Energy savings: The stimulus Europe needs

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV.COM Ltd.

This article is part of our special report Energy efficient buildings : Powering Europe.

European leaders have to understand that the greatest source of energy in the future will be learning how to use it more efficiently, say Sam Hägglund and Ulrich Paetzold.

Sam Hägglund is General Secretary at the European Federation of Building and Woodworkers (EFWBWW), and Ulrich Paetzold is Director General at the European Construction Industry Federation (FIEC).

Sam Hägglund is General Secretary at the European Federation of Building and Woodworkers (EFWBWW), and Ulrich Paetzold is Director General at the European Construction Industry Federation (FIEC).

"Europe’s leaders will gather on 23 May to consider how they can shift the EU economies from stagnation to growth. This is welcomed news. There will be lots of talk of how to stimulate the economy, get people back into work and break the downward spiral in ways that are affordable and long lasting.

The task may seem challenging, intractable, even beyond their reach, but there is one obvious and little-talked-about policy option that offers a very helpful answer. It may surprise many because it is so simple.

The option is saving energy.

At first glance energy savings might not appear exciting to politicians. It isn’t sexy and doesn’t tend to win votes. However, unlike a lot of ideas that have immediate appeal to politicians that were tried in the last economic stimulus, it actually works.

Politicians need to understand that rather than regarding energy savings as some sort of add-on thought, they should see it as an actual fuel source. If someone was to point out to President François Hollande or to Chancellor Angela Merkel that they could find 2.5 billion barrels of oil under the Arc de Triomphe or the Brandenburg Gate, you can bet your bottom dollar they’d start digging pretty quickly.

The irony is that they are actually in possession of exactly these kind of riches – meeting current EU targets on energy efficiency would lead to a saving of over 2.6 billion barrels of oil equivalent per year by 2020. As Bill Colton, Vice President for Corporate Strategic Planning at ExxonMobil, said in a seminar in Brussels on 8 May: “The greatest source of energy in the future will be learning how to use it more efficiently.”

If senior executives at ExxonMobil understand this, why is it taking European leaders so long to catch on?

Not only is investing in energy savings straightforward common sense. It also has a positive effect on the lives of hundreds of millions of people. The homes they live in would cost less to heat and cool, the appliances they use would be cheaper to run, and the pollution caused by power stations, household boilers and engines would be reduced simply because they use less energy. Implementing energy savings legislation should be seen as a no-regrets option for our politicians, but would also be great news for consumers, businesses and the environmentalists.

Media interest in the 23 May meeting is likely to focus on the Merkel-Hollande dynamic – and of course, the relationship between the leaders of the EU’s ‘engine’ is hugely important. But beyond the personality politics, it is critical for our leaders to recognise that their populations are watching with an expectation for answers that actually make long-term economic sense. They are looking for answers which will begin to finally turn the picture of austerity and stagnation into one of growth and hope.

Those looking for answers to Europe’s economic woes should be aware that, according to the Jülich Research Centre, for every euro spent on energy savings in Germany, €5 euro will flow back into government coffers. These savings are achieved thanks to new jobs created, a reduction in unemployment costs and additional tax revenues.

Right now, European politicians have a chance to trigger much greater investment in energy savings – and to start reaping these benefits.

A new Directive on Energy Efficiency is currently under intense negotiation in Brussels. If passed, this law could streamline financing for energy savings, lead to the mass renovation of public and private buildings, and stimulate a whole new market in energy efficiency. It has the potential to save €193 billion per year, create 400,000 net new jobs and avoid the need to build 1000 coal-fired power plants.

And yet so far, short-sighted fears that it will “cost too much” are leading most countries to do their level best to destroy the Directive.

The irony is that they cannot afford not to act. Europe needs hope, and it needs it now. Our more enlightened European leaders should do more to help their counterparts to realise that investing in energy savings is the best way to stimulate Europe’s economic recovery.

The meeting on the 23rd May is the perfect opportunity to acknowledge this – before translating sentiment into action straightaway, by agreeing to a strong EED."

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