Negotiators are “very optimistic” about closing a deal on the draft directive after today’s last so-called ‘trialogue’ talks between the European Commission, Parliament and Council.
Over the past six months, the Council, which represents the EU's 27 member states, has persistently weakened the draft directive, with the European Commission estimating it now only carries 38% of its initial energy savings potential.
“Yesterday we prevented the directive from exploding," said Green MEP Claude Turmes, in charge of the negotiations on behalf of the Parliament.
"We saved it. We had to bring the French government to go against Germany, we managed that and from now on the dossier can go on,” Turmes told journalists on 7 June, after the last meeting with the member states.
Whilst the directive has gathered some strong “friends”, a few countries with a big say in the negotiation could still delay an agreement on it. Finland, Portugal, Spain, Estonia, Slovakia and the Netherlands are amongst the most reluctant countries.
Merkel 'the biggest disappointment'
But according to Turmes, “the biggest disappointment is Merkel's position”.
“It is insane what she is doing, she is boycotting the negotiations, Germany is destroying the directive,” Turmes said.
The Parliament negotiator recalled that the directive came as a result of the March 2007 EU summit, which was attended for the first time by the newly elected German Chancellor Angela Merkel. Stepping out of the summit, Merkel triumphantly announced that she had struck an agreement on a 20% energy efficiency target by 2020, together with a 20% renewable energy target and a 20% CO2 reduction target.
Jacques Chirac, the French president at that time, gushed that Merkel had “worked with intelligence and elegance" while others called her deal “ambitious” and “credible”, saying she had brought “qualitative difference”.
The efficiency goal is the only one of those three objectives that the EU has not followed up with a dedicated piece of legislation.
And, “until a week ago, the German government had no position" on the draft energy efficiency bill, which the European Commission tabled in summer 2011, Turmes said.
“Germany has never been so against an EU policy,” he added.
UK 'blackmails', Germany 'betrays'
The UK is also weakening the directive, article by article, asking for reduced ambitions in exchange of London's cooperation on the bill, Turmes said, adding that the UK has convinced other member states to go against the bill and ask for exemptions.
“The Green Deal is more and more a smokescreen," Turmes said in reference to Britain's position. "The greenest government ever is an impostor, they have no money and no ambition behind words,” he added, referring to Prime Minister David Cameron's claim of being "the greenest government ever" when he came to power.
“We have been betrayed by Merkel and we are everyday blackmailed by Cameron and Osborne,” the MEP from Luxembourg said.
The outspoken Turmes is an an experienced Member of the European Parliament with a track record in brokering agreements on difficult pieces of energy legislation such as the 2009 renewable energy directive and the second energy liberalisation directive.
As lead Parliament negotiator on the draft efficiency directive, he managed to squeeze over 2,000 amendments tabled by the different political groups in the Assembly into 18 amendments in just over a couple of months.
In negotiations with member states, he fought a battle over the most critical articles, defending binding targets, and paying "diplomatic visits" to several EU capitals.
Turmes' last such visit to Paris marked a shift in France's position after the new Socialist government was sworn in. “Before, the French position got worse every week and you could see the spirit of EDF and Total in the negotiations,” the MEP recounts, referring to leading energy companies.
Now, the French publicly supports the directive's main provisions, including a 3% annual renovation rate for public buildings and an obligation on energy retailers to slash their sales to households by 1.5% annually.
However, some member states may have good reasons to be cautious about their spending.
"Negotiations on the Energy Efficiency Directive have been overshadowed by the financial crisis which has dampened the ambition of the member states," said Fiona Riddoch, managing director of COGEN Europe, the European association for the promotion of cogeneration. She spoke to EurActiv in an interview.
Spain, which has just won EU approval for a bailout of its ailing banking sector, claims implementing the bill will be too costly for its already tight austerity budget, according to Danish Social-Democrat MEP Britta Thomsen.
Indeed, the Danish presidency estimates that implementing the directive would cost €24 billion a year until 2020. However, it would also save the economy €44 billion in fuel expenditure and investments in energy generation and distribution.
The European Commission has estimated that the directive will increase the EU's GDP by €34 billion in 2020, and create 400,000 jobs.
But many civil servants are happy with their existing energy system and do not want to change it through the back door, according to an official close to the talks. “A lot of resistance has to do with finance ministers saying they do not know how to get this money”.
“But they have signed up to 20% energy efficiency targets”, he added.
Directive to miss 20% energy savings target
Member states have long rejected a legally binding energy efficiency target of 20% by 2020.
However, the Parliament has vowed to fight for targets until the last moment. Turmes has calculated that the current compromise would result in only 14.5% of the 20% energy savings goal by 2020 that member states have agreed on in principle. He says the Parliament is willing to settle for just a little more than that.
"We need 15%, we will not move under that,” Turmes said.
To close the gap, Turmes asked the Commission to come up with innovative proposals. One option pushed by the Parliament negotiator is to include the transport sector, which has been left out of the directive ever since the initial proposal was put on the table almost a year ago.
“The Commission has to come up with a credible enough proposal,” Turmes said, adding that he will try to “squeeze as much as possible” in the last leg of the race.
But the 20% energy-savings target has now effectively been abandoned. "The directive will bring us one step closer to the target, but will not close the gap," a source close to the Danish presidency said.
And no one seems enthusiastic about moving the bill into a second reading, which would likely take place during the Irish EU presidency in the first half of 2013. “That's something we need to discuss, we have to think whether the governments that are now in power in the UK or Germany will change by next year or not,” Turmes said.
One source close to the negotiations said delaying an agreement would be “a waste of time”.