New stakeholder recommendations on fulfilling the EU’s annual energy savings requirement

Member States’ plans are instrumental in reaching 2030 energy efficiency target

A new publication by the Coalition for Energy Savings provides recommendations for Member States planning for fulfilling their annual energy savings obligations post 2020. The minimum amount of energy savings set out by Article 7 of the Energy Efficiency Directive (EED), which was revised in 2018, is increasing after 2020. This will boost the energy efficiency markets and is instrumental in reaching the EU’s 2030 energy efficiency target.

By the end of 2019, Member States are required to notify their policies and measures and explain how they add up to meeting the energy savings requirement set out by Article 7, as part of their integrated national energy and climate plans (NECPs).

 

Over the period from 2021 to 2030, the total amount of energy to be saved in the EU under Article 7 equates to more than three times the annual energy consumption of France, meaning that it will be a key contribution to meeting the EU 32.5% energy efficiency target and to reducing greenhouse gas emissions.

The new and more demanding legal requirements for the 2021-2030 period will drive Member States to revisit, adapt and reinforce their policy portfolios. New provisions adopted last year should ensure that energy savings delivered each year by Member States under Article 7 are real and additional to business-as-usual.

Implementation issues have been observed in the first period of Article 7, which jeopardises our chances of reaching the 2020 energy efficiency target”, said Stefan Scheuer, Secretary General of the Coalition for Energy Savings. “The good news is that the revised Directive comes with more legal clarity and more ambition. Our publication provides a stakeholder analysis of the new provisions, as well as recommendations for Member States on how to put in place sound policies and measures that maximise benefits for citizens and companies”.

The Coalition for Energy Savings calls on Member States to deliver energy savings with sound Article 7 policies and measures. This will fast-track energy efficiency in national energy and climate plans and help Member States boost their energy efficiency contributions, which so far have proved to be insufficient to reach the EU 32.5% target.

Advancing energy efficiency on the global agenda

IPEEC Activity report

Energy efficiency now seen as underpinning a 1.5°C future

 

The proven potential for energy efficiency as a major contributor to global sustainable development and to promoting human prosperity goals – while helping to mitigate climate change – has driven IPEEC activities since its inception in 2009. Ten years on, it is timely to ask whether the message has been received and to what effect.

In October 2018, we saw this message amplified when the International Panel on Climate Change (IPCC) released a Special Report in which the Low Energy Demand (LED) Scenario delivered the fastest results in the most efficient manner. This scenario requires strategic action across four areas: reducing global energy demand; accelerating decarbonisation of energy supply; increasing renewable energy; and large-scale afforestation (IPCC, 2018). Clearly, energy efficiency plays a central role in the LED Scenario, with reduction in demand also lowering energy-related emissions.

Energy efficiency gained global attention in other key fora. The UN Sustainable Development Goal #7, adopted in 2015, sets the ambitious target to double the rate of improvement for energy efficiency, within the wider goal to achieve universal access to clean, affordable energy by 2030 (SEFORALL, 2015). Additionally, it was shown that energy efficiency measures can deliver almost half of the 2030 greenhouse gas (GHG) emissions reduction target set out in the agreement reached by the 21st Conference of the Parties (COP21) to the UN Framework Convention on Climate Change (UNFCCC), known as the COP21 Paris Agreement (UNFCCC, 2018).

 

 

EU Commission’s Joint Research Centre report: Energy efficiency, the value of buildings and the payment default risk

A new report by the European Commission’s Joint Research Centre (JRC), shows that higher energy efficiency is becoming more important for how buildings are appraised and also clearly linked to lower payment default risks

The report evaluates existing literature that discuss the impact of energy efficiency improvements on the value of buildings, as well as the methodology that can be applied to quantify property value linked to energy performance. It also demonstrates the impact of energy efficiency on the payment default risk – the link between energy efficiency investment and ability of borrowers to repay their loans.

Current demand for housing and location are still the main drivers to a building’s appraisal value and for a tenant’s selection of housing, but energy performance is becoming increasingly important across all reviewed countries, according to the report.

Today, buildings account for 40% of Europe’s total energy consumption, and around 75% of the building stock is considered to be energy inefficient. According to the European Commission, the current 1% annual renovation rate it would take around a century to decarbonise the building stock to modern, low-carbon levels.

In November 2016, the European Commission launched the Smart Finance for Smart Buildings initiative. The aim was to unlock private financing for energy efficiency investments in buildings, of which an important objective initiative is to “de-risk” investments.

The main findings of the report include:

  • Energy efficiency improvements seems to result in an increase of about 3–8% in the price of residential assets, and an increase of around 3–5% in residential rents compared to similar properties.
  • For commercial buildings, the premium seems to be over 10%, and in some studies even over 20% of sales price increase compared to similar properties has been reported. Rental prices of commercial buildings have also been positively affected, by 2-5%.
  • There are differences across regions and countries, as well as different property types (e.g. apartments vs. houses).
  • A change over time is also seen, as labels and schemes become more well-known and understood. As higher energy performance is becoming the norm, higher values are associated with better performance.

Energy efficiency upgrades change the basic characteristics of the buildings affected and has therefore an impact on other value drivers, such as comfort, safety and maintenance. According to the report, the lower default risk linked to energy efficiency should also be considered and reflected in financial products.

Bringing synergies between energy efficiency and renewables to life with ambitious political action… in an electric car!

At COP24, Monica Frassoni enjoyed a trip around Katowice in a Tesla thanks to the initiative #ETtalksdrive by our member Danfoss.

“Businesses’ support is very important for energy efficiency. The European Alliance to Save Energy is a partnership creating positive synergies. It gathers the front-runners that focus on a forward looking common strategy.”

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IPEEC: Behaviour change for energy efficiency report

Achieving change by incorporating behavioural insights into energy efficiency policies

The human dimension plays a complementary role to technology and innovation in delivering the full energy efficiency potential required to achieve the world’s energy and environmental goals. In recognition of this, under the 2018 Argentinian G20 Presidency, the G20 Energy Ministers noted in their Communiqué the potential for behaviour change to act as “a bridge between innovation, technological progress, and nationally driven energy efficiency measures, [and to deliver] greater benefits for consumers and all sectors of the economy.”

IPEEC, the Argentinian Ministry of Energy (MEN), and the International Energy Agency (IEA) hosted a workshop on ‘Behaviour Change for Energy Efficiency: Opportunities for International Cooperation in the G20 and beyond’ in September 2018 in Paris, France. Together, IPEEC, IEA and G20 economies – as well as other international organisationss, research organisations, and advocacy bodies working in this field, shared hands-on experiences and discussed the opportunities for international collaboration to explore how behavioural sciences can be applied to energy efficiency policies to enhance their effectiveness.

 

The recently released outcome report presents the key messages from the workshop, including the crucial role of human behaviour in scaling up energy efficiency, the ways behavioural insights can complement conventional policy instruments and approaches to improve energy efficiency, and the opportunities for international collaboration on this topic. The report also gathers sectoral insights for buildings/appliances, industry and transport, highlighting policy examples from different countries. Multiple next steps are identified in the report to translate this G20 political agreement into concrete actions.

IPEEC will continue to play a central role in coordinating the potential work related to behaviour change under the sectoral work streams of the G20 Energy Efficiency Leading Programme (EELP), and maintain the visibility of behaviour change in the energy efficiency landscape.