Energy efficiency key to EU’s integrated energy system

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An integrated energy system is crucial to Europe achieving its 2050 climate neutrality target, however, energy efficiency needs to form the basis of the transition towards the integrated and renewable-energy-based energy system.

This is according to the European Committee of the Regions (CoR) in an opinion on the European Commission’s Strategy for Energy System Integration which was published in July 2020.

CoR defines energy system integration as the planning and operating of the energy system “as a whole” and across multiple energy carriers- electricity, heat, cold, gas, solid and liquid fuels – infrastructures and end-use sectors, such as buildings, transport or industry.

“Today, the EU’s energy system is technically and economically inefficient, and leads to substantial losses in the form of waste heat and low energy efficiency. An integrated energy system is therefore crucial to delivering on the European Green Deal’s objective of reaching climate neutrality by 2050,” according to a press statement released by CoR.

The recommendations issued by CoR would help the EU Commission to prepare a grid of the future capable of ensuring reliable power supply, powering both utilities and consumers whilst reducing carbon emissions as the transition to renewables amplifies. Today, energy production and consumption account for 75% of the EU’s greenhouse gas (GHG) emissions, and as such an increased adoption of renewables is vital to eliminate these emissions. However, renewable energy integration can only be optimised if the adoption of energy efficiency is solid both at the local and regional levels.

Energy efficiency would enable EU countries to accelerate coal retirement without the pressure of seeking the massive capacity required to replace baseload power demand which is currently being met by coal-fired generation in countries like Poland and by nuclear in countries like France.

The announcement follows CoR and the EU Commission’s recent partnership to accelerate energy efficiency in buildings. As part of the project, the two parties identified three areas in need to be revised to create some 160,000 new jobs in the energy efficiency and renewables sectors, improve energy savings for building owners and occupants and help reduce GHG emissions. The three areas include a revision of state aid schemes and more flexible budget rules to maximise investments and renovations, the implementation of subnational targets for the renovation of buildings and the integration of renewable energy sources.

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Apostolos Tzitzikostas, CoR’s president, said: “Making our buildings energy efficient will save money, reduce emissions and tackle energy poverty which affects 34 million people in Europe. We need to ensure that local and regional governments are aware of, and have access to, the unprecedented EU budget and recovery and resilience funds available. I am therefore delighted to launch our cooperation between the European Commission and our Committee to support the Renovation Wave in all our territories.”

The CoR rapporteur Gunārs ANSIŅŠ (LV/Renew Europe), Deputy Mayor of Liepāja, said: “The EU Strategy for Energy System Integration has a role to play in the economic recovery of local and regional authorities, particularly in the wake of the COVID-19 crisis. It is important to set the energy-efficiency-first objective at the local and regional level. Likewise, energy system integration can help local and regional authorities achieve greater energy efficiency as the available resources would be used for the transition to more efficient energy technologies.”

In a separate study conducted by the European Investment Bank, energy efficiency has been identified as the most effective measure to fight climate change by the majority of European citizens whilst Americans and Chinese slightly differed on the opinion as they are more confident in technological innovation as the best way to fight climate change.

In addition to increasing investments in energy efficiency, there is a need for programmes aimed at improving consumer and business awareness of the benefits energy efficiency brings in climate mitigation. This follows a study Going Green – Who is investing in energy efficiency and why it matters finding that EU firms are not prioritising energy efficiency due to a lack of knowledge and partly to lack of adequate funding.

In regard to expanding renewable energy generation, CoR highlights the potential of offshore wind energy in accelerating the energy transition and the necessity to support new offshore renewable technologies such as tidal, wave and floating offshore wind and solar technologies. In addition, the EU Commission has been recommended to ensure the reskilling and upskilling of the workforce in line with the specific needs of the offshore renewable energy sector.

However, CoR’s opinion Powering a climate-neutral economy: An EU Strategy for Energy System Integration calls for the inclusion of both local and regional authorities in planning the energy transition and this includes consumers, business, utilities and state regulators. This would ensure a just energy transition and that the path to an integrated and clean energy system of the future does not lead to increased energy tariffs. Since energy demand, generation and available infrastructure vary in EU countries, the inclusion of local and regional authorities would ensure these variations are catered for in the energy transition. In addition to increasing international energy connections to transport energy from regions of higher generation or low demand to countries with less generation for the reliability of the bloc’s energy network, CoR is calling for the development of intranational and interregional infrastructure while also increasing the capacity of transnational connections.

Physical barriers for the development of high quality interconnections between all EU regions to guarantee a genuine integration of the electricity system need to be removed, stresses CoR.

The imports of goods should only be allowed with countries that have the same GHG reduction standards with the EU, according to CoR, to ensure that the EU climate targets do not adversely affect the competitiveness of the EU and its businesses at the global level.

As the European Union still imports 58% of its energy, mostly through oil and gas, the integration of the EU’s energy system will improve security of supply while reducing dependence and use of fossil fuels. Better integration of energy systems will also increase energy savings and diversify and localise energy production, thus making Europe’s economy more resilient – a key aspect in crisis scenarios.