EU-ASE response to the Inception Impact Assessment on the Industrial Emissions Directive

European Alliance to Save Energy (EU-ASE) welcomes the opportunity to provide feedback to the European Commission’s publication of an inception impact assessment on the revision of the Industrial Emissions Directive (IED). 

While we believe the Directive has been responsible for solid progress against identified air and water pollutants, and the BREF process has contributed to identifying Best Available Techniques, in its current form the Directive is not able to contribute toward EU ambitions for climate neutrality. 

Based on this, EU-ASE would like to highlight the following recommendations to support the Commission in its ongoing work on the IED’s revision.

1. Broadening of the scope 

A change in scope is needed so that the IED becomes part of the EU’s arsenal for climate neutrality. The IED should not only look at industrial emissions from a qualitative perspective, instead it should go further and focus on use of resources in industrial manufacturing processes, circular economy and the reuse of resources in to order to have a real impact. 

2. Making the Energy Efficiency BREF mandatory for all sectors 

There is a general consensus that the Energy Efficiency BREF has not been made a priority focus in the past and needs strengthening of the requirements to reduce energy losses. Its implementation needs to be made mandatory for all sectors, taking into account the Energy Efficiency First principle. 

3. Tackling water scarcity and efficiency needs by reducing water consumption 

The issue of water scarcity and efficiency needs to be tackled before it becomes a larger, more critical issue for industry. In Europe, more than 50% of fresh water abstraction is for industrial purposes. While we welcome the inclusion of water reuse in the existing BREFs, the reduction of water consumption has clearly not been a key environmental issue addressed by the BREF technical committees as only 20 BAT conclusions (out of 850 in total) have included water usage reductions or increasing water reuse. 

4. Focusing on the energy-water nexus 

We believe that the IED should give greater priority to water consumption with a focus on reuse under circular economy principles. This should include a focus on water and heat in industrial processes (the “energy-water nexus”) where water efficiency leads to energy savings and emissions reductions.

5. New policy objectives 

We would like to see water efficiency and water reuse in industrial processes, waste water minimisation, and the digitisation of water management in industry become policy objectives of the IED. 

6. Horizontal BREF on water efficiency and reuse 

The Commission could consider developing a horizontal BREF on water efficiency and reuse to mainstream these practices across European industries. 

7. Fit for innovation and new technologies 

The slow incremental nature of the “available techniques” needs to be addressed to better promote innovation, and BREFs require a mechanism to adapt more quickly to rapidly advancing technologies (there is no backwards compatibility). 

8. Encourage behavioral change and incentive mechanism 

The Commission should seize this opportunity to encourage behavioural change amongst industry leaders and provide incentive mechanisms to help them realise the different benefits of water and energy efficiency measures (water, energy, emissions and industrial competitiveness).


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EU-ASE response to the Inception Impact Assessment on the 2030 Climate Target Plan

As European businesses and investors having energy efficiency and energy demand reduction at the heart of our activities, we strongly support President Ursula von der Leyen’s commitment to set the EU on a path to becoming the world’s first climate neutral continent by 2050 at the latest.

In view of this goal, we believe that the 2030 greenhouse gas emissions reduction target must be increased from the current 40% to at least 55% because a more ambitious target will put the EU on a more gradual and sustainable pathway to climate neutrality by 2050. An increased 2030 target is also critical because it reflects the absolute urgency, underlined by the IPCC latest Special Report on the impacts of global warming, to address climate change and reduce to minimum GHG emissions in the next ten years.

A growing number of Member States are already committed to increasing their climate ambition. A target of at least 55% by 2030 at the EU level is also feasible from both technical and economic point of view and, according to the European Commission’s own analysis, it is likely to lead to a net increase in GDP of 2%, a surge in employment and a reduction in costs linked to fossil fuel imports and health damages.

We believe that increasing the 2030 GHG target to at least 55% requires a comprehensive assessment which will consider the impact of such policy decision both in terms of direct benefits (e.g. employment, reduced energy costs and import dependency, competitiveness) as well as avoided costs (e.g. environmental damages, health costs, fossil fuel subsidies). We are also convinced that such assessment should be based on the analysis of the European energy infrastructure needs and must fully apply the energy efficiency first principle to prevent lock-in into carbon-intensive future pathways.


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EU-ASE response to European Commission consultation on climate law

According to the Commission LTS, the EU must halve its energy consumption by 2050. Energy efficiency therefore must play a central role in achieving net-zero GHG emissions by 2050.

Considering that the world economy will triple by 2050 and that global population will increase by nearly 2.3 billion by 2050, energy efficiency is the most cost-effective way to decouple economic growth from emissions.

Significant reductions in overall energy demand will come from energy use in buildings. Residential and commercial buildings currently account for 40 % of EU energy consumption – with 75 % of these buildings being built before energy performance standards existed – 36% of emissions and 50% of the total mineral resources extracted from the planet. Most of the housing stock of 2050 already exists and will need to be renovated. Our building stock needs to become net zero carbon, which involves ramping up the rate and depth of renovation and ensuring efficient and decarbonised energy supply in the building sector. The “Renovation Wave” needs to build from the implementation of the Long Term Renovation Strategies, but also explore new drivers and triggers, including regulation, in order to scale up what has worked well in some countries.


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EU-ASE Response to European Commission’s Targeted Consultation on EEAG

We would like to respond to the Roadmap that was released by DG Competition, namely on: 1) Targeted Consultation for the Evaluation of the Guidelines on State aid for Environmental protection and Energy 2014-2020 (EEAG)

*Please describe the relevance of State aid rules for you.

We believe that well-designed State aid schemes and measures can help achieve important policies in the Member States and in the EU such as reaching the 2030 targets while ensuring that the energy markets are affordable, flexible and secure. This is specifically to:

– Promote the financial investment in energy efficiency and use of renewable energy;

– Prevent the granting of aid that promotes carbon lock-in through investments in unsustainable projects and energy intensive infrastructure.

EU-ASE Response to EIB Public Consultation on Energy Lending Policy

The European Investment Bank (EIB) ran an open consultation about its Energy Lending Policy. In what regards energy efficiency, the consultation proposed three different questions that you can see here. The EIB, as the European Union (EU) Bank, plays a significant role in financing energy infrastructure. The Bank’s current approach towards supporting the energy sector is set out in its Energy Lending Criteria (ELC). These were adopted six years ago, in the context of Europe’s 2020 targets.

EU-ASE members were encouraged to provide their feedback with examples of energy efficiency projects that benefited the EIB financing.


Within the broad areas of renewables, energy efficiency and energy grids, are there particular areas where you feel the Bank could have higher impact?

The European Union has estimated that to meet its 2030 climate and energy targets, around €180 billion would be required every year until 2030  in extra investment in energy efficiency, renewable energy, and clean transport. This figure needs to be further revised given that it uses a 2016 reference scenario and only a 30% energy efficiency and renewable energy targets for 2030, instead of the recently agreed targets of 32.5% and 32% respectively. Together these revised targets would lead to 45% GHG emission reduction target, which is still below the required reduction pathway to achieve the Paris Agreement objective.

According to the IEA modelling, energy efficiency makes the largest contribution to global emissions reduction and in the EU, energy efficiency can deliver 76% of the emission reduction required to achieve the Paris Agreement commitments.

Thus the EIB should invest more in energy efficiency projects across  all economic sectors, and focus particularly on those with high potential for energy use reduction, such as buildings. Building renovation projects, intended for both energy savings and buildings’ integration into a connected energy, storage, digital and transport system, deserve specific attention, as it is here that the EIB lending could have the highest impact, contributing to fill an estimated investment gap of 130 billion/year by 2030.

In order to increase investments in energy efficiency projects and promote the integration of the Energy Efficiency First principle.

The EIB should:

  • Fully apply the Energy Efficiency First principle and ask project promoters to embed the principle to first assess the economic opportunity to reduce energy consumption through cost effective energy efficiency solutions before investing in new sustainable supply capacities;
  • To do so, change its project appraisal guidance, to make sure economic appraisals systematically consider “do something (else)” counterfactual scenarios;
  • Further develop programmes that provide technical assistance for energy efficiency projects (e.g. upscale the Elena funding).


How can EIB reinforce its impact towards ensuring affordability, addressing social and regional disparities and support a just energy transformation?

While the EU is currently defining its vision for a climate neutral future, we are confronted with several challenges that can be addressed thanks to the support from the EIB. The three main challenges  are without a doubt: increased  investment needs in the energy sector, rising energy poverty and growing disparities among European regions.

While over the next decade, energy related investments will have to double, millions of European citizens expect a transition that will tackle the devastating impact of climate change and energy poverty in Europe. Indeed, more than 50 million people across Europe live in energy poverty and are unable to pay their energy bills. The energy transition provides us with a concrete opportunity to alleviate energy poverty in Europe if, across all sectors, ambitious measures to increase the rate of energy efficiency improvement are put in place.

The EIB energy lending policy can significantly help to address this problem and lead the way to a sustainable future for the good of citizens, businesses and the environment by making energy efficiency first an imperative principle of its investments decisions.

In order to support a just transition and help low-income Member States and their regions that might face a more difficult path to decarbonize their economy, the EIB should provide assistance for developing transition plans that consider the specific needs of areas where the economy is still heavily reliant on fossil fuels. The investment outlay necessary to decarbonize the energy sector in these areas is significant, and the EIB should think of ad hoc instruments and financial support for Member States with GDP per capita below EU average.

To reinforce its impact towards a successful energy transition the EIB should cooperate with national development and commercial banks in each country. The EIB’s instruments should be complementary and work together (rather than compete) with national energy efficiency programmes.


In the case of new buildings, do you have an opinion on the proposed approach to support only buildings that go beyond the mandatory nZEB standard after 2021? What level of ambition should the Bank focus upon, inside and outside the EU?

In Europe, the buildings sector is responsible for around 40% of final energy consumption and nearly 36% of total direct and indirect CO2 emissions. 97% of the EU building stock is still in urgent need of an energy efficiency upgrade (cf BPIE). This is why if the EIB wants to achieve real impact it should support new and existing buildings and their deep staged renovation. According to the revised EPBD, each Member State needs to establish a national long-term renovation strategy to support the renovation of residential and non-residential buildings, into highly energy efficient and decarbonized building stock by 2050, facilitating the transformation of existing buildings into nearly zero energy buildings (nZEB).

We also suggest exploring the possibility of creating a financing framework that would help Member States achieve highly efficient and decarbonized building stock by 2050 and to enhance smart technologies and technical building systems.  In this way the EIB would properly contribute to the financing of the kind of infrastructure that will be needed as part of the future smart and energy efficient system.


The Bank has developed a number of financial and technical assistance products to help promote energy efficiency in private and public buildings. Have you had any experience with these products? If so, do you have a comment or opinion as to how they can be further developed or improved?  

We often hear that EIB’s lending is not accessible for many local authorities, in particular for smaller and medium-sized municipalities, due to the fact the application process  demand high investment and significant human and technical resources. This limits the access to financial and technical support for energy efficiency projects in a large number of smaller and medium-sized cities.

Regarding the technical assistance (in particular the ELENA mechanism), the simplification of application procedures should be considered, especially when it comes to enabling partnerships between public and private sector for buildings renovation projects. Public-private cooperation should be promoted to ensure the needed technical assistance for municipalities.

The EIB has the potential to play a key role in supporting Member States in the development and promotion of the Energy Performance Contracting model for comprehensive public building renovation. EIB’s lending for energy efficiency should be aimed to maximise the opportunities offered by the recent revision of the accounting rules for public building renovation under Energy Performance Contracting (EPC). In addition, to further increase the uptake of EPCs, the EIB should facilitate the combination of EPCs and ESIF funds and provide specialised technical advisory for municipalities.


 In light of the long-term nature of the network development plans, which type of projects should the Bank focus upon? In addition to PCIs, should the Bank prioritise newer investment types, for instance in digital technologies?

The bank should focus only on sustainable projects, the ones that will not be detrimental to the Paris Agreement. The role of the EIB should be to accelerate and deepen the energy transition, not to slow it down by continued investments in new fossil fuels  infrastructure with long-term lock-in effects.

Therefore, we support a revision of the TEN-E regulation, as included in the deal that was reached early March, between the European Parliament and Council on the Connecting Europe Facility. The aim should be to align the TEN-E Regulation (and the subsequent Projects of Common Interest, PCIs) with the Paris climate agreement. Awaiting that revision, the EIB should abstain from automatically supporting PCIs projects, since other assessments are needed to ensure that all EIB-supported projects are in line with the Paris Agreement. This is all the more important that funds could be rerouted towards investments in energy efficiency and demand side response, which can have significant security of supply impacts. The current economic appraisal methodology focuses on physical supply disruption of big infrastructure projects, looking at the impact of largest piece of infrastructure not being available. The Bank should adapt this methodology so that the aggregate effect of a large energy efficiency or demand side response programme can be quantified as well.

In addition to PCIs, the EIB shall consider new fields of investments such as Distributed energy systems  (DES) such as high efficiency and low carbon district heating networks and new types/categories of projects, covering for instance the energy efficient renovation of entire neighbourhoods and districts. Local and regional energy transition initiatives should be at the heart of the Bank lending policy as energy transition and effective decarbonisation can only be  adequately constructed and carried out at the level of territories. New digital technologies should also be areas of interest of the bank.


 What is your view on the investment needed in gas infrastructure to meet Europe’s long-term climate and energy policy goals, while completing the internal energy market and ensuring security of supply? What approach could strike the right balance to prevent the economic risk of stranded assets?

The EU needs to be consistent across its public funding and EU policies regarding a clear pathway towards a net zero emission economy. That is needed to provide private investors with the certainty that they can invest in new (clean) technologies, production facilities and the like. Continued investment in fossil fuel projects is inconsistent and incompatible with the Paris Agreement and long-term decarbonisation targets. That means that the EIB should not invest in new fossil fuel infrastructures and by doing so, misuse scarce public resources. Investing in new fossil fuels-based facilities would lock-in investments in technologies of the past for decades to come and lead to the creation of stranded assets. Instead, we need to invest in the future efficient energy systems, which will bring multiple economic, environmental and social benefits.

In addition, and as mentioned above, the EIB should fully apply the Energy First principle and therefore require from projects promoters to systematically assess the economic opportunity to reduce energy consumption first, through cost effective energy efficiency solutions, before investing in any new sustainable supply capacities. In our view, all investment decisions in the field of energy and climate change must be guided by the long term decarbonisation objectives. Faced with the challenge of scarcity, public resources should be spent in the most intelligent, efficient and effective way, paying due attention to aspects such as just transition, and prioritizing areas with the highest economic, societal and environmental value, such as efficient operation of buildings and their comprehensive renovations.