1. Dr. Stefan Thomas Felix Suerkemper Wuppertal Institute for Climate, Environment and Energy, Germany Implementation of the EED throughout the EU Energy Cities Romania Annual Conference Brasov, 22-24 April 2015

2. pageWuppertal Institute Status of NEEAP presentation to the European Commission by April 2015 National Energy Efficiency Action Plans (NEEAPs) were due in June 2014! As of 21 April:  26 NEEAPs presented in national language (all, but HU and Sl)  24 NEEAPs presented in English (all, but GR, HU, RO, Sl)  Romania: not presented yet in English! And only very recently in national language 23 April 20152 DR. STEFAN THOMAS

3. pageWuppertal Institute 23 April 2015 Energy Efficiency Policy: Harness the multiple benefits Recent publication by the IEA (2014): Capturing the Multiple Benefits of Energy Efficiency 3 Dr. Stefan Thomas

4. pageWuppertal Institute 23 April 2015 Energy Efficiency Policy: Harness the multiple benefits – some examples  Findings by the IEA (2014) for large-scale energy efficiency programmes:  GDP: growth rate + 0.25 to 1.1% per year  Employment: 8 to 27 job years per EUR 1 million invested; Romania’s Art. 4 strategy: up to 40,000 jobs from building renovation  Public budgets: EE in buildings in the EU could bring revenues and savings of EUR 67 to 128 billion to public budgets  Health and well-being impacts: may quadruple economic savings compared to energy cost savings alone  Productivity improvements: may by worth 2.5 times the energy cost savings alone  Energy poverty alleviation, Etc.  Wuppertal Institute 2014: Thailand could limit the share of energy import costs in GDP to 20 % through energy efficiency (baseline projection: almost 30%) 4 Dr. Stefan Thomas

5. pageWuppertal Institute23 April 2015 Multiple benefits of energy efficiency: Efficiency is cost-effective using life-cycle cost calculations Potential costs and benefits (present values) for enterprises and consumers per year of implementation of an illustrative portfolio of energy efficiency programmes in Germany (would achieve Art. 7 EED targets) Source: Wuppertal Institute 2013 Dr. Stefan Thomas 5

6. pageWuppertal Institute The role of NEEAPs Burden or Strategic Roadmap for harnessing the benefits of EE? Good practice for content of a NEEAP (1):  Addressing energy efficiency targets (Art. 3, 4, 7) and clear structuring according to EED provisions  Clear and comprehensive description of measures (incl. target groups, timeframe and operating mode) and changes compared to previous NEEAPs  Clear distinction between energy efficiency measures and others (e.g. policies to promote PV installation)  Include action by regional and local governments and support for these  Description of measures taken to promote energy service markets 23 April 20156 DR. STEFAN THOMAS

7. pageWuppertal Institute The role of NEEAPs Burden or Strategic Roadmap for harnessing the benefits of EE? Good practice for content of a NEEAP (2):  Quantification:  Savings achieved with existing EE policies  Baseline forecast for 2020 with existing EE policies and gap to targets  Presentation of new EE policies planned and savings for each policy estimated ex ante  prove they will be closing the gap (Basis: assessment of remaining potentials and gaps in sectoral policy packages)  Good Practice NEEAPs: e.g. UK, Germany, Poland 23 April 2015 DR. STEFAN THOMAS 7

8. pageWuppertal Institute The NEEAP cycle: Interplay of targets, analysis, policy design, implementation, monitoring, and evaluation 23 April 2015 DR. STEFAN THOMAS 8 Potential (GWh or CO 2eq /year), technically, economically Evaluation of policies and services Implementation and monitoring Revision of policy packages and target Ex ante analysis: implementation costs and achievable potential Definition of contributions to be made by sectors Design of Policy Packages per technology and sector Definition of quantitative target Required Savings (climate protection, energy security) Required Savings (climate protection, energy security)

9. pageWuppertal Institute Good practice in NEEAPs How EU Member States intend to implement Art. 7 (I) 23 April 20159 DR. STEFAN THOMAS Source: Coalition of Energy Savings 2015

10. pageWuppertal Institute Good practice in NEEAPs Member States compliance with EED Article 4 requirements 23 April 201510 DR. STEFAN THOMAS Source: BPIE 2014

11. pageWuppertal Institute Good practice in implementation Evolution of Denmark‘s savings targets for energy companies 23 April 201511 DR. STEFAN THOMAS 2,4 % per year

12. pageWuppertal Institute 23 April 2015 Example for a recommended sector-specific policy package: Buildings 12 Dr. Stefan Thomas Governance framework for energy efficiency Specific policies and measures for energy efficiency in new buildings Energy efficiency targets & planning Energy efficiency infrastructure & funding Eliminating distortions Regulation Information Incentives & financing Capacity building & networking Promotion of energy services RD &D and BAT promotion POLICY PACKAGE for ENERGY EFFICIENCY in BUILDINGS Source: Wuppertal Institute, www.bigee.net

13. pageWuppertal Institute  Energy efficiency has multiple benefits. It usually is a win-win-win option for all aspects of sustainability  We need much more evaluation and communication of these multiple benefits – to citizens, companies, and politicians!  Energy efficiency will still only to a part happen by itself - because of the manifold and strong market barriers  Governance and policy packages for energy efficiency are needed to tap the full potential and develop energy efficiency markets  Evaluation shows they can achieve around 2% per year of additional energy savings – we need more policy evaluation too Energy Efficiency Conclusions (1) 23 April 2015 13 Dr. Stefan Thomas

14. pageWuppertal Institute How local authorities could be more strongly involved in NEEAP implementation  A part of the specialised fund for investments could be set aside for local and regional governments to invest in their building stock (offices, schools, social housing, hospitals and other types of public buildings)  Local authorities can play an important role in developing projects among their citizens and enterprises, in cooperation with e.g. banks and energy (service) companies  => A special programme in the fund to support local authorities to hire energy efficiency (and RES) development managers,  (net)working within their cities and villages with providers of energy audits and installation of energy-efficient technologies etc.,  with citizens and enterprises interested in investments, communicating the fund's programmes,  supporting investors in applications,  taking care of professional training, etc. Energy Efficiency Conclusions (2) 23 April 2015 14 Dr. Stefan Thomas

15. Thank you for your attention! stefan.thomas@wupperinst.org felix.suerkemper@wupperinst.org

16. pageWuppertal Institute Good practice in NEEAPs How EU Member States intend to implement Art. 7 (II) 23 April 201516 DR. STEFAN THOMAS Source: ENSPOL 2015

17. pageWuppertal Institute23 April 2015 Why do we need governance for energy efficiency? To overcome the plethora of barriers Source: Wuppertal Institute Dr. Stefan Thomas 17  Energy efficiency = many small to medium technical improvements  lack of oversight (where to start?),  lack of information (both consumers and technology providers!),  sometimes small financial gains from an improvement  => lack of priority  sometimes lack of funds  split incentives between investors and users or between technology/building providers and buyers  => make energy efficiency easy, attractive, and eventually the default  => policy packages with more information, practical guidance, regulation, and financing support needed („the sticks, the carrots, and the tambourines“)

18. pageWuppertal Institute 23 April 2015 How instruments in the sector-specific package interact: Renovation of existing buildings 18 Dr. Stefan Thomas Source: Wuppertal Institute, www.bigee.net

19. pageWuppertal Institute 23 April 2015 Methodology for developing sector-specific policy packages Step 1 Analysis of actor-specific barriers and incentives Step 2 Developing implementation strategies to address the barriers and incentives Step 3 From implementation strategies to policy packages Step 4 Validate the resulting ‚recommended policy package‘ through empirical evidence of which instruments advanced countries have packaged together Actor-oriented theoretical analysisThe empirical proof PLUS: The multi-criteria assessment scheme to evaluate single policies: are they ‘good practice’? 19 Dr. Stefan Thomas Source: Wuppertal Institute 2012

20. pageWuppertal Institute 23 April 2015 General Actor Constellation New Buildings 20 Dr. Stefan Thomas Source: Wuppertal Institute, www.bigee.net

21. pageWuppertal Institute 23 April 2015 How instruments in the sector-specific package interact: New buildings 21 Dr. Stefan Thomas Source: Wuppertal Institute, www.bigee.net

22. pageWuppertal Institute 23 April 2015 Step 4: Validate the resulting recommended package through empirical evidence As the most advanced countries show, the policy package that we derived from our actor-centred analysis comes close to what countries have introduced to approach very high levels of energy efficiency PolicyCaliforniaChinaDenmarkGermanyTunisia Targetsxxxx Energy Agency(x) xxx Funds or DSMx(x)x x MEPSxxxxx Labels(x) xx Advice/auditsxxxxx Grantsx(x)x Soft loans/PAYSxxx Trainingxxxxx 22 Dr. Stefan Thomas