04 August 2020
Energy efficiency: green recovery 'made in Europe'

By Monica Frassoni, President of the European Alliance to Save Energy, (pictured)
Summer 2020


Monica Frassoni, President of the European Alliance to Save EnergyThe Covid-19 pandemic is highly impacting our societies and is a major shock for the European and global economy.

In this difficult context, the European Union has the opportunity to relaunch its economy guided by its long-term climate commitments, namely becoming climate neutral by 2050, while at the same time providing support to its many citizens who suddenly lost their work and income.

The recovery packages being prepared should not only aim at countering the economic damage caused by the COVID-19 pandemic. They should prepare the ground for a more prosperous, resilient, and sustainable future for our continent and the world.

Energy efficiency can help policymakers address the multiple challenges we are all faced with.

Energy efficiency is paramount for climate mitigation. Through existing technologies, it is possible to reduce energy consumption, increase the efficiency of the entire energy system and accelerate the integration of renewables. According to the International Energy Agency (IEA), 76% of the European greenhouse gas emission reductions required to keep temperature increases below 1.5°C must come from energy efficiency.

In the European Union, energy efficiency is one of the pillars of the European Green Deal. In the recent proposal of a European Climate Law, energy efficiency is part of the defining elements of the EU's trajectory towards climate neutrality by 2050. Along the same lines, the current political focus on buildings renovations indicates that the EU institutions recognize the economic, social and environmental impact of a transition towards a highly efficient building stock. Last but not least, the European Commission recently highlighted in its EU Industrial Strategy that reducing emissions across industry, namely the most energy-intensive ones, will greatly depend on the wide implementation of effi ciency measures and on the Energy Efficiency First principle.

When it comes to industrial strategy, economic growth and job creation, indeed, the full application of the Energy Efficiency First principle to all energy policymaking, planning and investments, can be a real change maker for the energy efficiency value chain and, as a consequence of this, for the European economy.

Our continent hosts some of the most innovative and successful energy efficiency companies in the world. The members of the European Alliance to Save Energy are global "champions" that export technologies and drive innovation. Hundreds of other players, especially SMEs, operate in this fi eld across Europe.

Therefore, it is not surprising that the International Patent Classification green patents inventory of the World Intellectual Property Organization shows that among the countries with higher concentration of filing of patents in energy conservation technologies there are EU Member States such as Germany, France, and the Netherlands. In addition, the filing of energy conservation technologies patents (together with green transportation technologies) continue to grow despite the slowdown of other green patents technologies.

This demonstrates that the energy efficiency value chain is very much European. Therefore, investing in it will produce deep benefits in and contribute to stimulating the whole European economy.

Moreover, energy efficiency has a clear impact on local value chains, and it has the advantage of being "ready to use". A key example is given by the building renovation value chain. This is made of several sectors and professionals which are all needed to implement projects that can be started right away. This kind of investments are extremely useful to boost local economies after a shock like the current crisis. In addition, they are much safer than building highcost alternative energy infrastructures which may lock-in investments for years and waste taxpayer's money in stranded assets. Finally, this kind of investments will foster the creation of high-quality jobs, in an innovative and digitalised environment.

For these reasons, in an increasingly competitive global market where the European industry struggles to remain a leader, energy efficiency is a strategic way forward. This should be reflected in how strategic value chains and priority infrastructures are defi ned and selected at EU level. For example, through changes to the energy infrastructure governance in the revision of the TEN-E regulation, and by including a predominantly European energy efficiency value chain in the Important Project of Common European interest (IPCEI).

For Europe, investing in energy efficiency means investing in a sustainable recovery which is ‘made in Europe’. We can capitalize on this added value to achieve a fast, smart, and environment-friendly recovery while boosting long term competitiveness of a broad range of European sectors and industrial players.