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Securing Energy Efficiency to Secure the Energy Union

Yamina Saheb Heinz Ossenbrink

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26th August 2015

Energy affordability Energy security Climate change

Does energy efficiency reduce the size of the energy trilemma?

Fossil fuels accounted for 72% of the EU primary energy mix in 2013, six percentage points less than in 1990

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Fossil fuels

Source: EUROSTAT

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013 Crude oil Solid Fuels Natural gas Nuclear RE Others

EU GHG emissions decreased by 21% since 1990 but 79% of total GHG emissions were energy related in 2013

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26th August 2015 Source: EUROSTAT

EU 2020 Climate and Energy targets Renewable Energy Directive Energy Efficiency Directive

Transport’s GHG emissions increased over the period 1990-2013

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26th August 2015 Source: EUROSTAT

Domestic production of fossil fuels decreased by 16% while imports increased by 31% between 1990-2013

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26th August 2015 Source: EUROSTAT

• 100%
• 80%
• 60%
• 40%
• 20%

0% 20% 40% 60% 80% Belgium Bulgaria Czech Republic Denmark Germany Estonia Ireland Greece Spain France Croatia Italy Cyprus Latvia Lithuania Luxembourg Hungary Malta Netherlands Austria Poland Portugal Romania Slovenia Slovakia Finland Sweden United Kingdom

Domestic Solid fuels production Domestic Natural Gas production Domestic Crude Oil production Imports Crude Oil Imports Natural Gas Imports Solid Fuels

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Fossil fuel import bills exacerbate the trade deficits of most MSs and worsen their contribution to climate change

Source: EUROSTAT *Gross Inland Consumption *

EU decarbonisation scenarios and the energy trilemma

• EE27: Current energy saving target set by the European Council for

2030

• EE 30: the possible energy saving target to consider when the 2030

climate and energy policy framework is reviewed in 2020

• EE40: Energy saving target as called by the European Parliament for

2030

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Energy saving: First fuel of the EU by 2030

Source: PRIMES 2014

EE40, the sum of energy saving and renewables

• vertake the

sum of imported fossil fuels

26th August 2015

2015: Vintage year for Energy Efficiency

''It is necessary to fundamentally rethink energy efficiency and treat it as an energy source in its own right, representing the value of energy saved. As part of the market design review, the Commission will ensure that energy efficiency and demand side response can compete on equal terms with generation capacity.''

Source: A Framework Strategy for a Resilient Energy Union with a Forward-Looking Climate Change Policy Energy Union Package, COM(2015) 80 final

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Energy dependency may reach 70% if saving potential is left untapped

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26th August 2015 Source: PRIMES 2014

0% 10% 20% 30% 40% 50% 60% 70% 80% EE27 EE30 EE40 Mitigated import dependency due to decarbonisation scenarios Fossil fuels import dependency ratio if decarbonisation scenarios are implemented

The transport sector is projected to have the highest share of the EU final energy consumption

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0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013 EE27 EE30 EE40 Transport Residential Non-residential Industry

Source: PRIMES 2014 for EE scenarios Eurostat for 2013

Renewables will be the first fuel

• f power generation by 2030

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0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013 EE27 EE30 EE40 Renewables Nuclear Solid fuels Gas Oil

Source: PRIMES 2014 for EE scenarios Eurostat for 2013

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EE 27 and EE 30 EE 40 IEA 2DS

GHG emissions reduction is 6% higher in the EE 40 compared to EE27 and EE30 EE 40 is in the same order of magnitude than the IEA 2DS estimates for GHG emissions reduction for Europe by 2030

Source: PRIMES 2014

2300 2600 2900 3200 3500 3800 4100 4400 1990 2000 2010 2020 2030 Million of tonnes of CO2 equivalent (MtCO2eq.)

The building sector is projected to be the least emitting sector by 2030

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26th August 2015 Source: PRIMES 2014

An ambitious EE target would boost job creations

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26th August 2015 Changes in number of persons employed compared to the reference scenario

• 2,00
• 1,00

0,00 1,00 2,00 3,00 4,00 Agriculture Extraction industries Basic manufacturing Engineering and transport equipment Utilities Construction Transport Market services Public services (non market services)

GEM-E3

EE40 EE30 EE27

• 10,00
• 5,00

0,00 5,00 10,00 15,00 20,00 25,00 Agriculture Extraction industries Basic manufacturing Engineering and transport equipment Utilities Construction Transport Market services Public services (non market services)

E3ME

EE40 EE30 EE27

Source: PRIMES 2014

A guarantee fund is needed to leverage private finance and create a market for EE services

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A long-term investment framework at the ambition level of the EU challenges is needed for…

• …de-risking energy efficiency investments by

providing a guarantee;

• …reshaping institutions and skills;
• …monitoring, evaluation and enforcement of EE

policies.

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Energy affordability Energy security Climate change

Setting EE target should be based on costs/benefits analysis to reduce the size of the energy trilemma

Thank you for your attention

To download the report:

http://publications.jrc.ec.europa.eu/repository/bitstream/JRC97451/2015-12- 09%20securing%20energy%20efficient%20to%20secure%20the%20energy%20%2 0union%20online.pdf