What is the impact of the calculation options MS can invoke to address national circumstances?

The target is fixed at 0.8% of the annual final energy consumption – regardless of the options used.

Before the 2018 revision, the EED[1] was clear in the impact of the exemptions[2] on the overall target: for the period 2014-2020 the energy savings target was 1.5% with exemptions resulting in a reduction of this target by a maximum of 25%. The extent to which Member States made use of these options, depended on the level of ambition of each Member State to promote energy efficiency. Almost all Member States used the maximum exemption for the previous reporting period (2014-2020), meaning that in reality the EU average target was not 1.5%, as anticipated by the EED, but 0.96%[3]. The headline target for 2020 will not be achieved with the policy instruments as presented in the NEEAPs. There is an energy efficiency gap of 3.3% between Member States’ current policy instruments as presented in the NEEAPs and the EU’s energy efficiency headline target for 2020, according to the latest progress report for EU climate and energy targets by the EEA.[4]

In the amending Directive[5], the impact of the exclusions and exemptions is unclear. As a result of the negotiations, the final text is ambiguous and contradictory, and open to interpretations.

Making use of the exclusion of energy used in transport and/or any other options set out in Art. 7 (4) would again result in a lower national end-use energy savings target under Art. 7 and would reduce the need to implement new energy saving measures. On the latter, indeed, the options set out in paragraph 4 allow for additional measures that can be counted towards the amount of required energy savings, e.g. energy savings in energy transmission and distribution as well as actions newly implemented since 31 December 2008 that continue to have impact beyond 2020. The options chosen under paragraph 4, however, shall not lead to a reduction of more than 35%[6] of the amount of energy savings calculated. If this percentage is fully utilized the target would be lowered to 0.52%.

On the other hand, in the amending Directive, one important subparagraph was added[7]:

“Regardless of whether Member States exclude, in whole or in part, energy used in transport from their calculation baseline or make use of any of the options listed in paragraph 4, they shall ensure that the calculated net amount of new savings to be achieved in final energy consumption during the obligation period from 1 January 2021 to 31 December 2030 is not lower than the amount resulting from applying the annual savings rate referred to in point (b) of the first subparagraph of paragraph 1.”

In other words, this paragraph fixes the target at 0.8% of the annual final energy consumption and seems to make the list of exemptions, as well as their 35% limit, meaningless[8].

The target is on end-use savings. Savings in energy transformation, distribution and transmission have no impact on the target.

Although the target of Art. 7 is an end-use energy savings target, Member States may count[9] towards the amount of required energy savings the energy savings achieved in the energy transformation, distribution and transmission sectors, including efficient district heating & cooling infrastructure and high-efficiency cogeneration (Art. 7 (4c)). Those measures increase the energy efficiency and reduce primary energy consumption but have no impact on end-use energy savings. Member States have to inform the European Commission on policy measures taken in this field and their respective impact.

However, as explained in the previous paragraph, these exemptions cannot reduce the national end-use energy savings target, for which their reporting is nothing more than an additional effort and will probably be ignored by the Member States. Only measures which reduce final energy savings can be accounted for the achievement of the target.

How does fuel switch (e.g. electrification) act on the targets?

On the one hand, fuel switch can act on the achievement of the target by producing end-use energy savings through a switch from e.g. an oil to a gas boiler. On the other hand, policy measures promoting the installation of new small-scale renewable energy technologies on or in buildings like heat pumps may be eligible as 30% of the verifiable amount of energy generated from these installations for own use can be excluded from the calculation of the amount of energy savings that determine the target.

 

[1] Directive 2012/27/EU on energy efficiency

[2] Art. 7(2) and Art. 7(3) in the 2012/27/EU Directive

[4] EEA (2018). Trends and projections in Europe 2018 - Tracking progress towards Europe's climate and energy targets. Online available at: https://www.eea.europa.eu/publications/trends-and-projections-in-europe-2018-climate-and-energy

[5] Directive (EU)2018/2002 amending Directive 2012/27/EU on energy efficiency

[6] Art. 7 (5b)

[7] Art. 7 (5) last subparagraph

[8] In legal terms: Art. 7 (5) says that exemptions of Art. 7 (2) and options of Art. 7 (4) can’t reduce the national end-use energy savings target of Art. 7 (1 b)