Policy analysis for energy efficiency in the built environment in Spain

Energy efficiency is considered one of the most cost effective ways to enhance security of energy supply and reduce greenhouse gas emissions. According to Europe's Energy Efficiency Plan, the biggest energy savings potential in the EU lies in the built environment. However, the many barriers to energy efficiency have prevented the implementation of the existing potential so far. This paper evaluates the existing policy instruments aimed at energy efficiency in buildings in Spain as laid down in the 2nd National Energy Efficiency Action Plan (NEEAP). The results show that the current policy package is insufficient to yield the existing energy savings potential in this sector. As much of the savings potential can be found in existing buildings and realization of this potential very much relies on voluntary action, the renovation sector is in need of an appropriate financial framework that mobilizes sufficient public and private financial resources, and transparent and efficient mechanisms to ensure the return on investment and payments from those who benefit from the renovation. Such financial framework needs to be supported by a regulatory framework that is tuned to existing buildings and an organizational framework that effectively connects the different policy layers in Spain.     

The energy intensity in Lithuania during 1995–2009: A LMDI approach

The measurement, assessment, and effective mitigation of energy intensity compose a foremost objective of contemporary energy policy. Although the European Union (EU) Member States have been experiencing the convergence in energy efficiency indicators, Lithuania, acceded to the EU in 2004, still remains peculiar with relatively high energy intensity. Our study, therefore, is aimed at analyzing the energy intensity trends in Lithuanian economy as a whole as well as in separate economic sectors. The investigation covers the period of 1995–2009. The Logarithmic Mean Divisia Index was applied for decomposition analysis. Our analysis has shown that energy efficiency falls during economic downturn. In order to facilitate these challenges the Lithuanian Government as well as business should opt for increasing energy efficiency in the most problematic sectors of transport and services. In addition, the analysis of legal acts, namely National Energy Efficiency Programme for 2006–2010 and Energy Efficiency Action plan for 2010–2016, was taken into consideration. Some suggestions, thus, were offered for successful implementation of strategic goals outlined in the aforementioned strategic documents.     

Incentives for energy efficiency in the EU Emissions Trading Scheme

This paper explores the incentives for energy efficiency induced by the European Union Emissions Trading Scheme (EU ETS) for installations in the energy and industry sectors. Our analysis of the National Allocation Plans for 27 EU Member States for phase 2 of the EU ETS (2008–2012) suggests that the price and cost effects for improvements in carbon and energy efficiency in the energy and industry sectors will be stronger than in phase 1 (2005–2007), but only because the European Commission has substantially reduced the number of allowances to be allocated by the Member States. To the extent that companies from these sectors (notably power producers) pass through the extra costs for carbon, higher prices for allowances translate into stronger incentives for the demand-side energy efficiency. With the cuts in allocation to energy and industry sectors, these will be forced to greater reductions; thus, the non-ET sectors like household, tertiary, and transport will have to reduce less, which is more in line with the cost-efficient share of emission reductions. The findings also imply that domestic efficiency improvements in the energy and industry sectors may remain limited since companies can make substantial use of credits from the Kyoto Mechanisms. The analysis of the rules for existing installations, new projects, and closures suggests that incentives for energy efficiency are higher in phase 2 than in phase 1 because of the increased application of benchmarking to new and existing installations and because a lower share of allowances will be allocated for free. Nevertheless, there is still ample scope to further improve the EU ETS so that the full potential for energy efficiency can be realized.

Energy efficiency,security of supply and the environment in South Africa: Moving beyond the strategy documents

Energy efficiency is one of the most potent and cost effective ways of meeting the demands of sustainable development. It has in fact been referred to as the best energy resource. Way back in 2005 the South African Department of Minerals and Energy (DME) published its Energy Efficiency Strategy in support of some of the objectives enlisted in the 1998 White Paper on Energy Policy. The Strategy set a national target for energy efficiency improvement of 12% by 2015 against the baseline year 2000. The document further predicted that, with a business as usual model of energy usage, at the projected rate of national economic development, there would be a need to invest in new power generating capacity by around 2007. Despite the policy foresight and seemingly enthusiastic efforts, though, the dawn of 2008 saw the country gripped in an electric power crisis, with a capacity shortfall of over 10%. This paper looks at what could have gone wrong, examines energy efficiency policies and measures in other countries and how these lessons could be adopted to the South African context.     

Comparison of the evolution of energy intensity in Spain and in the EU15. Why is Spain different?

Energy intensity in Spain has increased since 1990, while the opposite has happened in the EU15. Decomposition analysis of primary energy intensity ratios has been used to identify which are the key sectors driving the Spanish evolution and those responsible for most of the differences with the EU15 energy intensity levels. It is also a useful tool to quantify which countries and economic sectors have had most influence in the EU15 evolution. The analysis shows that the Spanish economic structure is driving the divergence in energy intensity ratios with the EU15, mainly due to strong transport growth, but also because of the increase of activities linked to the construction boom, and the convergence to EU levels of household energy demand. The results can be used to pinpoint successful EU strategies for energy efficiency that could be used to improve the Spanish metric.     

The impact of international GHG trading regimes on penetration of new energy technologies and feasibility to implement EU Energy and Climate Package targets

The EU's new energy and environment policy - agreed by government leaders in their Council meeting in March 2007 - established a political agenda to tackle three core energy objectives: sustainability, economic competitiveness and security of supply. A triad of specific policies addresses these challenges: first, the 20/20/20 targets of the EU; then, the Second Strategic Energy Review of the European Commission; and finally, plans to liberalise energy markets. The European Union's ‘20/20/20′ targets for 2020: reduce greenhouse gas emissions by 20% comparing with 1990 level (to become a 30% reduction if other major global economies join), increase the share of renewables in the final energy consumption to 20% and to achieve 20% improvement in energy efficiency compared to the level in 2020 if existing trends were to continue.The aim of the paper is to analyse the feasibility of EU to implement 20/20/20 targets under the various international GHG trading regimes. GHG trading regimes were addressed by developing 10 energy scenarios until 2020 for EU by applying several energy modelling tools ranging from top down partial equilibrium to detailed technology based bottom up models.     

Medium-term energy outlook for Cyprus and its policy implications

This short paper presents results from an energy forecast model for the Republic of Cyprus. The model was used during years 2010–2011 to assist national authorities in their preparation of the National Renewable Energy Action Plan and the Energy Efficiency Action Plan of Cyprus in line with the requirements of European Union Directives. Major macroeconomic and price assumptions of the model are presented, and results from model application under different assumptions with regard to the evolution of energy efficiency are outlined and discussed. On the basis of these scenarios the paper discusses policy implications for Cyprus regarding the country's compliance with EU energy and climate legislation.     

Formulating a modern energy companies’ environment in the EU accession member states through a decision support methodology

One of the current energy policy's goals in the European Union (EU) is the exchange of knowledge and experience between the EU-15 member states and the new as well as the candidate countries in issues regarding the development of Renewable Energy Sources and the promotion of Energy Efficiency (EE). Nowadays, the liberalization of energy markets and the deterioration of the climate, in combination with the non-stop crude oil price increase, have had a decisive influence on the development of the above sectors. In addition, one of the most important elements for the renewable energy and EE development is the enhancement of energy producers by renewable energy and Energy Service Companies (ESCOs), respectively. These companies’ success is based on the formulation of a modern environment in each EU member state. However, the environment in the new and candidate member states is less mature than the environment in the EU-15 member states, as it is still in its development phase. In this context, the main aim of this paper is to present a “multi-dimensional” decision support methodology for the formulation of modern energy companies’ operational environment in the 13 new and candidate member states of the EU.     

Applying resource efficiency principles to the analysis of EU-27 bioenergy options by 2020 – Findings from a recent study for the European Environment Agency

The Renewable Energy Directive sets a target for the European Union (EU) to consume 20% of its final energy from renewable sources by 2020 and further targets are under discussion. EU renewable energy targets will lead to a substantial increase in the demand for bioenergy. As for other sectors, it is important, therefore, to apply the principles of the EU Resource efficiency roadmap to bioenergy production: producing more output with less material input and minimising adverse environmental impacts during the entire production life cycle. This paper uses that concept to analyse the most resource efficient ways for reaching the 2020 bioenergy targets (as set out in National Renewable Energy Action Plans).Scenario analysis with three different storylines is used to model environmental and land use implications plus total bioenergy potential and GHG reductions in 2020 from the agricultural, forest, and waste sectors. These storylines vary in environmental ambition level and economic and political assumptions and explore plausible bioenergy development paths. They show substantial variance in terms of environmental impact and the GHG efficiency between different bioenergy pathways.The modelling shows that under Storyline 1 bioenergy targets of the National Renewable Energy Action Plans would be achieved with CO₂ eq emissions of 44 kg GJ⁻¹, i.e. 62% less GHG emission than if the energy were generated using fossil fuels. In contrast, stricter environmental constraints in Storyline 3 lead to a substantially lower CO₂ eq burden of 25 kg GJ⁻¹, which represents an 80% reduction compared to fossil fuels.     

Polices for increasing energy efficiency: Thirty years of experience in OECD countries

Energy efficiency improvement was an important phenomenon in the global energy balance over the past 30 years. Without energy efficiency improvements, the OECD nations would have used approximately 49% more energy than was actually consumed as of 1998. This paper first reviews energy intensity trends for the major OECD nations since 1973, considering how much of the overall reduction in E/GDP was due to energy efficiency improvement and how much was due to structural change. The bulk of the paper examines the energy efficiency policies and programs adopted in Japan, United States, and Western Europe, commenting on their effectiveness and energy savings impacts where possible. The paper also reviews the energy efficiency policies and programs adopted in California. This experience shows that well-designed policies can result in substantial energy savings, as demonstrated in the United States where nine specific policies and programs reduced primary energy use in 2002 by approximately 11%. Substantial energy savings also occurred in Japan, some European countries, and in the electricity sector in California.     

Regional energy rebound effect: The impact of economy-wide and sector level energy efficiency improvement in Georgia,USA

Rebound effect is defined as the lost part of ceteris paribus energy savings from improvements on energy efficiency. In this paper, we investigate economy-wide energy rebound effects by developing a computable general equilibrium (CGE) model for Georgia, USA. The model adopts a highly disaggregated sector profile and highlights the substitution possibilities between different energy sources in the production structure. These two features allow us to better characterize the change in energy use in face of an efficiency shock, and to explore in detail how a sector-level shock propagates throughout the economic structure to generate aggregate impacts. We find that with economy-wide energy efficiency improvement on the production side, economy-wide rebound is moderate. Energy price levels fall very slightly, yet sectors respond to these changing prices quite differently in terms of local production and demand. Energy efficiency improvements in particular sectors (epicenters) induce quite different economy-wide impacts. In general, we expect large rebound if the epicenter sector is an energy production sector, a direct upstream/downstream sector of energy production sectors, a transportation sector or a sector with high production elasticity. Our analysis offers valuable insights for policy makers aiming to achieve energy conservation through increasing energy efficiency.     

State-level benefits of energy efficiency

This paper describes benefits attributable to state-level energy efficiency programs. Nationwide, state-level energy efficiency programs have targeted all sectors of the economy and have employed a wide range of methods to promote energy efficiency. Standard residential and industrial programs typically identify between 20% and 30% energy savings in homes and plants, respectively. Over a 20-year period of time, an average state that aggressively pursues even a limited array of energy efficiency programs can potentially reduce total state energy use by as much as 20%. Well-designed energy efficiency programs can be expected to help overcome numerous barriers to the market penetration of energy efficient technologies and accelerate the market penetration of the technologies. Energy efficiency programs are cost-effective; typical benefit–cost ratios exceed 3:1 and are much higher when non-energy and macroeconomic benefits are included. Indeed, energy efficiency and associated programs and investments can create significant numbers of new jobs and enhance state tax revenues. Several states have incorporated energy efficiency into their economic development programs. It should also be noted that increasing amounts of venture capital are being invested in the energy sector in general and in specific technologies like solar power in particular.     

The unexpected challenges of using energy intensity as a policy objective: Examining the debate over the APEC energy intensity goal

AimsEnergy intensity (energy demand per unit of economic output) is one of the most widely used indicators of energy efficiency in energy policy discussions. Yet its application in real-world policymaking can be surprisingly problematical. This paper aims to provide guidance to governments and organizations considering using energy intensity as a policy objective.ScopeIn 2007 the APEC community adopted, then in 2011 revised, an APEC region-wide energy intensity improvement goal. This paper presents a case study of that experience, focusing on three key ‘lessons learned’. These lessons are not original findings. However, none of them have received the recognition they deserve, and consequently, they came as a surprise to many of those involved in APEC's policy discussions.ConclusionsThe three lessons are as follows: (1) Energy intensity improvement is happening surprisingly quickly, but not quickly enough to meet the world's energy challenges. (2) It is difficult to find a definition of energy intensity that can make it suitable for use as an indicator of regional energy efficiency. (3) Whether the GDP's of individual economies are converted to common currency using market exchange rates or purchasing power parity (PPP) can dramatically change regional energy intensity improvement calculations.     

Green buildings for Egypt: a call for an integrated policy

As global warming is on the threshold of each country worldwide, Middle East and North African (MENA) region has already adopted energy efficiency (EE) policies on several consuming sectors. The present paper valuates the impact of temperature increase in the residential building sector of Egypt that is the most integrated example of the 7 out of the 20 MENA countries that have started their green efforts upon building environment. Furthermore, as it is based on a literature research upon socio-economic characteristics, existing building stock, existing legal and institutional framework, it elaborates a quantitative evaluation of Egypt's energy-saving potential, outlining basic constraints upon energy conservation, in order for Egypt to be able to handle the high energy needs due to its warm climate. Last but not least, the paper proposes a policy pathway for the implementation of green building codes and concludes with the best available technologies to promote EE in the Egyptian building sector.     

Voluntary agreements in the field of energy efficiency and emission reduction: Review and analysis of experiences in the European Union

A number of Member States of the EU have introduced voluntary agreements (VAs) that aim to deliver energy savings and emission reductions via increased energy efficiency in different end-use sectors, mainly targeting industry.     

Benchmarking the energy use of energy-intensive industries in industrialized and in developing countries

Improved energy efficiency is among the key measures for CO₂ emission abatement in the industry. Energy benchmark curves provide data measured at individual plants and they offer a basis to estimate the sectoral energy efficiency improvement potentials (IP) compared to a best practice technology (BPT) currently in operation worldwide. In this paper, we estimate the BPT energy use of 17 industry sectors based on such curves or energy indicators prepared at country-level. We compare BPT data with current energy use to estimate the IP. According to our analysis, BPT offers improvement potentials of 27 ± 8% worldwide. This is equivalent to 32.5 ± 9.6 EJ (exajoules) of final energy savings worldwide, of which three-quarters can be achieved in developing countries. Due to lack of benchmark curves and limited data availability for developing countries, our results include uncertainties. We used literature data at country-level and international energy statistics to fill data gaps and to develop energy indicators. Quality of these data should be improved and benchmark data needs to be collected for more sectors. By doing so, energy benchmarking could become a key tool to estimate energy saving potentials and energy indicators could serve as strong supplementary methodology.     

How much will the energy service directive contribute to the 20% EU energy savings goal?

The Energy Service Directive (ESD) of the European Union (EU) stipulates that member states realize 9% energy savings for the period 2008–2016. A harmonized calculation approach, consisting of a combination of top-down and bottom-up methods, will be developed to determine the savings of energy efficiency improvement measures. However, it is unclear which part of all realized energy savings is eligible in meeting the ESD target. One can argue that not all savings, especially the autonomous efficiency gains, should be accounted for, but only savings due to (new) policy. An analysis is made of the way the methods can be applied, how baseline choices define the savings and whether these represent policy-induced savings. It is shown that the given target could be met with total energy savings that equal 1.0% of ESD energy use per year, hardly more than realized at present. With other choices, the target is met with total savings of 1.6% per year. The savings found are made comparable with the 2.4% yearly savings derived from the 20% savings target for 2020 formulated by the EU. Given the large gap between ESD savings and the savings target, it is concluded that the methods and baselines used should be chosen such that the ESD target leads to realized savings after 2008 at the upper side of the margin.     

An empirical analysis of energy efficiency in China''s iron and steel sector

Using Malmquist Index Decomposition, this paper investigates energy efficiency of China's iron and steel sector during the period 1994–2003. Provincial panel data is employed, allowing various energy inputs and product outputs. The energy efficiency improvement is decomposed into two components: technical change (production frontier shifting effect) and technical efficiency change (catching up effect) over time. Our empirical results indicate that the energy efficiency in China's iron and steel sector increased by 60% between 1994 and 2003, which is mainly attributable to technical progress rather than technical efficiency improvement. The energy efficiency gaps among provincial iron and steel sectors during this period have widened. However, energy efficiency of iron and steel plants owned by the state has slowly improved in some regions, such as Shanghai, Liaoning, Beijing and Hubei. Nevertheless, technical efficiency in these four regions has decreased considerably. Energy efficiency in China's two largest private-own iron and steel bases (Heibei and Jiangsu) improved significantly.     

How much market do market-based instruments create? An analysis for the case of “white” certificates

Among the diverse economic instruments to foster energy efficiency (EE) and climate protection, tradable certificates have been investigated for renewable energy, and the EU directive on an emissions-trading scheme for CO₂ certificates has been approved in 2003. In contrast, tradable energy efficiency—or “white”—certificates have only lately been considered as a market-based tool to foster EE as compared with standards and labelling, for example. Theoretically, there is little doubt about the advantages. In practice, however, some fundamental problems arise. Critical issues are the design of an efficient artificial market for white certificates, its compatibility with the European emissions-trading system, the identification of a suitable target group for an EE obligation and the measurement of energy savings as compared with a reference use of energy. We use the theoretical framework of transaction cost economics to elaborate these issues. We conclude that transaction costs and investment specificity will restrict markets for white certificates in practice. Long-term contracts rather than spot trade will be the prevailing form of governance for EE investments.     

Greenhouse gas emission reduction perspectives in the Baltic States in frames of EU energy and climate policy

The goal of this paper is to estimate the perspectives of the Baltic States: Estonia, Latvia and Lithuania on meeting the new European Union climate commitments, i.e., to reduce greenhouse gas emissions by 20% to the year 2020 in comparison with 1990. This ambitious target could be reached based on other EU climate and energy package commitments: increase of the share of renewables and improvement of energy efficiency as tools for fulfilling the GHG emissions reduction target.The paper gives an overview on the current situation and future plans of the Baltic States in the field of energy efficiency, consumption of renewables and reduction of GHG emissions.