Content updated 21 February 2023.
Energy efficiency first principle
The “energy efficiency first principle” can be defined as taking utmost account of cost-efficient energy efficiency measures in shaping energy policy and making relevant investment decisions. It is seen as a far-reaching guiding principle that can complement other EU objectives, especially in the areas of sustainability, climate neutrality and green growth.
The European Commission regards energy efficiency as one of the key pillars to meet EU's climate objectives, to reduce dependence on fossil fuels from abroad and increase security of supply and the use of renewable energy.
The “energy efficiency first principle” is embedded in the Regulation on Governance of the Energy Union and Climate Action and in the Energy Efficiency Directive.
In the latest recast Energy Efficiency Directive, the Commission proposed a clearer priority for the “energy efficiency first principle”. The proposal included a formal recommendation to EU countries on the issue and detailed guidelines on its application, stating that the principle should also ensure that:
- only the energy really needed is produced
- investments in stranded assets are avoided
- demand for energy is reduced and managed in a cost-effective way
The principle aims to treat energy efficiency as a source of energy in its own right and give priority to demand-side solutions whenever they are more cost-effective than investments in energy infrastructure. It also emphasises the importance of reducing energy production, which can help control the level of investment needed for the transition towards renewables. It supports a more sustainable approach to the use of limited resources and increases the resilience of the EU's energy system.
The Commission intends to provide a stronger and wider legal basis for the application of the principle in the proposed Energy Efficiency Directive – Article 3 of proposal sets an obligation for EU countries to ensure that energy efficiency solutions are considered in energy system and non-energy sectors planning, policy and investment decisions.
