To the kind attention of Jean-Claude Juncker, President of the European Commission

Cc: College of Commissioners

Brussels, 24 November 2016

Dear President,

The business community has high expectations on the ambition of the forthcoming “Clean Energy for All” package. We attribute a strategic importance to this proposal as it will give a political signal to the business, financial and investor community, not only in Europe but at global level as well.

As the representatives of the business sector, we welcome the commitment of the Commission on the ‘Efficiency First principle. We call for this principle to be reflected in the forthcoming proposals for a “Clean Energy for All” package by the European Commission through a 40% EU binding target for energy efficiency and an ambitious revision of key legislations, notably the Energy Efficiency Directive and the Energy Performance of Buildings Directive.

Regulatory certainty is fundamental to providing the private sector with the signals they need to make investment decisions and to incentivize the market to take up of new business models and services for clean energy and energy efficiency. Models such as those presented in our recent publication “Strategic investments for Europe: Evidence from cost-effective energy efficiency stories”.

The current non-binding 27% target barely corresponds to business as usual. Europe must increase the scale and rate required to meet its Paris climate commitments and if we want to secure a cost-effective energy transition, both a binding ambition for energy efficiency and clear long-term vision are needed.

Energy efficiency is not only a business opportunity, it is a societal imperative. Increased competitiveness for European companies will go hand in hand with economic recovery and the creation of local, longterm jobs. By using energy more wisely Europe can significantly reduce the EU’s gas import dependency and reduce EU greenhouse gas emissions in a cost-effective way.

The ratification of the Paris agreement was a proud moment for the EU. The European Commission has an opportunity to embody this commitment and show leadership from the highest political level by making efficiency the pillar of the Energy Union strategy in next week’s package.

Thanks for your attention,

Harry Verhaar

Head of Global Public & Government Affairs

Philips Lighting

Alix Chambris

Director of EU public affairs

Danfoss

Didier Teirlinck

Executive Vice President

Ingersoll Rand

Gene Murtagh

CEO

Kingspan

Sian Hughes

Director of External Affairs

Knauf Insulation

Bertrand Deprez

Vice President EU Government Affairs

Schneider Electric

Roland Ullmann

Director Industry Affairs – Building Automation

Siemens

Monica Frassoni

President

European Alliance to Save Energy (EU-ASE)

Dear Vice-President Šefčovič, Commissioners Arias Cañete and Vestager

The Energy Market Design Initiative is crucial to making or breaking the success of an Energy Union with a forward looking climate policy. It can deliver on multiple EU objectives; a greater focus on consumers and innovation; putting energy efficiency first; becoming a world leader in renewables; and implementing the Paris Agreement.

If we get market design right, Europe as a whole stands to benefit:

• Energy poverty can be cut if markets are leveraged to enable and incentivise citizensnto save energy, meaning a better deal for families;
• Energy security and resilience can be boosted if a single energy market effectively aligns national activity with EU policy across the continent;
• The lock-in of fossil fuel power generation can be avoided if the role of capacity mechanisms and other direct and indirect support for fossil fuels is minimised;
• Jobs, growth and essential emissions reductions can come to Europe if the deployment of clean renewable technologies such as wind and solar is facilitated;
• Europe’s innovative digital industries can get the information and business case they need to deliver the energy systems of the future if energy markets transparentlyreflect the full cost of delivering both energy and reliability in real-time.
• Europe needs faster, more competitive and better connected energy markets to fully integrate the new energy technologies that are needed to drive decarbonisation. A well signalled and transparent evolution of EU energy markets is required.

Starting with the 2030 package, the EU needs markets that deliver affordable, sustainable, and secure energy by:

• Realizing the potential of cost-effective energy efficiency and demand response as alternatives to generation through unhindered market access for consumers, enhanced access to information, and appropriate remuneration so that people andbusiness reap the benefits of consuming less energy and/or consuming energy more flexibly;
• Introducing a sustained programme of smart retirement of surplus resources that starts with the dirtiest and least flexible power sources and leads to no coal in the EU by 2030. This is required both to decarbonise the power system and to tackle the problem of excess generation capacity;
• Regulating and incentivising distribution system operators to act as neutral market facilitators of a more decentralised energy system that, in conjunction with the transparent setting of taxes, fees and network tariffs, strengthens the role of citizensin the production of renewable energy;
• Balancing of supply and demand across Member States through effective interconnections, regional markets (including completing the coupling of balancingmarkets) and independent, regional system adequacy assessments.

We urge you and your fellow Commissioners to seize the opportunity to deliver an ambitious reform of EU energy markets and put the EU on a course to a brighter, cleaner future.

Yours sincerely,

CECED European committee of domestic equipment manufacturers

Paolo Falcioni, Director-General

Client Earth

Karla Hill, Director of Programmes

Co-operative Energy

Ramsay Dunning, Managing Director

E3G Third Generation Environmentalism

Nick Mabey, Chief Executive

Energy4All

Annette Heslop, Company Secretary/Director

Energy Cities

Claire Roumet, Executive Director

European Alliance to Save Energy

Monica Frassoni, President

ECOS – European Environmental Citizens Organisation for Standardisation

Laura Degallaix, Director

European Heat Pump Association

Thomas Nowak, Director

ODE Decentraal

Siward Zomer, Director

REScoop.eu – European federation of groups and cooperatives of citizens for renewable

energy

Dirk Vansintjan, President

Som Energia Renewable Energy Cooperative

Gijsbert Huijink, Manager

Tipperary Energy Agency

Paul Kenny, Chief Executive Officer

World Future Council

Stefan Schurig, Member of the Executive Board, Director Climate Energy

WWF European Policy Office

Genevieve Pons, Director

On behalf of the European Alliance to Save Energy (EU‐ASE), we are writing to express our full support for the ongoing work of the European Commission on the revision of both the EED and EPBD.