Negotiators from the European Parliament, Commission and Council reached a deal on the Energy Efficiency Directive last night (13 June). But it fails to achieve its initial purpose of reaching 20% energy savings by 2020, the Parliament's chief negotiator has warned.

Claude Turmes, the Green MEP from Luxembourg who was leading the negotiation on behalf of the European Parliament, appeared moderately satisfied after the agreement was struck.

“This deal will give a boost to Europe's economy and help achieve our energy security and climate goals," he said.

"The new energy efficiency legislation sets out binding measures, which will go a significant way towards bridging the current gap the EU is facing with regards to meeting its pledge to reduce energy consumption 20% by 2020,” he explained.

However, just last week, Turmes had calculated that the current compromise would result in only 14.5% total energy savings by 2020, well short of the 20% goal that member states had previously agreed on in principle at an EU summit in 2007.

Before entering the negotiation with member states and Commission yesterday, the outspoken Green MEP told EurActiv that the Parliament would settle for a 15% energy savings goal as an "absolute minimum”. 

In fact, he might have obtained more.

British liberal-democrat MEP Fiona Hall said today (14 June) that "the directive will now achieve 17% of the 20% energy efficiency savings needed by 2020 - compared to less than 15% before last night".

“Unfortunately, EU governments were not willing to agree to more ambitious measures, which would have fully delivered the 20% target,” Turmes said after the so-called trialogue talks with the Commission, Parliament and Council.

In order to close as much of the gap as possible, Turmes has asked the Commission to propose additional measures for transport, which are now part of the deal, Turmes said. These could result in new standards for car fuel efficiency, he explained.

“The Commission has to come up with a credible enough proposal,” Turmes said before entering the meeting yesterday.

Squeezed from all sides

Brook Riley of Friends of the Earth Europe, an environmental group, said the 20% target will not be reached because the most ambitious measures in the directive “have been squeezed from all sides”.

Under the Commission's initial proposal, energy companies were requested to reduce their energy sales to industrial and household clients by at least 1.5% each year.

But member states have obtained that a quarter of the 1.5% annual obligation can be achieved through a series of different measures. This will be broken down in the following way:

  • ETS: 40% of the efforts that industries already make under the EU Emissions Trading System for carbon dioxide (EU-ETS) will now be accounted for in the yearly obligation.
  • Early action: Member states will be able to include “early action" in their energy savings goals, allowing them to credit savings measures launched before the EU law comes into force.
  • Future action: Countries will be able to count not only current, "real" savings, but also “future actions” in their national energy savings schemes.
  • Savings at source: Countries will also be able to count energy savings made at the source, in the energy transformation sector, before it is distributed to clients. This will account towards a further quarter of the 1.5% obligation.

“All these measures can replace a quarter of the 1.5% energy savings obligation. That means that the level of the target has been reduced to 1.1%,” Riley said.

Moreover, it was agreed that all the different measures in the directive will be gradually phased in, allowing more time for EU member states and industries to prepare.

UK threatened to blow up the deal

Despite those concessions, the Danish EU presidency, which shepherded the negotiations, can probably be satisfied that the deal was passed as the talks appeared close to collapsing.

At the last minute, the UK asked for additional exemptions for countries that have already adopted savings schemes for energy retail companies. This applies only to the UK, Denmark, France and Italy.

“The UK made this exemption loophole a condition to accept the deal," Riley said, adding: "They threatened that otherwise they would block the deal" at a meeting of EU ambassadors Coreper) taking place on Thursday evening (14 June).

According to Riley, “the UK has clearly been one of the worst” in the negotiation. “It is a paradox, because on the one hand the UK is saying that it is committed to green policies, but on the other hand here they are opposing energy savings legislation which would deliver their commitment." 

Riley estimates that the agreement on the energy efficiency directive represents “only a small progress” compared to existing legislation and regrets that it has become “much weaker than it was six months ago."

"Governments have scored an own goal against their own commitments to cut emissions, save money and create jobs,” he said.

Last-minute additions: buildings renovation and smart meters

Still, during the last leg of the negotiations, the Parliament did manage to introduce some additional measures designed to guarantee further energy savings in the future.

The key measure there is an obligation on each EU member state to draw up a roadmap to make the entire buildings sector more energy efficienty by 2050 (commercial, public and private households included).

"It contributes to the framework and it is a long term outlook but it is not strong enough for 2020 – member states agreed to have them because they don't have to implement these roadmaps too soon," Erica Hope, of Climate Action Network said.

EurActiv understands this measure has been agreed in exchange for watering down a proposed 3% renovation rate for public buildings, which will now only address “central government-owned and occupied buildings”. In a country like Germany, where most public buildings belong to the regions, this reduces the scope to only around 37 buildings.

Other "detailed measures" that were added at the last minute include "binding financial instruments" for energy efficiency and "better consumer information," such as through the use of smart meters, Turmes said in a statement.