addressed


Broad policy options Streamlining EE in all policy Research and Development

• EU is in the lead• Need to strengthen its efforts

Benchmarking National Action Plans• Good example in all Member states but not

replicated elsewhere• Commission can act as a catalyst• Exchange of best practices: gathering information and pass it on

What can be done at European level? (1)



• Financing options Better use of taxation Better targeted state aid Public procurement European co-financing Coordination of policies with the

EIB, EBRD, World Bank



• Specific option Extension of the Buildings Directive Domestic appliances (Minimum

efficiency and labelling) Increasing fuel efficiency of vehicles Foster market transparency Information and protection of

consumers


White certificates : a market instrument for energy efficiency

Electricity industry Regulation of electricity networks Regulation of supply activities – metering

What can be done at Nationallevel? (1)


Replacing power plants with 25% efficiency while best technology is 60%

Use of best technology Promotion of distributed

generation Promotion of cogeneration CHP in District heating Improve efficiency coal fired

plants over 50% asap

What can be done at Nationallevel? (2)

Improving electricitygeneration


What can be done at regional and local level?

Many measures can be taken at regional and local levels

Action will only produce all its potential gains if operations are reflected locally

Creation of regional and local energy agencies (networks)

Programme Intelligent Energy – Europe

Specific financing instruments: clearinghouse facilities

Information and communication


Promote best practices and exchange of information on results of various voluntary agreements

constructive contributions and commitment to efficiency goals, e.g. supporting voluntary agreements/code of conduct initiatives

Most regulation is directed at industry!

What can be done by Industry?


Information

Protection

What can be done at consumers/citizens level?


Integrating efficiency in international relations: Neighbourhood policy Development policy International financing

institutions

EU is better placed than Member State to initiate action at that level

What can Europe do at International level?

World energy use rising steeply

Uneven division of access to energy

Security of energy supply


Optimise traffic management (including air)

Develop a market for clean vehicles

Infrastructure charging

Improvement in tyresPromote public

transportAviation

Corner stones: Transports


Broad discussion till 31/03/05 With all stakeholders including citizens All options are open, all contributions

welcome On basis of results of consultation ---

Action Plan in 2006

The debate

More information:

http://europa.eu.int/comm/energy/

efficiency/index_en.htm

Directorate general for Energy and Transport 1 Doing more with less as part of the Lisbon Strategy...

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