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Further progress in energy efficiency essential to reach carbon-neutrality

Primary energy consumption in the European Union declined by 0.7 per cent in 2018. A positive development, but a considerable acceleration in this reduction is needed if the 2020 target for energy efficiency is to be achieved.

Energy efficiency is a priority of the Green Deal. Given that 75 per cent of the greenhouse gases (GHG) emitted in the EU derives from the supply and use of energy, further progress in energy efficiency is essential to deliver on the commitments towards carbon neutrality and more ambitious climate objectives in the coming decade.

The European Commission’s annual progress report on energy efficiency confirmed that under normal circumstances (for example, without COVID-19), it is unlikely that the EU would have met its 2020 target. Therefore, this will remain an issue, when energy demand recovers after the COVID-19 crisis, with a view on achieving the 2030 energy efficiency targets.

The report refers to the delivery gap between the 32.5 per cent energy efficiency target for 2030 and the cumulative ambition of Member States outlined in their respective National Energy and Climate Plans (NECPs).

In particular, higher energy consumption was mainly observed in the transport (+1.3 per cent year-over-year increase compared to 2017) and industry sectors (+0.6 per cent). By contrast, energy consumption declined in the residential sector (-1.6 per cent) and in the services sector (-1.4 per cent).

Until 2018, twelve Member States managed to reduce or keep the final energy consumption level below their hypothetical linear trajectory for reaching their indicative targets by 2020, which included countries from the Central and Eastern European region (the Czech Republic, Greece, Croatia, Latvia, Romania and Slovenia). The same countries (plus Estonia, Lithuania and Slovakia) in 2018 were below their hypothetical linear trajectories. 

Specifically, compared to 2017, the sharpest increases in primary energy consumption were recorded in Estonia (+9.4 per cent) and Latvia (+5.1 per cent), while the sharpest drops were observed in Greece (-3.0 per cent).

Several Member States risk to not meet their national energy savings obligation by December 2020. It appears very unlikely (< 75 per cent likelihood) that countries like Bulgaria, Croatia, Lithuania and Romania will meet their national obligation. On the other hand, it is very likely (> 105 per cent likelihood) that Latvia, Poland and Slovakia will achieve more energy savings than required by 31 December 2020.

In order to help Member States reach their targets, the Commission plans to bring forward a new strategy for smart and sustainable transport later this year. There will also be other specific measures, such as the review of the Energy Taxation Directive, which will look closely at the role of taxation in the transport sector, as well as the current exemptions for aviation and maritime activities. Moreover, the use of electric vehicles needs to be further promoted and the policy to transfer passenger and freight to rail is to be continued and further enhanced, taking into account the superior energy-efficiency of rail transport.

The Commission will also continue focusing on the enforcement of EU legislation. On buildings, the upcoming Renovation wave initiative aims at boosting renovations and contributing to the recovery from the economic impact of the COVID-19 in line with the principle of just transition. Moreover, the review of the cost-optimal minimum energy performance requirements for new and existing buildings undergoing major renovations and the implementation of the nearly zero-energy building standards are expected to improve the energy performance of the building stock in the short term.

Apart from legislative efforts the Commission will work on mobilisation of the funding instruments at its disposal to deploy digital solutions and apply smart digitalisation (AI, automation, Big Data, Internet of Things) to help speed up the improvement process, where benefits are demonstrated and drive energy efficiency to the next level.

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