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The UK’s hidden agenda

Heads of European Governments have ignored all the evidence on energy efficiency and failed to set binding targets. What was behind the UK’s opposition?

Not that long ago, I recall visiting the offices of those overseeing UK energy policy, to be greeted with a large poster that read: “Real Men Build Power Stations.” How things have changed, you might think.

The International Energy Agency now routinely describes energy efficiency as “the first fuel” option. This March the heads of the 28 European Union governments unanimously agreed that increasing investment in energy efficiency should be the “first step” taken to reduce energy imports and increase energy security.

The day after he became Secretary of State for Energy and Climate Change, Edward Davey launched the Energy Efficiency Deployment Office, promising that improving energy saving would be his “number one priority.”

Yet only last month the heads of European Governments set the continent‘s energy policy framework for the next fifteen years – and reverted to the old routine of demoting energy efficiency into an also-ran option, as a nice–to-have-but–not-essential idea. No commitments of any kind were agreed. Only an unambitious (and purely aspirational) target for energy efficiency improvements was even suggested for 2030, achieving which would result in actually reducing the speed of improvements currently being reached.

Everything concerning energy efficiency “will (sic) be delivered in a cost-effective manner” – not a criterion regularly required by policy makers for energy supply options. And ominously such policies will have to “fully respect the effectiveness (!) of the Emissions Trading System in contributing to overall climate goals”.

As to date nobody can demonstrate that this EU:ETS flagship policy scheme is contributing at all to reaching the existing climate goals, it is not clear quite how this “respect” for its “effectiveness” should be achieved. Except perhaps by requiring all energy efficiency programmes to be equally ineffective.

The stupidity is that every official study undertaken prior to this debacle had concluded that it would be very cost-effective to go for an ambitious and legally binding target. Last February the European Parliament called for a 40 per cent improvement in energy efficiency between 2005 and 2030, “in line with research on cost-effective energy saving potential.” Importantly, it would also deliver many other benefits.

Public policy benefits
In its own economic impact assessment, the European Commission stressed that, quite apart from addressing the threat of climate change, there would be a wide range of other public policy benefits from delivering a complimentary binding target – just as exist for renewables and greenhouse gas emissions – covering energy efficiency. It listed: “improvement in resource efficiency, security of supply, reduction of the negative trade balance for fossil fuels, localised environmental impacts, and health benefits.”

To cap it all, limiting Europe to an unsophisticated target would result “in lower GDP and employment.” Nonetheless the heads of Government chose to ignore all the evidence. They wilfully chose to forego the potential extra 3m construction and manufacturing sector jobs. They are ensuring that net gas imports will be 45 per cent higher than they could have been. This cop-out means that Europe’s consumers will end up paying over €230bn each year to energy companies than they needed to do.

Who was most to blame for the downgrading of energy efficiency by the heads of Government? After all, there were a great number of Governments that had unequivocally stated publicly that they wished to see a legally binding target for energy efficiency. Led by Germany and the Scandinavian countries, there was a big push made also by progressive industry and by the ETUC – albeit as ever opposed by dinosaurs like Business Europe. The incoming President of the European Commission, Jean-Claude Juncker, stressed in his official
European Parliament hearings that a legally binding target of a 30 per cent improvement would be his minimum requirement.

Only two Heads of Government opposed Juncker’s appointment as the head of the European Commission. One of these was the UK. Only two Governments consistently fought against the concept of a binding target for energy efficiency. Even when they knew all about the security, competiveness, employment, health and ecological benefits of delivering assured energy savings, during negotiations the UK government took every opportunity it could to try to block the creation of the necessary consensus.

Only days before the heads of Government meeting, it was submitting official papers striking out any references at all to energy efficiency, whether voluntary or mandatory. At earlier negotiating meetings, its officials were regularly perceived by their peers as arguing that saving energy scarcely ever made any economic sense.

Why did this previous “number one priority” become such a pariah? One can speculate. The New York Times went further. It stated categorically that the reason for such hostility was simply electoral calculation. The majority party in the UK government, the Conservatives, were simply scared that the UK Independence Party would attack them for adopting another
European-inspired target.

I have no direct evidence as to the accuracy of this conclusion. But I do know that, of all the world’s newspapers, the one that most requires its journalists to justify every word before going into print, is the New York Times.

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    Paul Hallinan


    Looks like common sense needs to play a different kind of game to get noticed when it comes to energy efficiency in this country, never mind Europe.

    Clearly the only way to get energy efficiency back onto the table is to become populist and controversial. Lets get Rebekah Brooks to advise on PR and Nigel Farage’s UKip party to adopt the policy , then we might see the debate open up as a matter of popular panic.

    Do Ukip have an energy policy?? OMG they do!
    http://www.ukipmeps.org/uploads/file/energy-policy-2014-f-20-09-2013.pdf but I wish I hadn’t looked, more of a rant than a policy document, so best not hold your breath.


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