Bundesrat Critical of Commission Proposal for Energy Efficiency Directive

In its session on 14 October 2011, the German Bundesrat (Federal Council) voiced strong criticism concerning the European Commission’s proposal made in June for a directive of the European Parliament and the European Council on energy efficiency. The Federal Council asked the government to make every effort to ensure that the proposal will be fundamentally reworked.

It welcomed the efforts to tap the energy efficiency potential contained in energy consumption and generation, the Federal Council said. However, the Bundesrat warned that the proposals had wide-ranging effects for enterprises and public authorities. As its implementation entailed investments worth billions of Euros, without it being clear where the funding should come from, the proposal was not acceptable in the current form, the Federal Council said. Besides the Bundesrat demanded that the competitiveness notably of small and medium-sized enterprises must not be endangered and consumer protection aspects be accorded greater attention.

Surveys by the Commissions in the member states suggested that that the EU will achieve only half of its indicative 20 % energy efficiency target for 2020. Therefore the Commission put forward a new Energy Efficiency (EEP) on 8 March 2011 to give fresh momentum to energy efficiency. The legislative proposal builds on the EEP and transforms certain aspects thereof  into binding measures in order to  to make a significant contribution to meeting the EU’s 20% energy efficiency target for 2020. The draft directive itself summarises the key points as follows:

“For end-use sectors, the proposed Directive focuses on measures that lay down requirements on the public sector, both as regards renovating the buildings it owns and applying high energy efficiency standards to the purchase of buildings, products and services. The proposal requires Member States to establish national energy efficiency obligation schemes. It requires regular mandatory energy audits for large companies and lays down a series of requirements on energy companies regarding metering and billing.

For the energy supply sector, the proposal requires Member States to adopt national heating and cooling plans to develop the potential for high-efficiency generation and efficient district heating and cooling, and to ensure that spatial planning regulations are in line with these plans. Member States must adopt authorisation criteria that ensure that installations are located in sites close to heat demand points and that all new electricity generation installations and existing installations that are substantially refurbished are equipped with high-efficiency CHP units. Member States should however be able to lay down conditions for exemption from this obligation where certain conditions are met. The proposal also requires Member States to establish an inventory of energy efficiency data for installations undertaking the combustion of fuels or the refining of mineral oil and gas and sets requirements on priority/guaranteed access to the grid, priority dispatch of electricity from high-efficiency co-generation and the connection of new industrial plants producing waste heat to district or cooling networks.

Other measures proposed include efficiency requirements for national energy regulatory authorities, information and awareness-raising actions, requirements concerning the availability of certification schemes, action to promote the development of energy services, and an obligation for Member States to remove obstacles to energy efficiency, notably the split of incentives between the owner and tenant of a building or among building owners.

Finally, the proposal provides for the establishment of national energy efficiency targets for 2020 and requires the Commission to assess in 2014 whether the Union can achieve its target of 20 % primary energy savings by 2020. The Commission is required to submit its assessment to the European Parliament and the Council, followed, if appropriate, by a legislative proposal laying down mandatory national targets.”

Energy-efficiency and the costs thereof have also been controversial between the Bundestag (German Parliament) and the Federal Council when the legislative package that lead to the turnaround in the German energy policy was voted on on 8 July 2011. The only bill the Bundesrat eventually did not approve of was the Act on Fiscal Measures Promoting Energy-Efficient Renovations of Residential Buildings (Gesetz zur steuerlichen Förderung von energetischen Sanierungsmaßnahmen an Wohngebäuden), which aimed at promoting the energy-efficient renovation of buildings older than 1995 by giving tax incentives. The incentives should encourage energy-savings in the building sector that accounts for 40% of the German energy consumption.

The states opposed the bill for fear of tax losses, which they want to be compensated for by the Federation. Pursuant to the draft bill, tax losses of states and municipalities would have amounted to roughly EUR 900 million for a period of twelve months. Higher figures are feared by some. To date it is still unclear, whether in the absence of such a decision by Bundesrat, the government will invoke the Mediation Committee to find consensus between the Bundestag and the Bundesrat or present a revised proposal for energy efficient renovation.

Source: Bundesrat

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