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From Energy efficiency obligation to carbon savings certificate to achieve carbon neutrality: does it fit the path?

Panel: 2. Efficiency and beyond: innovative energy demand policies

This is a peer-reviewed paper.

Authors:
Dominique Osso, EDF-R&D, France
Nadège Chatagnon, EDF, France
Aurélie Orcibal, EDF, France
Eric Gasparotto, EDF, France
Marc Berthou, EDSF, France
Hugues Bosche, EDF, France
Cyril Dronet, EDF, France
Jean-Marc Lauruol, EDF, France

Abstract

One way to contribute to carbon neutrality in 2050 is to reduce energy consumption but this will not be enough. To this end, many energy policy instruments (regulations, taxes, incentives, etc.) have been used for many years and well before the goal of carbon neutrality and need to be reassessed to be in line with decarbonisation especially in the context of the EED review.

In many European countries, energy efficiency obligation schemes (EEOs) are used in line with EED article 7. These schemes are usually expressed in terms of primary energy savings as in Italy or final energy savings as in France and to our knowledge only one which has been expressed in terms of carbon as in the UK. Initially the UK EEO was expressed in energy and moved from energy to carbon. However, this movement has not been followed in Europe, even though European policy is increasingly focused on reducing carbon emissions.

There are several ways of integrating carbon into an EEO scheme: from the simplest by considering the carbon content of energy when sharing the level of obligation among obligated parties to the most complex by valuing the certificates directly in carbon units.

By considering both energy and carbon in the same EEO scheme, a double reward is possible to reduce consumption and promote low carbon energy. In this way, new energy savings and carbon reduction potentials could be incentivised, especially in industry and transport in case of fuel switching.

Including carbon in the scheme also means putting a price on carbon in the market, beyond a shadow value for sectors not covered by the historical EU-ETS I without the need to extend the EU-ETS to the building and transport sectors (EU-ETS II).

This paper aims to challenge this situation and to propose a shift from energy to carbon in an EEO scheme. To do so, we propose to take the case of the French EEO as an example and to assess how this existing scheme can evolve to better integrate the carbon dimension and contribute effectively to the national carbon mitigation strategy.

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