New EU-COM report on “The macro-level and sectoral impacts of Energy Efficiency policies”

The EU-Commission has published a recent study conducted by Cambridge Econometrics, Ernst & Young and SQ Consult.

From the Executive Summary

This report sets out the potential positive and negative impacts of improvements to energy efficiency in Europe. The analysis presented in this report covers the macroeconomic, social and environmental impacts that could come about through increasing the EU’s 2030 target for energy efficiency beyond a level of 27% in comparison to baseline projections, to 30% or beyond. Parts of this report (notably the literature review included in Appendix D) build also on the work carried out for a previous study for the European Commission1, which focused on the economic, environmental and social impacts of improved energy efficiency in buildings. This is referred to in the text as ‘the EPBD report’.

Successive studies have shown that energy efficiency offers many of the most cost- effective options for meeting global greenhouse gas emission reduction targets. In many cases, energy efficiency measures have been shown to be ‘negative cost’, meaning that it would be economically advantageous to implement them. In this analysis, a wide range of potential effects is considered, covering the three pillars of economic, social and environmental sustainability.

In this report, four different scenarios are assessed, based upon the policy options set out in the EED Impact Assessment (EC, 2016). The timeframe for the analysis is 2030. Some of the results of the work undertaken have been included already in the EED Impact Assessment. This report offers a more detailed explanation of the methodology used and additional results from scenarios produced by the E3ME model which are not fully comparable to the results of scenarios presented in the EED Impact Assessment.

The inputs for each scenario have been derived from PRIMES model results, providing consistency with the full Impact Assessment. Six impact areas have been covered:

– Economy and labour market

– Health

– The environment

– Social cohesion

– Public budgets

– Industrial competitiveness

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New report: Multiple Benefits of energy renovations of the Swedish building stock

The COMBI partner Copenhagen Economics has recently published a study conducted for the Swedish Energy Agency and the National Board of Housing, Building and Planning.

Background: The Swedish government is currently in the process of designing a new building strategy, including a program for renovating the existing building stock.

Main conclusions:

  • The value of energy savings is the largest source of benefits from renovations of the Swedish building stock.
  • reduced outdoor air pollution can deliver significant benefits. Attributing the value of outdoor air pollution can be difficult, as air pollution is windborne, and may not necessarily give rise to damages in the same area as the polluting source.
  • Improved indoor air quality is a large potential source of value for Swedish society. Prevalence of asthma and respiratory diseases, and especially so called sick building syndrome are common undesired consequences of poor indoor air quality. In addition, improved indoor air in schools is likely to improve students’ learning abilities. Taking advantage of these benefits requires that renovations have a broader focus than just on energy savings, and especially on delivering better ventilation and lighting.

Read the study on the website of Copenhagen Economics.

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G20 EE Investment toolkit highlights multiple benefits

The G20 Energy Efficiency Investment Toolkit is a collaborative work of 15 participating country members of the G20’s Energy Efficiency Finance Task Group, co-chaired and coordinated by France and Mexico.

It offers a new perspective on the challenge of scaling-up energy efficiency investments by defining and separating “core” energy efficiency investments (those stand- alone projects where the delivery of energy savings is the lead driver) and “integral” energy efficiency investments (where overall asset performance is the lead driver, yet multiple benefits -including improved energy performance- are delivered by an incremental “embedded” investment). The Toolkit also provides insights into national policy developments, showcasing good practices, as well as an insight into policy tracking databases, using the Voluntary Energy Efficiency Investment Principles as a frame for their comparison. Finally, the Toolkit reveals how public and private sector financial institutions are tackling the energy efficiency investment challenge, through their commitments, approaches, tools and by sharing the areas that they identify for further joint development.

The document highlights the importance of accounting for multiple impacts on national and investor scale.

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Download the G20 EE Investment Toolkit

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COMBI lecture at Jadavpur University

COMBI-researcher Souran Chatterjee (partner CEU/ABUD) gave a lecture on

Productivity impact from multiple impact perspective

Full economic assessment is required to understand the full potential of any energy policy. However, today these assessments often do not include important factors such as co-benefits/multiple impacts of any energy policy. The inclusion of additional impact into decision-making analysis may influence any policy maker to design a better policy portfolio. Most of the time, multiple impacts of energy efficiency policy are not incorporated into ex-ante policy analysis due to the absence of mature methodologies. Therefore, this research contributes to the methodological tool box by proposing the solutions to the key methodological challenges of aggregation of multiple impacts including the risks of double counting.

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New IEA/IRENA study finds global energy transition affordable – also due to multiple impacts

PERSPECTIVES FOR THE ENERGY TRANSITION
Investment Needs for a Low-Carbon Energy System

A recent study commissioned by the German G20 presidency to the IEA and IRENA sees energy efficiency as one main element for a Global energy transition. Only decreasing 2050 primary energy supply by 27% through energy efficiency allows meeting 65% of this demand with renewable energy.

Total investment of around 145 bn US$ in energy supply would only slightly need to rise (by 1 bn/year) over today’s level to achieve climate targets, while there is significant additional investment needed in end-use sectors. However, twice to 6 times this amount would be saved by positive environmental and health impacts. Additional GDP effects will be around 0.7–1.7%, and additional human welfare effects are not even included therein. Around 6 mn additional jobs could be expected.

Scope of the study (from Executive Summary)

Investment is the lifeblood of the global energy system. Individual decisions about how to direct capital to various energy projects – related to the collection, conversion, transport and consumption of energy resources – combine to shape global patterns of energy use and related emissions for decades to come. Government energy and climate policies seek to influence the scale and nature of investments across the economy, and long-term climate goals depend on their success. Understanding the energy investment landscape today and how it can evolve to meet decarbonisation goals are central elements of the energy transition. Around two-thirds of global greenhouse gas (GHG) emissions stem from energy production and use, which puts the energy sector at the core of efforts to combat climate change.

Against this backdrop, the German government has requested the International Energy Agency (IEA) and the International Renewable Energy Agency (IRENA) to shed light on the essential elements of an energy sector transition that would be consistent with limiting the rise in global temperature to well below two degrees Celisius (2°C), as set out in the Paris Agreement. The overarching objective of this study is to analyse the scale and scope of investments in low-carbon technologies in power generation, transport, buildings and industry (including heating and cooling) that are needed to facilitate such a transition in a cost-effective manner, while also working towards other policy goals. The findings of this report will inform G20 work on energy and climate in the context of the 2017 German G20 presidency.

The analyses in this report are framed by several key questions which include:

  • How can the energy sector achieve a transition to a decarbonised, reliable and secure energy sector at reasonable costs?
  • What are the investment needs associated with the energy sector transition and how do investment patterns need to change to reach a low-carbon energy system?
  • What are the co-benefits for other energy policy objectives that could result from an energy sector transformation?
  • Assuming a timely and effective low-carbon energy sector transition, what is the outlook for stranded assets? What is the impact for stranded assets if action is delayed and the transition is sharper?
  • How does the trend of declining costs for renewables and other low-carbon energy technologies, as well as acceleration of efficiency gains, support the decarbonisation? How can policy accelerate this development?
  • What are the roles of carbon pricing and the phase-out of fossil fuel subsidies in ensuring a cost-effective decarbonisation of energy systems?
  • What are the roles of more stringent regulations, better market design and/or higher carbon prices for the energy sector transition?
  • What is the role of research, development and demonstration, and how can early deployment of a broad array of low-carbon technologies support an efficient and effective energy sector transition?

In order to address these questions, the IEA and IRENA separately have examined the investment needs for energy sector pathways that would foster putting the world on track towards a significant reduction in energy-related GHG emissions until the middle of this century. Each institution has developed one core scenario that would be compatible with limiting the rise in global mean temperature to 2°C by 2100 with a probability of 66%, as a way of contributing to the “well below 2°C” target of the Paris Agreement. Both the IEA and IRENA analyses start with the same carbon budget for the energy sector. But the pathways to reaching the goal differ between the two analyses: the modelling analysis conducted by the IEA aims at laying out a pathway towards energy sector decarbonisation that is technology-neutral and includes all low- carbon technologies, taking into account each country’s particular circumstances. The analysis conducted by IRENA maps out an energy transition that stresses the potential of energy efficiency and renewable energy sources to achieving the climate goal, while also taking into consideration all other low-carbon technologies.

While IEA and IRENA base their energy sector analyses on different approaches and use different models and/or tools, there are similarities in high-level outcomes that support the relevance for a pathway and framework for a timely transition of the global energy sector. In the following sections, key findings from the analyses of each organisation are presented.

Find the full study at the IRENA website.

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COMBI at World Sustainable Energy Days

COMBI-researcher Souran Chatterjee presented first draft productivity impacts from the project at the World Sustainable Energy Days 2017 conference in Wels/Austria.

Full economic assessment is required to understand the full potential of any energy policy. However, today these assessments often do not include important factors such as co-benefits/multiple impacts of any energy policy. The inclusion of additional impact into decision-making analysis may influence policy maker to design a better policy portfolio. Most of the time, multiple impacts of energy efficiency policy are not incorporated into ex-ante policy analysis due to the absence of mature methodologies. Therefore, this research contributes to the methodological tool box by proposing solutions to the key methodological challenges of aggregation of multiple impacts including the risks of double counting.

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COMBI blog post on social impacts of energy efficient buildings

COMBI researcher Nora Mzavanadze posted a blog entry on the website of Energy Vulnerability and Urban Transitions on an RMIT Europe workshop:

“RMIT Europe has gathered a number of experts from academia and industry to a half-day workshop on November 28, 2016 – “The social impacts of digitally-enabled energy efficiency in buildings: shaping sustainable energy futures”. The participants discussed energy consumption trends in the residential buildings’ sector, the possibilities that digital technologies could bring in understanding these trends and also in achieving reductions in energy consumption. Social impacts arising as a result of energy efficiency, energy conservation and renewable energy measures in residential housing has been at the center of presentations and discussions […].”

Read full blog post

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EEA: Air pollution causes close to half mn premature deaths in Europe

Air pollution is causing around 467,000 premature deaths in Europe every year, the European Environment Agency (EEA) has warned. People in urban areas are especially at risk, with around 85% exposed to fine particulate matter (PM2.5) at levels deemed harmful by the World Health Organization (WHO). These particles are too small to see or smell, but have a devastating impact.
PM2.5 can cause or aggravate heart disease, asthma and lung cancer.

How big is the problem?

It’s pretty bad. Within the European Union (EU), more than 430,000 people died prematurely due to PM2.5 in 2013, the most recent year with figures available.

Read BBC article

Full EEA report

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Seminar on social impacts of building EE in Spain

Half day seminar addressing the social impacts of energy efficient buildings to ensure a more sustainable future

Date & time: 28 Nov 2016, 10:00 am-02:30 pm (CET)

Venue: RMIT Europe, Minerva 2, 08006 Barcelona, Spain

Cost: Free

Traditionally, policymakers and researchers have focused on the techno-economic approach in assessing the impacts of energy efficient buildings (EEB). However, with sustainable energy becoming a prominent topic in recent times, there has been a growing need to widen the scope to include both social and ethical factors. This seminar brings together insights from academia and industry to shed light on reasons why society should account for human experience, activity and social practices in influencing energy consumption, and how these understandings can help plan for a sustainable future.

COMBI researcher Nora Mzavanadze will be a speaker at the seminar.

Find out more

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