The ups and downs of EU energy efficiency policy

Power Games

How could anyone not wish to cut their energy bill? If like us you’re struggling on a measly NGO salary you would jump at the chance of lower bills. So would everybody with a grain of common sense. It means more money for – for what actually? We asked around. If your energy bill was cut by €100 a month, what would you do with the money? Some said they would save it (that was the NGOs); others wanted to spend it in a fancy restaurant. Others (the expats) would hop on a high speed train and go see their folks. Another – our favourite – plumped for buying a dog. Not just any dog you understand, but a car-chasing-death-defying border collie.

The point is that saving on bills is a good thing for consumers, and for businesses too. It’s an absolute no brainer that if you’re running a business then energy saving solutions are bound to be welcome – especially in today’s tough times. According to the European Commission, lopping 20% of the EU’s energy use by 2020 would save €200 billion every year by 2020. That breaks down to €1000 per year per household. Lots of good meals out.

But here’s the problem. However much it pays to use less energy, it certainly doesn’t suit the companies who sell the stuff. They have traditionally lobbied hard to block the mandatory energy savings target that experts say is needed to drive down energy use and consumer costs. And they have governments tied up in knots. The UK, for instance, is in the process of allowing power companies to push through a punishing 20% price increase that risks pushing millions into fuel poverty.

So who do you think wrote this statement? “Make the 20% EU efficiency target (by 2020) binding and break it down to national targets. Make it coherent to the policies related to emissions reduction and expansion of renewable energy”.

It wasn’t penned by the European Commission. Officials there recommend binding targets in internal analyses but chicken out in public. Believe it or not, the authors were the CEOs from energy giants Vattenfall and EnBW, as well as a number of other big industry bosses (you can see the full statement here; a 30% reduction in CO2 emissions is also recommended).

Energy companies breaking ranks? No need to say this is a political game changer. And yet… the statement makes good business sense: Europe’s environmental and resource challenges are such that Vattenfall, EnBW and their brethren cannot stick to selling kilowatts and gas. They need to diversify. The car industry for instance makes more money servicing than selling vehicles. Energy companies must make the same switch, by offering energy management services and getting involved in buildings renovation. Some are doing so already, and this suits us consumers.

Still to be seen, however, is what Messrs Tuomo Hatakka and Hans-Peter Villis – the CEOs concerned – are prepared to do in support of their statement for a binding efficiency target. Any chance of a lobby trip to Brussels this autumn?

By Brook Riley (Friends of the Earth Europe) and Erica Hope (Climate Action Network Europe)

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