What are EEOs, WCs, ESOs, etc? – Recent EU and Global Experience
What’s in a name? That which we call an EEO, by any other name would still save energy. Whether called energy efficiency obligations (EEO), white certificates (WC), energy supplier obligations (ESO), or energy efficiency performance standards (EEPS), these policy mechanisms create an obligation for an energy company or legal entity to save end-use energy through efficiency measures. While they vary greatly in their program details, all are backed by penalties or financial incentives. Speaking at an energy efficiency obligation workshop hosted by the Latvian Ministry of Economics, Eoin Lees provided a fundamental overview of how EEOs work, global experience with various approaches to EEOs, typical administrative procedures and program costs in the European Union, and options for delivery mechanisms. Thoughtfully implemented, EEOs not only help avoid energy generation costs, defer grid investments, and reduce line losses, they also provide health benefits, reduce the marginal costs of meeting renewable generation targets, and lower credit and collection costs by boosting customer affordability.