EU Energy Efficiency Directive reaches new stage

European Commission, the European Parliament, and the Council have made a provisional agreement to reform and strengthen the EU Energy Efficiency Directive, making a further step in the completion of the ‘Fit for 55′ package to deliver the European Green Deal and the REPowerEU plan.

According to European Commission, for the first time, the energy efficiency first principle is given legal strength with a clear requirement for EU countries to take energy efficiency into consideration in policy, planning, and major investment decisions in the energy sector and beyond.

The Commission said the agreement establishes an EU energy efficiency target of 11.7% for 2030, exceeding the Commission’s original ‘Fit for 55′ proposal, and requires the EU Member States to collectively ensure an additional reduction of final and primary energy consumption, compared with energy consumption forecasts made in 2020.

Under the provisional deal, the annual energy savings obligation nearly doubles to ensure continual progress. EU countries will be required to achieve new savings each year of 1.49% of final energy consumption on average, and will gradually have to reach 1.9% by the end of 2030.

The revised rules also give a greater responsibility to the public sector to increase energy efficiency, European Commission informed.

Companies will also be encouraged to be more energy-efficient under the revised Directive. Energy management systems will become a default obligation for large energy consumers and all enterprises, including SMEs that exceed 85 TJ of annual energy consumption, will have to implement an energy management system. For the first time, a reporting scheme for the energy performance of large data centres is also introduced, the Commission said.

The Commission further noted that, under the agreed rules, EU countries will also have to promote local heating and cooling plans in large municipalities having populations above 45,000. Also, with the revised definition of efficient district heating and cooling, minimum requirements will be gradually changed to ensure a fully decarbonised district heating and cooling supply by 2050.

Under the new provisions, EU countries will be required to promote innovative financing scheme and green lending products for energy efficiency, by ensuring their wide and non-discriminatory offer by financial institutions, and they will have to report on the volume of energy efficiency investments.

The agreement also includes the first-ever EU definition of energy poverty, the Commission noted. Member states will now have to implement energy efficiency improvement measures as a priority among people affected by energy poverty, vulnerable customers, low-income households, people affected by energy poverty, and, where applicable, people living in social housing.

European Commission stated that the provisional agreement now requires formal adoption by the European Parliament and the Council, and once this process is completed, the new legislation will be published in the Official Journal of the Union and enter into force.

The European Green Deal is the EU’s long-term growth strategy to make Europe climate-neutral by 2050, and the REPowerEU plan is the EU’s strategy to get rid of Russian fossil fuel imports as soon as possible.

Frans Timmermans, Executive Vice-President for the European Green Deal, said: “Saving energy is a key step to saving the planet. In recent months, Europeans have shown that they are ready and able to face this challenge, and our industry has proven that it can optimise its energy use and production processes. We now need energy efficiency to become an even more systemic part of our society, and this revised directive helps us to do that.”

Kadri Simson, Commissioner for Energy, added: “Energy efficiency is key for achieving the full decarbonisation of the EU’s economy and independence from Russian fossil fuels. A stronger EU framework on energy efficiency will help us stay the course to reach our 2030 energy and climate goals. It can also be an important driver for competitiveness and strengthen the security of supply. The new provisions on consumer empowerment and energy poverty will ensure that our clean energy transition is accessible to all, including the most vulnerable.”