The EU’s Energy Efficiency Directive (EED) was adopted last week by the EU Council, a package of mandatory measures the EU claims could help cut energy consumption by 20% and save €50 billion a year.

It is hoped the directive, approved by all Council members except Finland, Spain and Portugal, will help the EU hit its 2020 20% energy efficiency target. The seeds of the EED were sown at the March 2007 EU summit, when Member States agreed a 20% energy efficiency target by 2020, together with a 20% renewable energy target and a 20% CO2 reduction target.

The latter two targets were binding and implemented immediately; the energy efficiency target is taking much longer to thrash out. Unfortunately, weaknesses in the EED will make it very difficult to achieve the ambitious 20% target.

Change is needed

Member States are required to make certain changes, among these: energy companies must make new savings equivalent to 1.5% of annual sales every year from 2014 to 2020; governments must renovate three per cent of their buildings each year; and large businesses must undertake energy-use audits every four years.

One of the most important measures in the EED package is the 1.5% annual savings target for energy companies, which has the potential to create significant savings and encourage energy efficiency financing. However, its impact could be weakened by too-flexible targets and measures. Other provisions - such as overhauling Europe's public buildings to make them more energy efficient - also lack teeth. With no binding national energy saving targets and weak energy efficiency measures, the EU will struggle to cut the cost of energy imports, which stood at €488 billion in 2011, or 3.9% of GDP.

Member State committment

Only if the directive is wholeheartedly embraced by Member States could it bring major savings. Energy efficiency measures can also create jobs, and therefore offer a welcome boost to struggling European economies. However, implementation will be key. The EED is a good starting point, but until Member States finalise their National Energy Efficiency Action Plans and transpose the directive into national law, we can’t be sure how effective it will be.

UK snapshot

UK citizens could look to Westminster for an indication of how serious their government is about saving energy. When Conservative MP Zac Goldsmith recently asked Energy and Climate Change Minister Gregory Barker what the UK had done to meet EU energy efficiency targets, he received this flaccid response: “The target to reduce primary energy consumption by 20% by 2020 relative to business as usual applies to the EU as a whole. The UK does not currently have a target to reduce primary energy consumption by 20% by 2020 relative to business as usual.”

Barker’s comments suggest the UK’s implementation might be less than ambitious; and if the ‘greenest government ever’ doesn’t fall in line, isn’t it optimistic to expect other Member States will?

For more musings on energy and EU related matters, please visit ClientEarth's blog, HotAir.

Image: Energy Efficiency Concept via Shutterstock