Energy saving obligations and obligation schemes

Energy saving obligations and obligation schemes mandate energy providers to achieve specific energy savings targets, thereby driving improvements in energy efficiency across various sectors. The primary goal is to ensure energy providers reduce energy consumption through efficiency measures, stimulating investments in energy-efficient projects and technologies, and supporting the EU’s national and climate targets. These obligations benefit consumers by lowering energy bills and improving the quality of life through enhanced energy efficiency. By setting clear targets, defining eligible measures, implementing robust monitoring systems, and including flexibility mechanisms and incentives, energy saving obligations ensure systematic and measurable progress towards energy efficiency and climate neutrality, highlighting the multiple benefits of energy efficiency for both the environment and the economy.

Goal and Objectives

The primary goal of energy-saving obligations and obligation schemes is to mandate energy providers to achieve specific energy savings targets, thereby driving improvements in energy efficiency across various sectors. The objectives associated with this element include:

1. Achieving Energy Savings: Mandating energy providers to reduce energy consumption through efficiency measures.
2. Encouraging Energy Efficiency Investments: Stimulating investments in energy efficiency projects and technologies by energy providers.
3. Supporting Policy Goals: Helping to meet national and EU-wide energy efficiency and climate targets.
4. Benefiting Consumers: Reducing energy bills and improving the comfort and quality of life for consumers through enhanced energy efficiency.

Methodologies or Approaches for Implementation

To achieve these goals and objectives, the following methodologies and approaches are recommended:

1. Setting Clear Targets: Establishing specific, measurable energy savings targets for energy providers to achieve within a defined timeframe.
2. Defining Eligible Measures: Clearly specifying which energy efficiency measures and technologies qualify for achieving the targets.
3. Monitoring and Verification: Implementing robust systems for monitoring, reporting, and verifying the energy savings achieved by energy providers.
4. Flexibility Mechanisms: Allowing flexibility in how energy providers meet their obligations, such as through trading of energy savings certificates or partnering with third parties.
5. Incentives and Penalties: Offering incentives for overachievement and imposing penalties for non-compliance to ensure energy providers are motivated to meet or exceed their targets.
6. Supporting Vulnerable Consumers: Including provisions to ensure that energy efficiency improvements benefit vulnerable and low-income consumers.

Integration with EED Goals and Key Elements

Energy saving obligations and obligation schemes are integral to the overarching goals of the Energy Efficiency Directive (EED) and support several key elements:

• Energy Efficiency First Principle: Energy saving obligations prioritise energy efficiency by mandating that energy providers implement efficiency measures before considering additional energy supply options.
• Energy Efficiency Targets: These obligations are a direct mechanism to achieve the energy efficiency targets set out in the EED, ensuring systematic and measurable progress.
• Alignment with Higher Climate Neutrality Goals: By driving significant energy savings, obligation schemes support the EU’s higher climate neutrality goals by reducing greenhouse gas emissions and promoting sustainable energy use.
• Multiple Benefits of Energy Efficiency: Energy saving obligations highlight the multiple benefits of energy efficiency, such as lower energy costs, reduced environmental impact, and enhanced energy security, encouraging broader acceptance and implementation.
• Heating and Cooling Planning: Energy saving obligations can include measures specific to improving the efficiency of heating and cooling systems, supporting broader heating and cooling planning efforts.
• Heat and Cooling Supply: Obligation schemes can drive investments in efficient heat and cooling supply technologies, reducing energy consumption in these critical areas.
• Transformation, Transmission, and Distribution: Improving the efficiency of energy transformation, transmission, and distribution can be part of the measures undertaken by energy providers to meet their obligations.
• Exemplary Role of the Public Sector: The public sector can participate in or support obligation schemes by implementing energy efficiency measures in public buildings and operations, demonstrating leadership.
• Exemplary Role of Public Buildings: Public buildings can serve as key sites for implementing energy-saving measures mandated by obligation schemes, showcasing best practices.
• Energy-Efficient Public Procurement: Energy-efficient public procurement practices can support the fulfilment of energy-saving obligations by ensuring public sector purchases contribute to overall energy savings.
• Energy Saving Obligations and Obligation Schemes: This element itself underscores the importance of mandatory energy savings targets and the mechanisms for achieving them.
• Energy Audits and Energy Management: Regular energy audits and effective energy management practices are essential for identifying opportunities to meet energy-saving obligations.
• Efficiency in Data Centers: Data centres, with their high energy use, can be targeted by obligation schemes to improve their energy efficiency, achieving substantial energy savings.
• Billing Information: Providing consumers with detailed billing information can help them understand their energy use and encourage energy-saving behaviours, supporting the goals of obligation schemes.
• Awareness Rising: Raising awareness about the benefits and opportunities of energy-saving obligations can drive consumer engagement and support for energy efficiency measures.
• Empowering and Protecting Vulnerable Consumers: Ensuring that obligation schemes include measures to protect and empower vulnerable consumers helps address energy poverty and ensures equitable benefits.
• Energy Professionals: Training and employing skilled energy professionals to implement and verify energy-saving measures ensures that obligation schemes are effective and credible.
• Energy Services: Energy service companies (ESCOs) can play a key role in helping energy providers meet their obligations through the delivery of energy efficiency projects and services.
• National Energy Efficiency Fund and Financing: Accessing national energy efficiency funds and financing options can support the implementation of measures required to meet energy saving obligations.
• National Technical Support: Technical support at the national level helps energy providers and other stakeholders effectively implement and manage energy saving obligations.

By integrating energy saving obligations and obligation schemes across these key elements, the EED ensures a comprehensive approach to improving energy efficiency, driving cost-effective energy savings, and supporting the EU’s broader climate and energy goals.

Additional resources

1. https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX%3A52013SC0451
2. The future of Energy Efficiency Obligation Schemes in the EU https://publications.jrc.ec.europa.eu/repository/handle/JRC106669
3. Energy efficiency obligation schemes: their future in the EU https://publications.jrc.ec.europa.eu/repository/handle/JRC111968
4. Costs and benefits of energy efficiency obligations: a review of European programmes: https://www.eceee.org/library/conference_proceedings/eceee_Summer_Studies/2017/2-policy-governance-design-implementation-and-evaluation-challenges/costs-and-benefits-of-energy-efficiency-obligations-a-review-of-european-programmes /
5. Energy community policy guidelines for Energy Efficiency Obligation Schemes: https://www.energy-community.org/dam/jcr:7907f720-0904-48a0-9773-2bd948ff2799/EBRD_EnCS_PG_EE_112018.pdf