Danes usher in weakened EU energy requirements

Reduction initiatives are hoped to both create savings and stimulate economic growth

A commitment to reduce European energy consumption by 17 percent by 2020 is being seen as a partial victory for the Danish EU presidency that led the negotiations.

Some groups argued, however, that the final commitments outlined in the Energy Efficiency Directive (EED) were significantly weakened, particularly given that the initial 20 percent energy savings target the European Commission proposed last year could not be achieved.

But the climate minister, Martin Lidegaard (Radikale) said that the commitment was ambitious, considering the tough negotiations.

“Just a few months ago the European Parliament and the European Council were so far apart that an agreement was unthinkable," Lidegaard wrote in a press release. "But now we have taken another big step towards a more sustainable energy future."

“It’s only 17 percent because that was possible to get,” Lidegaard said according to EurActiv, an EU news website. “We fought like lions. We started at 13 percent, and now we have 17 percent, and that is actually something we are proud of.”

The EED will cost 180 billion kroner a year until 2020, according to Danish calculations, but it will save companies and consumers 2.5 trillion kroner due to reduced fuel expenditures and reduced costs associated with energy generation and distribution.

The EED is also hoped to stimulate the European economy by creating 400,000 jobs and raising European GDP by 255 billion kroner in 2020, while also saving every European household up to 7,000 kroner a year.

These jobs will be created as European countries put the directive into practice, and as a result the EED will form a key part in the negotiations later this June into the creation of a European growth treaty according to the EU climate commissioner, Connie Hedegaard.

"All the governments of Europe say they want growth and they want something that can create jobs in the short term,” Hedegaard said according to Reuters. “No matter how hard they think about it, it will be very difficult to think of better ideas.”

In addition to stimulating the European economy and creating jobs, the EED will also contribute to the EU reaching its target of an 80 to 90 percent reduction in carbon emissions by 2050, which is hoped to reduce Europe’s dependency on imported energy – the cost of which rose from 630 billion kroner in 1999 to 3.6 trillion kroner in 2011, according to the International Energy Agency.

Pressure on energy companies

For Lidegaard, the result was less than hoped, but better than expected (Photo: Scanpix)But while increased building insulation and more efficient technology will make a significant contribution, energy companies will be given a 1.5 percent annual efficiency target.

Much of these reductions are hoped to be achieved by helping their customers reduce their energy use.

Majority Danish state-owned energy provider Dong Energy already works closely with 130 businesses to reduce their energy consumption.

According to Lars Clausen, Dong’s executive vice president, the EED will help bring about significant savings for industry while also boosting job creation across Europe.

“Our experience in Denmark proves that energy companies can build a business based on saving their customers money by implementing energy efficiency measures,” Clausen said. “I was sceptical at first, but over the last five years we’ve helped large businesses and institutions, including helping Novo Nordisk to use around 30 percent less energy, saving it around 40 million kroner a year.”

Dong is helped by a political climate in Denmark that firmly backs low-carbon and renewable energy solutions to stimulate economic growth.

Creating green growth was a key ambition for Denmark as it took over the EU presidency in January. While the government this March agreed on an ambitious energy plan that hopes to end Denmark’s reliance on fossil fuels by 2050.

UK and Poland scupper talks

Not all countries share these ambitions, however, with both the UK and coal-dependent Poland providing considerable opposition throughout the negotiations.

The UK was successful in reducing the ambition of the EED, according to Dave Timms, an energy campaigner for environmental group Friends of the Earth.

"The UK government played a particularly significant role in weakening the directive by opposing an overall binding energy saving target and, at the last minute, insisting on loopholes so it could claim credit for old policies as a way of meeting its future obligation,” Timms told the Guardian.

Timms was referring to a late change insisted on by the UK in which energy companies could fulfil a quarter of the 1.5 percent annual energy reduction through energy savings schemes that have already been introduced.

After European ministers agreed today to adopt the directive, Greenpeace Denmark blamed Poland and its dependence on coal for limiting Europe’s environmental ambitions.

“The longer the Polish government drags its feet, the longer EU’s residents and economy will miss out on the benefits of a green transition in our energy system," spokesperson Frauke Theis, a Greenpeace spokesperson said.