Gierek: Energy efficiency requires huge investment, but it will pay back

I do not exclude the 40% energy efficiency target on condition that all three stages of the energy flow are included, Adam Gierek told EURACTIV Czech Republic.

Prof. Adam Gierek is a Polish Democratic Left Alliance lawmaker (S&D). He is the rapporteur on the revised Energy Efficiency Directive that the Commission proposed within the Clean Energy Package in November 2016.

Gierek spoke to Editor-in-Chief Adéla Denková.

You are the Parliament’s rapporteur for EED. A majority of MEPs have already called for a more ambitious policy than the European Commission’s proposal. Do you support the 40% energy efficiency target?

Calls for a higher ambition in the energy efficiency target are based on the climate agreement from COP21 in Paris, because efficient use of energy results in less CO2 emissions. As you already said, the Parliament voted in a non-binding resolution for a 40% target. The Commission proposes 30%. In the draft report on the EED revision, I have come with the proposal for a 35% target. I think this question should be subject to further debate.

What would make you support the higher target?

I do not exclude a more ambitious solution on condition that all three stages of the energy flow are included in the energy efficiency policy, from the primary energy to the energy conversion and further to the final use of energy at the market. If such holistic approach is adopted, I am ready to support 40% target. I think it is realistic and much needed, as the improvement of the whole energy system would help us reduce CO2 emissions significantly.

What exactly does it mean when you say that “all three stages of the energy flow will be included”?

If you are asking for some examples, we can look at the efficiency of energy conversion in coal power plants which is lower than 40%. That means 60% of primary energy is lost at the production stage. It is even worse in nuclear power plants. So there is a big potential for a better use of primary energy. There are huge losses at the stage of energy transmission as well. At high-voltage power lines it can be even 40% or 60%, depending on the distance. Talking about the market, housing sector has the biggest potential for savings. Two-thirds of the buildings in the EU have not been renovated yet.

Do you see differences in the energy savings potential of different sectors? Some people say, for example, that it will be hard to achieve new savings in industry.

Of course, there are differences. The potential in buildings is the easiest to realise, it can be fulfilled very quickly and also brings the benefit of lowering energy poverty. But it is also important to say that the potential differs across Europe because of climate conditions. In Central Europe, you can use even more than 200 kWh per square meter per year in a house which is not insulated. In an insulated building it may be around 40 kWh, and in passive houses it can be even 20 kWh or less. These are huge reserves. Of course, in Spain, Italy or Malta, it is something completely different. But generally speaking, we can gain a lot in a short time and moreover, improving energy efficiency in buildings will create new jobs and help the much-needed reindustrialization of Europe.

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On the other hand, according to the impact assessment provided by the Commission, 40% target will also bring much higher investment costs in comparison to 30% target.

The impact assessment is based on an economic model and the Commission has probably not taken into account the things that I talked about at the beginning. It relies only on the estimation of market reaction and the other two stages of energy flow are probably missing. I think we would need a new analysis or a new model. Getting back to your question – obviously, there will be a need for huge investments, but it will pay back.

You proposed that the energy efficiency target is expressed in primary energy consumption. This is one of the most controversial topics among the member states. Could you explain your position?

To meet the Paris Agreement obligations, the use of primary energy is an important indicator. The Commission talks about a target that is expressed in two ways – primary and final energy consumption. With such an approach, conversion of the data reported by various member states might be complicated. It is important that there is just one way of reporting. I like to use the example of an apple and an apple strudel. The apple is the primary energy – but the strudel is not anymore a fruit, it is a processed apple. We need to compare the efficiency of different energy mixes based on a common indicator, which is the so-called primary energy factor.

I am an advocate of a holistic approach. That is for example why I also think that the transport sector should always be included in the calculations of energy saving according to the Article 7 of EED and it should not be deleted in the frames of so called flexibility – which is a position promoted by Germany, for example. We should always think about energy efficiency in electricity sector, transport and housing – these three pillars should be always present. This is also why it will be better to convert all reporting into primary energy use, so that there is no confusion.

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