Energy savings deal pushed back to 2012

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EU energy ministers reiterated their opposition to binding energy savings targets at a meeting yesterday (24 November), leaving a political agreement for the incoming Danish presidency in the first half of 2012, EURACTIV has learned.
 

Poland, which currently holds the six-month rotating EU presidency, presented a progress report on the draft energy efficiency directive at a meeting of the Energy Council on Thursday (24 November).

The report included amendments pushed by member states requiring more “flexibility” in achieving the proposed targets.

Most EU member states “are not convinced of the approach and request flexibility to design schemes best suited for their circumstances,” the Polish presidency said, after holding consultations with all national delegations.

Member states were invited to present their positions but no extensive discussion was held at the meeting as views remain far apart. “If there will be a discussion, then it will be at a political level,” Polish presidency sources told EURACTIV.

Moves towards a political compromise are expected to start only as of 2012. “We expect the talks with the European Parliament to start during the Danish presidency,” a Polish presidency source said.

The progress report centred around the three targets contained in the draft energy efficiency directive:

  • A national obligation for energy companies to reduce consumption among "final consumers" by 1.5% annually;
  • A 3% refurbishment target for public buildings;
  • Setting up a "national heating and cooling plan" to promote heat and power co-generation as well as renewable energy in heating and cooling.

The first target is considered by experts as the one which "can really make member states take concrete action”.

Dutch reject binding target for energy companies

The flexibility changes sought by member states include replacing the cut-off 1.5% annual savings target with a gradual increase in objectives as well as the possibility to extend the time-period at national level in order to adjust to local circumstances.

But it was also abundantly clear that most do not want “a binding sectoral target,” EURACTIV was told. “It is a complex issue, in which all member states have a high interest,” an EU source said.

Germany, backed by The Netherlands, is hostile to the directive’s flagship 1.5% savings target for energy companies. The Hague even proposed a deletion of this particular article, it emerged earlier this month.

Meanwhile, other countries such as Italy, France and Denmark, which already have supplier-side obligations, support the proposed scheme if some changes are introduced.

Pascal Dupuis, head of the climate and energy efficiency department at the French Ministry of Ecology, said France supports the idea “99%”. Speaking at a conference organised earlier this month by EURACTIV France, Dupuis claimed the directive includes good ideas but says it is “too prescriptive at times”.

More flexibility sought

And while countries such as Denmark, Ireland, Belgium, Greece and a few others were broadly positive about the directive, the process remains stalled by countries which “still need to resolve internal fights between environment and economic ministers,” an EU analyst said.

“What countries need to have is a common system, but the problem is that they want their national system and think that by doing more they will move closer to a binding target that they will be monitored on and forced to implement against in all circumstances," said Sanjeev Kumar, a consultant for the Brussels branch of E3G, an environmental NGO.

"That is what wanting to be flexible means,” he told EURACTIV. "The Commission could not have been bolder than this,” he added, referring to the proposed directive, “considering it had to concentrate all efforts in a very concise direction, that of the 1.5% savings target”.

Proponents of greater energy savings saw the lack of progress in EU talks as an indication that member states were trying to derail the process and possibly kill the initiative.

Buildings' target set for amendments

One proposal likely to be amended is the 3% refurbishment target for all public buildings, with several delegations saying such obligations should be backed by additional sources of funding.

Britain for instance complained that the building renovation proposals were likely to result in “considerable extra expenditure for member states on works which are not always cost-effective”.

Buildings account for 40% of Europe’s primary energy consumption and 36% of its CO2 emissions. Experts consider that in terms of energy savings, the 3% target proposed in the energy efficiency directive is already very limited and that consumers’ bills will not see a reduction unless the target applies to all buildings.

BusinessEurope, the EU employer's lobby, believes that financing renovation of private buildings will have to attract more attention. Energy efficiency targets, it adds, should be counted in relative terms, as opposed to the total volume of energy saved, so that they do not constitute “a barrier to economic growth”.

The group also said that energy efficiency obligation schemes must be re-defined on criteria such as early actions and complement the programmes and laws in member states.

Environmentalists, meanwhile, urge for short term action. Even if budgets are tight, member states are failing to make the connection with the EU's longer term budget for 2014-2020 which contains a proposal to earmark 20% of the European Regional Development Fund (ERDF) for energy efficiency and renewables.

“If we don’t make the investment in the short term, there will be no long term,” stressed Sanjeev Kumar from the E3G environmental pressure group.

Fatih Birol, chief economist of the International Energy Agency (IEA) warned that consumers faced a near-term rise in oil prices of $150/barrel if no measures were taken to save energy. Speaking at a conference in Brussels, Birol said energy efficiency measures should account for about half of the reduction in CO2 emissions required to keep climate change under control.

However, the IEA's latest energy outlook report has worsened on a global economy scale, for the second year in a row, he warned.

Arianna Vitali Roscini, policy officer for energy conservation, WWF European Policy Office said: "It is a paradox that the Energy Council looks at the external dimension of the EU energy policy as one of the tools to strengthen security of energy supply in Europe while watering down the Energy Efficiency Directive. Renovating Europe’s buildings and ensuring that energy companies help consumers save energy in their homes, will cut bills and reduce our reliance on imports."

Energy efficiency is one of the EU’s three 20-20-20 targets for the decade, along with increasing the use of renewable energies to 20% of its overall energy mix and reducing greenhouse emission by 20%. 

Unlike the other two goals, however, the energy efficiency targets are not legally binding and it is the only one that the EU is set to miss.

  • Mid-Dec. 2011: New draft energy efficiency text to be discussed in a Council working group.
  • 1 Jan. 2012: Denmark takes over presidency of the EU.
  • Jan.-Feb. 2012: First discussions on the directive between member states.
  • International Energy Agency:Website

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