Unlocking the Promise of the Energy Union: "Efficiency First" is Key
With many Energy Union discussions focused on securing energy supplies first, RAP suggests that success of the Energy Union rests on prioritizing demand-side resources in a policy called “Efficiency First”. This policy brief highlights successful Efficiency First policies in power markets in the United States and suggests opportunities to adapt those policies for European markets. Recognizing that the Energy Efficiency Directive and other EU and Member State policies support some energy efficiency investments, the brief recommends an overarching Efficiency First mandate to maximize the benefits of demand-side resources. The author reviews a number of options for achieving this, including least-cost investment requirements, a loading order prioritizing demand-side resources, demand-side bidding in power markets, and non-wires solutions to congestion and reliability challenges. In addition to meeting the Energy Union goals of diversifying resources, increasing security, and meeting clean energy targets, demand-side resources also reduce costs and improve reliability.