The European Commission on November 30 presented a package of measures to keep the European Union competitive as the global clean energy transition is changing the energy markets.

As an encompassing element, the Commission proposes a binding EU-wide target of 30% for energy efficiency by 2030.

The Commission noted that the package proposals have three main goals: putting energy efficiency first, achieving global leadership in renewable energies and providing a fair deal for consumers.

European Commission Vice-President for Energy Union Maroš Šefčovič said the package presented on November 30 would boost the clean energy transition by modernising Europe’s economy.
“Having led the global climate action in recent years, Europe is now showing example by creating the conditions for sustainable jobs, growth and investment. Today’s proposals touch upon all clean energy related sectors: research and innovation, skills, buildings, industry, transport, digital, finance to name but a few. These measures will equip all European citizens and businesses with the means to make the most of the clean energy transition,” Šefčovič said.

Meeting Climate Targets

For his part, Commissioner for Climate Action and Energy Miguel Arias Cañete said the proposals “provide a strong market pull for new technologies, set the right conditions for investors, empower consumers, make energy markets work better and help us meet our climate targets. I’m particularly proud of the binding 30% energy efficiency target, as it will reduce our dependency on energy imports, create jobs and cut more emissions”.

Europe is on the brink of a clean energy revolution, Cañete said, adding that the Commission has cleared the way to a more competitive, modern and cleaner energy system.

“Now we count on European Parliament and our Member States to make it a reality.” The Commission’s ‘Clean Energy for All Europeans’ proposals are designed to show that the clean energy transition is the growth sector of the future – that’s where the smart money is. Clean energies in 2015 attracted global investment of over 300 billion euros,” Cañete said.

“The EU is well placed to use our research, development and innovation policies to turn this transition into a concrete industrial opportunity. By mobilising up to 177 billion euros of public and private investment per year from 2021, this package can generate up to 1% increase in GDP over the next decade and create 900,000 new jobs,” he added.

The clean energy transition is important for the current European strategy for jobs and growth, the number one priority of the Juncker Commission.

When implemented by Member States, some proposed measures would have immediate and tangible effects. Ambitious energy efficiency targets for 2030 can reduce a Member State’s dependence on energy imports, boost the local economy, increase its competitiveness and create additional green jobs, the Commission said.

Buildings Directive

Moreover, 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. On top of the legislative proposals, the Commission is also proposing a set of facilitating measures to support, already before the legislation enters into force, the objectives of the Energy Union and the modernisation of the construction sector and its workforce.

By 2020, the Ecodesign policy is expected to deliver yearly energy savings equivalent to the annual energy consumption of Italy. As a result, European households can save up to €500 per year on their energy bills. Moreover, this policy is estimated to deliver approximately €55 billion per year extra revenue for industry, wholesale and retail sectors, which supports jobs and growth in Europe’s economy, the Commission said.

In addition to this, the measures announced in the Ecodesign working plan for 2016-2019 have the potential to deliver further energy savings by 2030, which are equivalent to the annual energy consumption of Sweden and deliver commensurate benefits for consumers, businesses and the environment, the Commission added.

Energy Efficiency

Moreover, as the need to mobilise and unlock private investment is key for a successful energy efficiency policy, the Commission is launching the Smart Finance for Smart Buildings initiative. This initiative can unlock an additional € 10 billion of public and private funds until 2020 by: encouraging more effective use of public funds including through the development of flexible energy efficiency and renewable financing platforms to boost the combination of the European Fund for Strategic Investment and other public funds, including European Structural Investment Funds; helping project developers bring good project ideas to maturity with more project development assistance and aggregation mechanisms; making energy efficiency investments more trusted and attractive for project promoters, financiers and investors, the Commission said.

Energy efficiency has a direct impact on lowering the energy bill. It is also a vast and growing business opportunity that European businesses are particularly well placed to exploit, the Commission said.

Overall, the Commission noted that the whole 2030 energy and climate package could boost the EU’s GDP by up to 1% by 2030, pumping an additional €190 billion into the EU’s economy and creating up to 900,000 new jobs.

Energy efficiency is also one of the most cost-effective ways to ensure energy security, the Commission said. “It has strong beneficial impacts on security of supply and the level of gas imports, in particular. Compared to 27% target, an ambitious 30% energy efficiency target will improves energy security by reducing fossil fuel imports by 12% in 2030 which correspondents to import saving of 70 billion euros,” the Commission said.

Energy efficiency also contributes to the reduction of greenhouse gases and goes hand in hand with renewable energies to enable the energy transition, the Commission said, adding that it is also an integral part of the Energy Union Governance – which frames the member states’ contributions to the binding EU-level efficiency target as part of their Integrated National Energy and Climate Plans.

Tackling Energy Poverty

The Commission also vowed to tackle energy poverty. The package released on November 30 sets out a new approach to protecting vulnerable consumers, including by supporting energy efficiency investments. The Commission’s energy efficiency proposals ask Member States to take energy poverty into account, by requiring a share of energy efficiency measures to be implemented as a priority in households affected by energy poverty or in social housing. Their long-term building renovation strategies should also contribute to the alleviation of energy poverty, the Commission said.

Mixed Reactions

Reactions to the Commission’s package were mixed. S&D Members of the European Parliament welcomed the package. “The Commission promised to deliver 90% of the Energy Union strategy by the end of 2016 and we are happy to see that under the leadership of vice-president Maros Šefčovič it is keeping its word. We need to start working on these solid foundations as soon as possible,” Kathleen Van Brempt MEP, S&D Group vice-president for sustainability, said. “Nevertheless, significant improvement is needed, such as raising the level of ambition for both energy efficiency and renewables, especially in light of the COP21 climate change agreement.

Jerzy Buzek, chair of the EP committee on industry, energy and research, said the European Commission has certainly lived up to its promise of making 2016 the year of delivery for the Energy Union. “With the robust package released today, the Commission has now proposed more than 80% of legislation needed to make this strategy work,” Buzek said.

“The European Parliament has repeatedly underlined that the cornerstone of the Energy Union must be a well-connected and fully operational Internal Energy Market. The package should help us adapt the market to new trends in generation, consumption and saving of energy. It should also enable us to increase our independence and energy security by making efficient and sustainable use of all Europe’s indigenous energy resources, including renewable energy,” Buzek said.

However, the WWF European Policy Office said the Commission’s clean energy package is still too dirty. “The EU led the world on climate change. And the world has followed as the need for action becomes ever more urgent. But the Commission’s clean energy package is still too dirty. Far from accelerating the energy transition the proposals leave the door open to subsidies for the next ten years,, undermine support for renewables, and miss some big opportunities on energy efficiency. The Commission also seems to think that a good way of tackling climate change is to burn more trees,” Imke Lübbeke, Head of Climate and Energy at WWF European Policy Office, said.

Greenpeace warned that the package of policy proposals released by the Commission threatens to derail efforts to accelerate the roll-out of renewables, while prolonging subsidies for coal.

“These draft laws are designed for polluting power companies, not for European citizens,” Greenpeace EU energy policy adviser Tara Connolly said.

“Not only is the Commission slamming on the brakes on renewables, it wants to let governments dole out cash to almost all coal power stations in Europe for at least another decade. If this goes ahead, it will seriously impact the EU’s ability to meet its Paris climate commitments and constrain the potential of citizens as renewable energy producers.”

Meanwhile, the European Solar Thermal Industry Federation (ESTIF) welcomed the new focus on renewable heat in the new Renewable Energy Directive, although regretting several incoherences in the Winter Package, and an overall low level of ambition for the renewable energy sector.

UEAPME also welcomed the Clean Energy Package. As far as the proposed directive on Energy Efficiency is concerned, UEAPME welcomed the fact that the article on “Energy audits and Energy management systems” remains untouched and hence, energy audits for SMEs remain voluntary. UEAPME Secretary General Peter Faross said: “making energy audits mandatory for SMEs would be too expensive and burdensome for them. In spite of this, we are pleased with the current system where Member States have to put forward programmes supporting SMEs to undergo energy audits and, more importantly, they have to implement the recommendations from these audits”. Nevertheless, UEAPME said it would like the Commission to ensure these programmes do indeed exist and are implemented at national level.