According to a recent report by the International Energy Agency (IEA), energy efficiency efforts are slowing down to their lowest rate since the start of the decade. They are dropping well below the minimum of 3 percent required to achieve global climate and energy goals. A mix of economic and social factors, as well as a lack of investments, prevented an addition global economic growth worth 2.6 trillion US dollar, if the 3% rate had been reached.
In Europe, the lack of efforts in energy efficiency is an issue as well. The European Union (EU) is on the verge of missing its 2020 energy efficiency target. What is more is that the latest Eurostat data show a greater gap in reaching this target in primary energy than final energy. This suggests that the energy system is becoming less efficient, running counter to the EU goals, and that there is a growing untapped potential for more efficiency in the generation, transmission and distribution of energy.
Despite the economic and environmental benefits of energy efficiency, EU Member States fail to sufficiently consider energy efficiency in their policies. As pointed out recently by the European Commission (EU), this is illustrated in their National Energy and Climate Plans (NECPs), expected to be released by the end of this year to help them achieve the 2030 EU climate and energy targets. Energy efficiency measures proposed by EU Member State in these plans are in most cases less ambitious than the collective new 32.5% EU energy efficiency target adopted in 2018 as part of the Clean Energy Package. Despite covering the “energy efficiency first” dimension, the plans overlook the potential of primary energy savings with the uptake of supply side efficiency in the heating and power generation sector, particularly high-efficiency cogeneration although required by the Energy Efficiency Directive. Insufficient focus is also placed on investments and incentives including stable support schemes for energy efficiency. These are key to provide the clarity and predictability needed for businesses and investors to make proper investment decisions.
Energy efficiency is a prerequisite for decarbonising our economy, increasing renewable energy uptake, as well as addressing energy poverty and fostering competitiveness. As illustrated by the IEA report, a slowdown in energy efficiency progress means missing both its environmental economic benefits. Considering the difficulties to reach the energy efficiency target at EU level, bolder investment measures in energy efficient solutions should be a core priority for the EU Member States in their upcoming final NECPs. Failing to do so may put at risk Europe’s ability to meet its 2030 energy efficiency target and Paris climate goals.