Key Principles of Energy Savings Obligations
Governments in various jurisdictions around the world are endeavoring to improve end-use energy efficiency by designing and implementing schemes that place Energy Efficiency Obligations (EEOs) on particular parties. Eoin Lees provided the Czech Ministry of Trade and Industry with an in-depth look at the key principles of EEO schemes, the reasons why governments favor this particular mechanism, and an overview of the EU’s experience with EEOs. An EEO is a regulatory instrument that requires obligated parties to meet quantitative energy savings targets by delivering or procuring eligible energy savings. The savings must be the result of approved end-use energy efficiency measures. These systems are characterized by three key features. They establish a quantitative target for energy efficiency improvement, they require obligated parties to meet this target, and they establish a framework defining eligible energy savings activities, methods for measuring and verifying the resulting energy savings, and confirming that the activities actually took place. Governments clearly favor EEOs, as France, Denmark, Italy, and the United Kingdom have all expanded their respective programs in recent years. Mr. Lees illustrated how EEOs can dramatically increase energy efficiency activity, can provide policy options for deploying sustainable energy, and can allow the governments to utilize the technical expertise of energy companies.