Energy Efficiency Plan

On 8 March the European Commission published its long awaited Energy Efficiency Plan. The energy efficiency of buildings is a priority issue for CEPI and we welcome the attention paid to improving the energy efficiency of the existing building stock. We particularly welcome the fact that the Commission has recognised that the problem of split incentives must be addressed. In December 2010 CEPI published a joint statement with UIPI on the landlord/tenant dilemma, or who pays for the cost of the work, and who gets the benefit of savings in energy costs. Action has already being taken in some countries to tackle this problem, but it is important to continue to raise awareness of it at a European level and to promote possible solutions within national legal systems. This matters not only to landlords and tenants but also to those who work in the building sector and have to deal with conflicting interests. 

Energy efficiency is at the heart of the EU’s Europe 2020 Strategy for smart, sustainable and inclusive growth. The Energy Efficiency Plan published on 8 March 2011 is a strategy paper which will be followed by legislative proposals. The Commission still sees untapped potential for energy savings in the building sector and wants to introduce instruments which will trigger the renovation process in both public and private buildings. The subject of binding targets to be imposed on Member States is controversial, and here the Commission has introduced a compromise whereby the Commission will first of all monitor the implementation of national energy efficiency targets and then check in 2013 whether they will deliver the objective of a 20% saving by 2020. If not, then binding targets may be considered.

There is a focus on encouraging the public sector to lead by example and there are binding measures proposed:
- Requiring public authorities to refurbish at least 3% of their buildings (by area) each year;
- Requiring high standards of energy efficiency to be systematically applied when public authorities purchase goods, services and works.

For the private building sector:
- The plan recognises that the “split incentive” between landlord and tenant is a barrier to upgrading buildings in terms of their energy performance. The Commission will bring forward legislative provisions requiring Member States to introduce measures – in line with national property law – to address this problem.
- The plan also recognises the potential benefits of energy performance contracting in the refurbishment of buildings. This involves renovation by energy service companies at their own cost with the incentive that they make a profit by receiving the difference between the energy costs before and after renovation over a defined period of time. There are legal forms of obstacles to this form of contracting in some Member States. The Commission will bring forward legislative proposals to overcome these problems in 2011.

The Commission will also look at financial support systems to create financial incentives to trigger renovation and how these can be improved. CEPI welcomes the fact that the plan addresses some of the practical problems involved in achieving a higher rate of renovation. We encourage the Commission to look at the difficulties experienced in practice with the implementation of legislation on energy efficiency and also the realisation of the necessary work.

The plan is available here