21st Oct 2016

EU should favour energy efficiency over renewables, says industry

  • Investing in energy-saving technologies will reduce CO2-emissions more than investing in renewable energy, says EU business (Photo: European Community, 2005)

The European Union should focus on increasing energy efficiency rather than on promoting renewable energy if it wants to keep its industrial base and tackle climate change, a major EU business confederation has said.

"By saving on the use of energy, we'll keep our industrial base in Europe which is important for jobs and growth," Ernest-Antoine Seillière, president of BusinessEurope - a Brussels-based business confederation representing 20 million European companies - said on Monday (26 November).

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Saving on energy would reduce costs for European firms, giving a competitive advantage over firms from other countries.

Emerging economies, like Brazil, Russia, India and China (BRIC) are on average less than five times as energy-efficient as EU firms. EU firms are also more energy-efficient than US firms, but less than Japanese.

"It will also helps us tackle the very dramatic problem of climate change," he added, referring to the fact that energy savings usually imply less greenhouse gas emissions.

The business organisation also noted that research conducted by consultancy firm McKinsey for the German economy has shown that there are currently many energy-saving technologies readily available that are profitable and cost-effective.

According to McKinsey, these technologies could lower energy demand by more than 20% by 2020.

But these technologies are seldom applied at the moment because companies, and in particular small and medium-sized companies, often lack the required information or expertise, said Folker Franz, a senior adviser for environmental affairs at BusinessEurope.

The organisation said that despite various green initiatives by the commission as well as the overall EU target of becoming 20% more efficient by 2020, no real priority has been given to energy efficiency.

"We need a stronger sense of urgency. We need to invest now in order to be able to bear the fruits in the coming decades," Mr Seillière said.

If other countries in the world follow the European example, even steeper reductions - up to 25% - in energy consumption and CO2-emissions could be achieved globally.

Renewable energy less effective

The business confederation said it does not believe that renewable energy can bring about the same energy reduction results as an energy-efficiency approach.

"We're in favour of renewable energy, but we don't believe that the 20% reduction target is realistic if we focus on renewables," Mr Sellière said.

"We should also look at whether it is affordable," he added.

A related problem is the existence of 27 national renewable energy programmes in the EU - one per member state, making investments less efficient.

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