The role of energy efficiency in the framework of the EU energy and - PowerPoint PPT Presentation

The role of energy efficiency in the framework of the EU energy and climate strategy – A policy-based scenario analysis Presentation eceee Summer Study 2009 Stefan Lechtenböhmer La Colle sur Loup Stefan Thomas 2 June 2009 Christoph Zeiss

Overview  The triple Challenge  The climate leadership of the EU and the 30% reduction target  Could the EU deliver? – A scenario with a domestic 30% GHG emission reduction – Energy efficiency as a crucial strategy element  Policy needs for implementation of EE  Conclusion Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 1

Climate change, energy security and economics impose a triple challenge to the world The climate challenge becomes increasingly urgent  Only one or two decades left to reach the peak of GHG emissions (IPCC)  EU (ICs) must take the lead, this will not harm their economies  Emerging countries can follow if sustainable development is the aim The time of cheap oil and gas supply is coming to an end  Declining conventional reserves in the OECD  Increasing import dependencies in ICs, China, India and others  Fierce competition (speculation, resource conflicts) about limited resources  Increasing instability of prices and supply (oil supply crisis in 2013?) The window of economic opportunities  Worldwide: Strong mitigation actions today avoid much higher future costs for the word (Stern; IPCC 2007);  National (e.g. Germany): 40% GHG-reduction (2020) beneficial for the economy  Lead markets: “GreenTech” drives a new “Industrial Revolution”! Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 2

The Global CO 2 -Emission Budget To remain below +2°C By 2020:  – Max. +10% of global GHG emissions vs. 1990 (±0 vs. 2000; -10% vs. 2007) By 2050:  – -50% of global GHG emissions vs. 1990 (-55% vs. 2000; -60% vs. 1.000 Bln t CO 2 2007) by 2050 Industrialised countries:  (1/3 alread emitted – By 2020: -25% to -40% since 2008) – By 2050: -80% to -95% / 2t/Cap. Other countries:  – By 2020: Substancial (ca. 850 Mt) deviation from baseline (-15% to Sources: Hare 2007, -30%) Meinshausen 2009, Rahmstorf 2009 – By 2050: 2 t / Cap. Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 3

The reduction target for Kopenhagen Proposal by EU-Environment ministers (20 Oct. 2008) to „ keep the 2°C Target within reach “  Industrialised countries: – -25 to -40% by 2020 – Who should do more than the EU? Russia and Ukraine?  Developing and threshold countries – Significant deviation from baseline  The EU can not remain below ist own pledge – The EU might have to reduce its GHG emissions by probably even more than 30% when it stands up to its own position Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 4

Efficiency: Core solution for low GHG scenarios (WEO 2008) Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 5

..the same for the EU (30% domestic GHG emission reduction scenario WI/WWF 2008) Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 6

... or Germany (The Meseberg Package, 2007):  Meseberg Package: GHG mitigation by strategy Integrated energy and climate (Meseberg Package) – program (IEKP) combrehensive package of – measures to achieve the target  GHG mitigation target: 40% by 2020 – if the EU commits itself to 30% –  Sub-Targets: More than doubling of RES-share – Doubling of CHP-share to 25% – Doubling of energy efficiency to 3% – p.a. Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 7

Energy efficiency potentials are there & have net benefits (WI-Study for Germany on behalf of E.ON, 2006) Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 8

This holds true also on a global scale... This holds true also on a global scale... ... according to IPCC ... according to IPCC 5.3 – – 6.7 6.7 <$100/tCO 2eq 2.4 - 4.7 5.3 <$100/tCO 2.4 - 4.7 1.6 – – 2.5 2.5 2.5 – 2.5 – 5.5 5.5 1.6 2eq Notes: Emissions from electricity use are counted in the end-use sectors. Transport not split into regions because of international aviation fuel. Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 9

...or McKinsey Quelle: „The McKinsey Quarterly“ 2007-1 Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 10

Potentials for 30% GHG Emissions Reduction (EU27): Acceleration of Final Energy Efficiency vs. BAU vs. 2005 FE-Intensity Reduction: -BAU: -1.4%/year -P&M: -2.8%/year Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 11

Components of energy related CO 2 emission reduction Kaya Identities Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 12

Economic Benefits of the 30% P&M scenario (EU27): Reducing Import Dependency (comp.to BAU) 75% 64% Subsequently reduced costs of imported energy: 1.3% of GDP (at 100$/barrel) Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 13

 Policy needs for implementation of EE Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 14

Current policy for energy efficiency The pending 20% energy savings target  Doing more with less / Energy efficiency action plan (2006): – Proposed target: 20% energy savings vs. BAU by 2020  Climate change comittee (EP) (Florenz Report, Dec. 2008): – Binding target: 20% energy savings vs. BAU by 2020 – „net zero energy“ new buildings from 2015/20  Spring council (March 2009): – Update of Energy efficiency action plan in 2009 – Energy efficiency package to be concluded in 2009  We might get a binding target on energy efficiency soon Wuppertal Institute 17. Mai 2009 15

Potential for 30% GHG Emissions Reduction (EU27): Buildings – stand for a third of energy savings vs. BAU  Exchange of most heating systems by: District heating systems, Solar and biomass, Condensing boilers  Tighter building codes – For all buildings, with improved quality assurance/enforcement – With stepwise increasing standards, approaching Passive house level by 2020 – Step wise including existing buildings  Boosting of renovation rates – From currently below 1% to about 2.5% per year – 100% of renovations coupled with high quality energetic refurbishments  Comprehensive policy package needed – Standards --> EPBD with stricter requirements (however, most of building energy is consumed in NW-Europe with already high standards) – Financial support and other support and incentives (national subsidies, energy efficiency funds, project based machanisms/bundling of projects to attract external funding) Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 16

Potentials What would be needed for the 30% reduction scenario? Transport CHP Transport stands for 36% of energy CHP increases primary energy savings vs. BAU: efficiency:  Fuel economy of cars is decisive  Increasing of the CHP share in electricity generation: from 13 to 23 – 120gCO 2 /vkm mandatory from % (by 2020) 2012  Due to: – 100gCO 2 /vkm mandatory from 2018 – Increased electricity to steam ratio – That means quick tightening of current regulation – Expansion of district heating and industrial CHP  Equivalent improvements in trucks – Cutting of electricity demand  Plus: growth rate by 50% – Active demand management  50% of new CHP biomass/biogas – Modification of modal split fired Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 17

30% Domestic GHG Emission Reduction by 2020 (EU27): Conclusions I  The EU should do -30% domestically, in order to stay credible and a front runner in climate policy  The potentials to deliver on that are there – Numerous studies prove promising potentials for efficiency, renewables and CHP – Such a policy has significant co-benefits (preventing price shocks and securing energy supply) – But: Still a huge implementation gap - immediate action is needed because of long investment circles  Energy Efficiency – EU27- 20% savings target is compatible with the 30%-P&M scenario – Active supporting frame work to create energy services markets is lacking (e.g. energy efficiency funds; incentives for Contracting, DSM)  Renewable Energies – EU27 - 20% RES target is almost sufficient for the the 30%-P&M scenario – Expansion and investments are on a good track, but only for electricity – Without increased FE-efficiency (double rate p.a.) other sector specific targets for buildings, RES, CHP, transport etc. will hardly be achievable Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 18

Conclusion II: Demand side energy efficiency particularly important  19% demand side energy savings (vs. BAU) – Contribute by more than 40% to the -30% GHG target – Significantly ease the target of 20% renewables  The implementation has to be significantly accelerated – Transport:  Targets have been watered down  This has to be re-tightened, otherwise 30% domestic reductions seem to be hardly reachable – Buildings:  Rapid action needed on standards and particularly refurbishment rates  This requires particular action with regards to financial incentives – Appliances  Tigther standards have to be implemented faster  Standards and labels have to become dynamic Wuppertal Institute 2 June 2009 Lechtenböhmer, Thomas, Zeiss 19

It ʻ s in our hands to save energy Many thanks for your attention !