Deal on energy end-use efficiency leaves EU nations in charge

An agreement on energy savings at distribution and retail level requires member states to draw up national action plans on energy savings. However, the 1% annual savings target remains non-binding.

The European Parliament and the Council of Ministers on 6 December reached a compromise on a directive aimed at increasing energy savings from operators all along the electricity and gas supply and distribution chain right up to the delivery point. The agreement is expected to win formal approval from both institutions before the end of the year.

The compromise text requires member states to draw up national action plans to achieve a 1% yearly energy savings in a wide-ranging number of sectors including agriculture, household heating and transport. The target is only indicative but the national plans will have to be submitted to the Commission for approval and will be reviewed every three years. The process will be spread over nine years, starting in January 2007.

“With this initiative, each citizen will be able to see what is actually really done and the Commission can take further measures in case the member states ‘action plans’ would not be sufficient,” said Mechtild Rothe MEP (Germany, PES) who was steering the dossier through Parliament.

The issue of targets has remained central to discussions on the draft energy end-use efficiency and energy services directive. Member states have repeatedly stated their preference for non-binding targets and a flexible approach while Parliament had supported higher, legally binding targets.

The directive is chiefly addressed to “energy distributors, distribution system operators and retail energy sales companies” of large size. Member states “may” therefore exclude small distributors, small distribution system operators and small retail energy sales companies from the measures.


MEP Mechtild Rothe said: "Despite the disappointing attitude of some member states, the regulation does have a clear meaning. We have succeeded in not only developing clear purposes but also in member states having to work regularly on energy efficiency action plans. Both consumers and European governments will realise that energy efficiency, for instance the transport sector, electronic equipment and office is for all a win-win situation".

Claude Turmes MEP (Greens/EFA, Luxembourg) said the agreement was the best that could be achieved considering member state reluctance and the Parliament's conservative majority. It is now up to the member states to take action, Turmes pointed out, saying he hoped NGOs will apply enough pressure on governments to "push these minimum targets to a higher level". Turmes cited Denmark as an example where measures and targets are binding.

EU Energy Commissioner Andris Piebalgs said the point is that member states will have to take measures and that those will be reviewed regularly. "We have indicative targets but mandatory measures," Piebalgs pointed out. He said the focus should now lie on implementation measures at member state level and insisted on the Commission's responsibility in reviewing them.

EuroAce, the association representing the energy efficiency industry, welcomed the deal as "excellent news". "Of course we regret that the final text contains no absolutely binding national efficiency targets. But we believe that purposeful implementation of its main requirements can still deliver substantial benefits". These, says EuroAce, include stricter requirements on energy performance on public procurement as well as a new role for electricity and gas companies.  

The WWF criticised the compromise for being too weak on energy efficiency targets. The 1% non-binding yearly target was described by WWF as "an ignominious result, considering that the EU has the potential to save at least 2.5% a year". ""EU Members States recognise that energy efficiency provides a win-win solution for the environment and the economy. But the EU has once again refused to undertake serious commitments to achieve this goal," the WWF said.


The proposal, tabled in 2003, seeks to increase energy savings all along the supply chain right up until the retail stage when energy is sold to consumers. The draft covers the retail, supply and distribution of electricity and natural gas, as well as other major energy services including urban heating, heating fuel, agricultural energy products and transport fuels.


  • 13 December 2005: compromise to be presented for approval by Parliament in plenary session
  • If voted on as expected, the UK Presidency will put the matter on the agenda of a forthcoming Council meeting for final approval (maybe General Affairs or Agriculture Council)
  • 30 June 2007: deadline for member states to submit their first energy efficiency action plans
  • 30 June 2011: deadline for second round of action plans
  • 30 June 2014: deadline for third round of action plans

Further Reading