Columnists: Rod Janssen, Independent consultant

Published on: 14 Mar 2017

The Brussels Winter Package whirlwind

2017 is turning out to be a whirlwind of activity in the approval process for the European Commission’s clean energy package. In the past few weeks, I have been to Brussels several times, having meetings, workshops or conferences on reviewing the impact assessments, addressing energy efficiency financing and discussing the important role of consumers in the winter package.

Every waking moment seems to revolve around either the approval process or Brexit. Let’s not even think about Brexit for the moment. But the issues related to the approval process are important. Let’s just consider a few of the important elements.

The Target: The Commission proposed a binding 30% savings target for 2030, up from the current 27% non-binding one. While the European Parliament wants a more ambitious target, it appears that Council (representing member states) is much less ambitious. Whatever the target, my concern is whether energy efficiency is being well positioned to play the role it should in the EU meeting its obligations under the 2015 Paris climate agreement.  At a recent workshop organised by Leonardo Energy reviewing the relevant impact assessments, my take from it was that we should be aiming for greater ambition. Hopefully people will start connecting the dots and realise that improved energy efficiency really has a more important role to play.

Efficiency First: Thinking about the target makes one reflect back to the Energy Union’s commitment to Efficiency First, where energy efficiency is essentially the first filter in all energy policies. As the Regulatory Assistance Project (RAP) writes on its website  [http://www.raponline.org/efficiency-first-principle-practice/], “it prioritises investments in customer-side efficiency resources (including end-use energy efficiency and demand response) whenever they would cost less, or deliver more value, than investing in energy infrastructure, fuels, and supply alone.” When we think about the EU’s Emissions Trading System, it has been regularly argued that it is the main driver for energy efficiency in industry, for example.  Yet, in recent analyses discussed in Brussels, it is not delivering energy efficiency.  And, the winter package has essentially nothing for industry. There appears to be a disconnect.

On Efficiency First, I would like someone to explain to me that the other directives under review (renewables, governance and internal market for electricity) as well as accompanying initiatives, were developed under the Efficiency First principle. I hope so, but it is not obvious to me.

Renovation of buildings: The Commission wrote in its accompanying factsheets when it launched the winter package that “The changes proposed by the Commission in the Energy Efficiency Directive and the Energy Performance of Buildings Directive aim to speed up the renovation rate of existing buildings with a view to decarbonising the building stock by mid-century.” It is not obvious how this is going to happen. There are some initiatives such as Smart Financing for Smart Buildings that are welcome, but they do not appear to be leading to deep renovations on the scale needed. As the Energy Advice Exchange (EAE) https://energyindemand.com/energy-advice-exchange/ has argued, without effective energy advice, consumers are not going to undertake ambitious renovations on the scale needed. Member States are required to prepare renovation strategies (first under the Energy Efficiency Directive and now proposed to be under the Energy Performance of Buildings Directive) but there is no requirement to implement the strategies. In a recent review by the EAE, it appeared that many (if not most) member states did not even use those strategies as consultation documents in discussions with national stakeholders.

A consumer-centred clean energy package: Every page of the winter package gives attention to consumer needs. This is most welcome and long overdue.  At a recent conference organised by BEUC, the European Consumer Organisation, the clean energy package was discussed from the point of view of smart meters, allowing consumers to switch providers, bundling issues and consumer protection. They are all important, indeed. But the role of consumers in renovation strategies was not discussed, although it was finally brought up. Where are our energy savings to come from in the winter package? Yes, building renovations. Yet, without putting consumers first, regardless whether there are financing packages made available, it is surely doomed to fail.  The EPBD’s energy performance certificate, while useful, will not be the driver in ambitious renovations.

Final thoughts: It is my intention to be positive and push for a stronger, more effective winter package. It was frustrating that in the EED and EPBD, so few articles were opened for revision. To me, this does not make sense when we are going back to first principles – Efficiency First – and when we are finally on the verge of having energy efficiency play the role it should in our carbon mitigation strategies. Council and Parliament have much to do. The winter package has given them much homework to review and reflect on the analysis from the impact assessments and on the proposals for revising the directives. This also puts much pressure on the advocacy community (professional lobbyists and environmental groups) to also come to grips with the full range of themes and proposals raised by the Commission.

The Commission is to be commended for the package. This holistic, integrated approach has never happened before. It was a great effort.

Yet, now is the opportunity to make Efficiency First through making Consumers First. And through ensuring improved energy efficiency is positioned to play the role in our Paris-focussed low-carbon mitigation strategies.

There are many questions that remain to be answered. What is going on is a process that should include all of us, and not only those in Brussels. This is laying a foundation – no, THE foundation – for our low-carbon energy transition that will resonate for many years to come. We do not get many opportunities to take such major steps.

The work has only begun!

 


Other columns by Rod Janssen

Oct 2016

Apr 2016

Nov 2011