The Fit for 55 package has the potential to deliver on the EU’s energy efficiency targets while the economic energy savings potentials for 2030 are increasing, according to a new study by Stefan Scheuer Consulting and Fraunhofer ISI.
The proposed recast of the Energy Efficiency Directive increases the EU target ambition, makes the EU level target binding, and introduces potentially powerful target governance tools.
It includes a formula to allocate the EU’s 2030 energy efficiency targets among Member States. A target allocation is new to energy efficiency but has been used with success for renewable energy and climate targets. But Member States would be allowed to deviate from the results of energy efficiency formula when determining national energy efficiency targets. The EED recast proposal includes a common correction factor, which could be used at the end to adjust national targets and ensure no gap is left to the EU target. But the Commission has not set out when and how it intends to use this tool.
The proposed EU 2030 energy efficiency-target levels of reducing energy demand by 9% compared to business as usual is an increase from the current 32.5% target to 36% for final energy demand and 39% for primary energy demand. Latest assessments show that economic energy savings potentials have been growing and if tapped would reduce final and primary energy demand by 17% and 18% respectively compared to business as usual.
The package includes important new elements which boost the delivery of energy efficiency targets. Carbon pricing for buildings and transport if coupled with requirements to use the new revenues, through the new Social Climate Fund to give vulnerable parts of society access to energy efficiency improvements in order to cut their energy bills.
The study includes the results of a test run of the new formula to allocate the target among Member States (see table).
This report is part of the project ‘Stronger EED Target Governance’ by Stefan Scheuer Consulting and Fraunhofer ISI, financed by the European Climate Foundation. It assesses the Fit for 55 package published by the Commission on 14th July 2021 and provides high-level recommendations for strengthening the target ambition and governance and for increasing the synergies with other pieces of the package.
This analysis builds on the findings of the first phase of our project, which started in March 2021. The findings are presented in Annex 1 (EED target governance options) and 2 (Energy Savings potentials) to this report. In the first phase, we:
– assessed the different governance approaches in EU climate and energy policies;
– developed an energy efficiency target benchmarking and allocation approach; and
– updated the EU’s and national economic energy savings potentials.
Wolfgang Eichhammer, Matthias REUTER, Stefan SCHEUER: Will the Fit for 55 package deliver on energy efficiency targets? A high-level assessment, October 2021