The agreements reached on energy efficiency, energy governance and renewable energy over the past fortnight by the EU Institutions, fall well short of a comprehensive approach on energy efficiency. The much-coveted deals on targets came at the expense of an actionable framework to apply energy efficiency at all levels of the energy value chain and across all energy sources.

The deal on the Energy Efficiency Directive (EED) review sets an EU headline target of 32.5% for 2030, with the option to express national contributions in either primary energy or final energy or both. This level of flexibility is inconsistent with the overall objective of the EED, which aims that all Member States use energy more efficiently at all stages of the energy chain, from production to final consumption. Commenting on this development, Hans Korteweg, COGEN Europe Managing Director, said: “Instead of only focusing on final energy savings, which represent only a portion of the energy used in the system, one should focus on primary energy, where the biggest potential for energy efficiency lies. Accounting for primary energy gives Member States the full picture of the energy system, providing sufficient flexibility to cost effectively reduce losses in both energy supply and demand.”

It is also key to properly measure the efficiency of the whole electricity system, taking into account the real energy mix and impact of seasonal demand and supply patterns. The Primary Energy Factor for electricity (PEF) is a key instrument to achieve that. The default EU PEF value of 2.1 agreed as part of the EED deal does not reflect the significant energy losses in the electricity systems of many Member States and is not reflective of the electricity mix used during the heating season. Hans Korteweg commented: “The average efficiency of electricity delivered to consumers is below 50%, and even lower during peak demand or in winter. This means that more than half of the energy is lost in inefficient power plants and grids before it can reach the consumer. A PEF that is too low, underestimating the energy wasted in the electricity sector, will undermine efforts to increase efficiency and decarbonise. We must therefore ensure that the EED’s EU PEF is not applied arbitrarily to key energy sectors, like heating.”

The weak focus on energy efficiency is also reflected in the Renewable Energy Directive (RED II) agreement from 14 June. Instead of prioritising support for biomass use in cogeneration plants, reaching efficiencies above 75%, Member States may still subsidise much less efficient power-only plants. What is more, no specific efficiency conditions apply to biomass plants below 50 MW. The compromise waters down the European Commission’s original proposal. It is also less ambitious than the existing EU energy efficiency legislation, which foresees that all power-only plants above 20 MW should first consider cogeneration. “Bioenergy, geothermal, hydrogen and solar thermal fuels can be used in cogeneration plants as a way to increase the share of renewable energy in both electricity and heat, while putting energy efficiency first. Yet, without a push to prioritise the most efficient use of biomass with cogeneration, there is a risk that renewable electricity and heat from biomass will be supported separately, wasting EU citizens both money and energy”, said Hans Korteweg.

More positively, “energy efficiency first” is now defined as a core principle in the Energy Governance Regulation. Yet, it is up to Member States to implement this principle across the whole energy system. More ambition on energy efficiency will make better use of renewables and reduce our energy bills. Combining renewables and energy efficiency will lead to faster decarbonisation of our energy system.

Lastly, COGEN Europe calls for a substantive debate on the role of cogeneration in the future energy system. There is still an opportunity to address the main provisions covering cogeneration in the EED (article 14), not included in the Clean Energy Package. Evidence shows that the implementation of the EED framework for cogeneration has been unambitious in many Member States and needs to be addressed. COGEN Europe is committed to a resilient, decentralised and carbon neutral energy future with cogeneration as its backbone. It is time for policymakers to create the proper conditions to make that happen.

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ABOUT COGEN Europe

COGEN Europe, the European Association for the Promotion of Cogeneration, is the cross-sectoral voice of the cogeneration industry. Its mission is to work with EU institutions and stakeholders to shape better policies and eliminate administrative, regulatory and market barriers to the wider use of cogeneration in Europe. It aims to build a robust evidence-base to show the benefits of cogeneration, using the expertise of its membership, and establishing strong coalitions and partnerships.

For further information please contact:

Thomas Vanhauwaert
Communications Officer
thomas.vanhauwaert@cogeneurope.eu
www.cogeneurope.eu