Efficiency First: A New Paradigm for the European Energy System
In February 2015, the principle of Efficiency First was formally endorsed by the European Commission within the framework of the Energy Union.
This policy brief sets out how the Efficiency First principle can help the Energy Union to deliver on the three goals of competitiveness, energy security, and decarbonisation. It also identifies the changes needed to the Energy Union governance framework to make Efficiency First work in practice. Recommendations include:
- Use consistent demand projections that assume all of the EU’s existing energy and climate goals are met in energy plans and models;
- Employ a societal perspective (use appropriate discount rates) when assessing the impact of efficiency policies;
- Make Efficiency First a bedrock of national climate and energy plans under the Energy Union;
- Set a binding 40 percent energy efficiency target for 2030;
- Extend and tighten up energy efficiency obligations under the Energy Efficiency Directive;
- Make efficiency a principle of energy system design;
- Use Efficiency First to guide EU funds; and
- Get local and regional governments involved.
Efficiency First comes down to prioritising investments in energy efficiency—whether end-use savings or demand response—whenever they would cost less or deliver more than investing in supply or networks. Applying this logic to all energy policy decisions can strengthen Europe’s economic recovery, lower fuel imports, build competitiveness, create jobs, improve air quality, and bring down the costs of the transition to a low-carbon society.
Experts from the Regulatory Assistance Project, E3G, ClientEarth, eceee, the Smart Energy Demand Coalition, CAN Europe, Friends of the Earth Europe, OpenExp, and the European Climate Foundation contributed to this policy brief. The European Commission’s Vice President for Energy Union, Maros Šefcovic, welcomed the initiative and provided an introduction to the briefing.
A companion brief, Governance for Efficiency First: “Plan, Finance and Deliver,” identifies ten near-term actions the European Commission should take to make Efficiency First a reality.