What Is The Energy Efficiency Directive For 2030?

The European Union has set ambitious climate and energy policy goals for 2030 as part of its commitment to reduce greenhouse gas emissions and transition to a low-carbon economy. These targets and policies are outlined in the EU’s 2030 climate and energy framework.

A key component of this broader framework is the Energy Efficiency Directive which was revised in 2018 to help the EU reach its 2030 goals. The revised directive sets a new target to increase energy efficiency across the EU by at least 32.5% by 2030 compared to a business-as-usual scenario.

The 2030 climate and energy framework aims to make Europe’s economy and energy system more competitive, secure and sustainable. It builds on the 2020 climate and energy package and is in line with the EU’s long-term goal to become climate neutral by 2050 under the European Green Deal.

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History and Background

The Energy Efficiency Directive was first introduced by the European Union in 2012 as part of the Europe 2020 strategy. Its goal was to contribute to achieving the EU’s energy efficiency target of 20% by 2020.

The directive established a common framework of legally binding measures to help remove barriers and overcome market failures that impede efficiency in energy supply and use across the EU. Some key provisions included mandatory energy efficiency obligations schemes, renovation requirements for public sector buildings, and promotion of energy audits and energy management systems.

In 2016, as part of the Clean Energy for All Europeans package, the European Commission proposed revisions to the directive to make the EU’s energy efficiency framework fit for 2030. This led to the revised Energy Efficiency Directive (EU) 2018/2002, which entered into force in December 2018.

The revised directive sets a headline energy efficiency target for the EU of at least 32.5% by 2030. It aims to leverage the digitalization of energy systems, strengthen consumer empowerment and rights, and drive the renovation of buildings. The directive also emphasizes the exemplary role of the public sector.

Overall, the Energy Efficiency Directive has evolved to provide a crucial legislative framework and targets to facilitate a cost-effective transition to a more efficient, sustainable, and secure energy system across the EU.

Key Provisions

The updated Energy Efficiency Directive for 2030 focuses on several key provisions to help the EU achieve its energy efficiency and climate goals. Some of the main components include:

Binding Energy Savings Target: The directive sets an ambitious binding target to reduce EU energy use by 32.5% by 2030 compared to business-as-usual projections (EU, 2022). This target will be achieved through both national contributions and EU-level measures.

Building Renovations: Member states must establish strategies for renovating their building stock to improve energy performance. The public sector is expected to lead the way by renovating at least 3% of government buildings each year (EU, 2022).

Public Procurement: Rules on public procurement are updated to ensure the public sector leads by example in buying energy efficient products, services and buildings (EU, 2022).

Energy Audits: Large companies must conduct mandatory energy audits at least every four years to identify efficiency opportunities (EU, 2022). SMEs are encouraged to undergo audits as well.

Metering and Billing: Consumers and businesses should have access to more frequent, clear and meaningful information on their energy consumption through individual metering and billing (EU, 2022).

Transport Sector: Member states should establish policies to improve efficiency and reduce energy consumption in the transport sector, including through vehicle taxation, low-emission mobility and development of infrastructure for alternative fuels (EU, 2022).

Energy Savings Target

The key provision of the 2030 energy efficiency directive is the 32.5% binding energy efficiency target for 2030. This target sets the goal of reducing EU final energy consumption by 32.5% by 2030, compared to the projected energy use for 2030 based on 2007 levels.

The 32.5% target was agreed upon after extensive negotiations between the European Commission, European Parliament, and EU member states. The Commission originally proposed a binding target of 30%, while the Parliament pushed for a more ambitious 35% target. The final 32.5% compromise was struck in 2018.

The binding nature of the 32.5% target means that it is legally obligatory for member states to enact policies and measures aimed at delivering this level of energy savings by 2030. Each member state must set its own national contributions that will collectively achieve the EU-level 32.5% target.

The 32.5% goal represents a scaling up of ambition from the previous 20% energy efficiency target for 2020. By setting a more aggressive target for 2030, the EU aims to maximize energy savings and reduce dependence on fossil fuel imports.

Building Renovations

The Energy Efficiency Directive aims to accelerate the renovation of existing buildings across the EU, as buildings account for 40% of energy consumption. The directive sets a target for Member States to renovate 3% of the total floor area of buildings owned and occupied by central government each year from 2014-2020. This was increased to an annual renovation rate of at least 3% for all public buildings in 2018.

The directive requires Member States to establish long-term national renovation strategies to support renovation of residential and commercial buildings, both public and private. The key focus is on policies and actions to stimulate cost-effective deep renovations that generate significant energy savings. Member States are expected to outline clear milestones and measures, as well as address issues like split incentives between owners and tenants or investors and users (Energy Performance of Buildings Directive).

The revised directive in 2018 goes further by requiring the development of national roadmaps with clear milestones and measures for the long-term renovation of buildings, with forward-looking perspectives beyond 2050. There are also new requirements on recharging points for electric vehicles and on rolling out digital systems for monitoring and managing energy use.

Public Procurement

The Energy Efficiency Directive includes requirements for central governments to purchase energy efficient products, services and buildings. Countries must ensure that central governments purchase only products, services and buildings with high energy-efficiency performance. There are some exceptions for defense and security purchases.

The directive sets a target for all procurement carried out by central governments to be energy efficient. By 2030, central governments should achieve an annual energy efficiency target equivalent to 1.7% of final energy consumption. Member states must also encourage public bodies like local and regional governments to follow the same targets and rules.

The EU developed Green Public Procurement (GPP) criteria to help governments purchase energy efficient products, services and buildings. The GPP website provides guidance and resources to implement green procurement.[1]

Energy Audits

One key provision of the energy efficiency directive focuses on mandatory energy audits for large companies. Under the directive, companies that are not small or medium-sized enterprises (SMEs), defined as having 250 or more employees or an annual turnover exceeding €50 million and an annual balance sheet exceeding €43 million, are required to conduct an energy audit by 5 December 2015 and at least once every four years thereafter.

These mandatory energy audits aim to help large companies identify cost-effective ways to reduce energy consumption and improve energy efficiency. Energy audits must be conducted in an independent and cost-effective manner by qualified experts following established quality criteria. The audits must identify and provide a detailed review of the energy consumption profile of buildings, industrial operations, and transport related to the company’s activities. They must also assess opportunities for cost-effective energy efficiency improvements and report on the audit results and proposed action plan for realizing energy savings.

The directive allows companies to implement recognized energy or environmental management systems such as EMAS or ISO 50001 as an alternative compliance option to the mandatory energy audits. However, SMEs are encouraged rather than obliged to undergo energy audits or implement energy management systems. Overall, mandatory energy audits for large corporations are a key component of the EU’s strategy to promote better energy performance.

Sources:
https://energy.ec.europa.eu/topics/energy-efficiency/energy-efficiency-targets-directive-and-rules/energy-efficiency-directive_en
https://www.iea.org/policies/1723-compulsory-energy-efficiency-audits-in-large-companies

Metering and Billing

The Energy Efficiency Directive (EED) aims to empower energy consumers with accurate information to help them manage their energy consumption and costs. Specifically, the EED requires reforms to energy metering and billing to provide consumers with more frequent and detailed updates on their energy usage.

The key provisions related to metering and billing include:

Installation of smart meters – By 2020, EU member states must ensure smart meters are installed in at least 80% of households.

Accurate billing based on actual consumption – Consumers must receive accurate bills based on actual consumption at least every 6 months.
Free access to meter data – Consumers should have access to their meter data to manage their energy use.
Information on bills – Bills must include clear information comparing current energy consumption with previous periods to show trends.

These reforms aim to give consumers the detailed information they need to understand their energy use, identify waste, and change behaviors to save energy and money. Smart meters and frequent billing also enable innovative time-of-use tariffs to incentivize shifting energy use to off-peak periods. Overall, improved metering and billing seeks to empower consumers to take control of their energy costs.

Sources:

[1] https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32019H1660&from=GA

[2] https://www.kamstrup.com/en-en/insights/eed

Transport Sector

The transport sector accounts for around 25% of EU greenhouse gas emissions, so improving energy efficiency in this sector is a key priority of the Energy Efficiency Directive (European Commission). The directive sets a number of policies and measures aimed at making transport more energy efficient across the EU.

For road vehicles specifically, the Clean Vehicles Directive aims to promote the uptake of low- and zero-emission vehicles, setting public procurement targets for clean vehicles in public fleets (European Commission – Transport). The directive also requires member states to build recharging and refueling stations for alternative fuels.

The EU promotes sustainable mobility in urban areas through initiatives like the Sustainable Urban Mobility Plans, which provide a strategic framework for improving accessibility and quality of life. The EU also co-funds transport infrastructure projects that promote energy efficiency.

Additionally, the directive pushes for improvements in supply chain efficiency, multi-modal transport, and better traffic management to reduce energy use. The EU aims to shift more freight transport to low-carbon modes like rail or waterborne transport. Overall, policies target making the entire transport system in Europe more energy efficient.

Criticisms and Challenges

The 2030 energy efficiency target has faced criticism for not being ambitious enough. While it aims for a 32.5% reduction in energy consumption from 2007 levels, some argue this does not go far enough to meet the EU’s climate goals under the Paris Agreement. There are concerns the target lacks urgency and allows member states too much flexibility.

Monitoring compliance and enforcement of the directive has also proven challenging. The 2030 targets are not legally binding on member states. Some countries have been slow to transpose directives into national law and establish effective policy frameworks. Weak oversight makes it difficult to hold states accountable.

Further, the directive relies heavily on self-reporting by member states. There are inconsistencies in how energy savings are measured and verified across countries. Independent auditing and transparency in reporting have been flagged as issues.

Critics also argue the directive does not do enough to address energy poverty. While it aims to empower consumers through better metering and billing, the measures are not robust. Affordability of energy for low-income households remains a barrier.

Finally, some say the directive lacks sufficient focus on transport, which accounts for over 30% of EU energy consumption. The targets and policies for decarbonizing transport are perceived as vague compared to other sectors.