IEA Gives Report Card on Energy Efficiency in Europe

(Paris) October 15, 2009—The International Energy Agency (IEA) launched a new publication, Implementing Energy Efficiency Policies: Are IEA Member Countries on Track?  The report analyses to what degree IEA member countries have implemented the agency’s 25 energy efficiency recommendations which it believes could reduce worldwide carbon emissions by 8.2 gigatonnes per year by 2030. 

To support governments with their implementation of energy efficiency, the IEA recommended the adoption of specific energy efficiency policy measures to the G8 summits in 2006, 2007 and 2008. The consolidated set of recommendations to these summits covers 25 fields of action across seven priority areas: cross-sectoral activity, buildings, appliances, lighting, transport, industry and power utilities.

At the 2007 IEA Ministerial Meeting, Energy Ministers placed energy efficiency high on the agenda. They “strongly welcomed” the energy efficiency recommendations and invited the IEA “to evaluate and report on the energy efficiency progress of IEA member and key nonmember countries.”

This report evaluates the progress of all IEA member countries in implementing energy efficiency policy, including the 25 IEA recommendations. The report also addresses whether IEA countries are on track to maximize their implementation of energy efficiency policies.

Information in this report is current up to March 31, 2009. Conclusions are based on country completion of a detailed questionnaire measuring energy efficiency policy implementation and subsequent IEA review and analysis.

The IEA finds many positive examples of energy efficiency policy implementation in IEA member countries. Governments are investing in a wide array of well-known energy efficiency policies from national strategies to minimum energy performance standards for appliances and equipment. There are also signs of energy efficiency policy innovations. These include the widespread development of energy efficiency strategies and action plans, innovative financial instruments, active policies promoting energy efficiency in buildings, the extensive adoption of standby power policies and policies to phase out inefficient lighting, and innovative policies to create incentives for utilities to promote energy efficiency.

But is the current suite of energy efficiency policies enough? Are IEA member countries on track to meet pressing economic, environmental and energy security challenges? The answer to this is no.

Evidence in the IEA publications, World Energy Outlook 2008 and Energy Technology Perspectives 2008 suggests that there is a need to increase the rate of energy efficiency improvement significantly and urgently across all countries, even beyond what can be achieved with the current 25 IEA recommendations.

There is certainly room for further energy efficiency action in IEA member countries. For example, no IEA member country has “˜fully’ or “˜substantially’ implemented more than 57 percent of the relevant IEA recommendations, and two countries report less than 10 percent “˜substantial implementation.’

Why is it that IEA member countries have not implemented the full suite of cost-effective energy efficiency policies or equivalent measures their leaders endorsed? Energy efficiency continues to face pervasive barriers including lack of access to capital for energy efficiency investments, insufficient information, principal-agent problems and externality costs that are not reflected in energy prices. Political commitment to maximizing implementation of energy efficiency policies may also have been challenged by the current economic crisis. Energy efficiency programs must compete for funding with other priorities such as employment, health and social security.

This report shows that IEA member countries are implementing a full range of energy efficiency activities. However, more action is needed to ensure IEA countries are on track to meet pressing energy-related challenges. To address the action gap, IEA member countries need to urgently extend their efforts in energy efficiency policy.

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