Global Economics

EU Puts Forth Bold Energy-Saving Scheme


The EU's energy efficiency action plan is more realistic than related ideas on single market reform and a common energy foreign policy, experts say, but the real challenge will be selling the pro-green EU model to carbon guzzlers the US and China in future.

Thursday's (19 October) plan proposes 75 measures aimed at slashing energy waste by 20 percent by 2020 in what could cut annual oil imports by 390 million tonnes - twice the oil the EU buys in from Russia - wipe out 780 million tonnes of CO2 emissions and save EU national budgets ??100 billion a year in total.

Targeting buildings, transport and manufacturing, the scheme proposes a series of new directives from 2007 to 2012 that would force car makers to cap CO2 emissions at 120 grammes/km, link national car taxation to vehicle efficiency and harmonise EU25 tax credits for clean technology firms.

The raft of proposed measures - many of which will require member states and MEPs' approval - would also impose mandatory standards on 14 groups of household products ranging from lightbulbs and TVs through boilers and see goods labelled with eco-credential stickers to help change consumer tastes.

"You should go both ways, punish the ones who pollute and give strong incentives to the ones who don't," energy commissioner Andris Piebalgs said, while unveiling the scheme in Brussels. "What you do, is you allow on the market only those products that fulfil minimum energy requirements."

He admitted that member states are likely to oppose the tax harmonisation plans - a red line for national sovereingty in key countries such as the UK - but insisted that "this is not some back door to unify [EU] taxation policy."

Brussels will also have to take on the German car-making lobby and persuade consumers to make a "paradigm shift" in behaviour at a time when most Europeans care more about price than energy-saving and where people - including SUV-driving commission president Jose Barroso - still love big cars.

THE MOST REALISTIC PLAN YET.

But despite the obstacles, some experts say the efficiency plan has more chance of succeeding than the commission's July 2007 target for liberalising the energy single market (Mr Piebalgs himself says the date is unrealistic) or forging a common energy foreign policy, with member states set to clash over Russian energy in Finland on Friday.

"This is a test case of how we can reunite with our citizens, how we can impact their lives in a real way," UK socialist MEP and energy policy rapporteur Eluned Morgan, who backs mandatory targets for cars and other products, stated. "It's the easiest and most cost-effective way to impact European energy policy."

"Twenty percent is realistic if there is political will in the European Parliament and member states," commission 'intelligent energy' expert Patrick Lambert told EUobserver. "It's a target that we've had in our minds for a while because it is achievable. It doesn't require too much investment."

The EU's success or failure in building a greener economy by 2020 has bigger implications outside Europe than inside, Mr Piebalgs and pro-green campaigners say, however, with countries such as the US, Japan, China and Russia looking to see what they can learn from the EU experiment.

BIGGER PICTURE.

The EU, with 500 million consumers and 19 of the world's 30 most developed economies, is the world's biggest energy player, but is a small part of the global warming threat and has no coastline on the environmentally-critical Arctic Ocean zone.

"Energy efficiency must also be a focus of EU external relations policy," Belgian green MEP Claude Turmes said. "In Russia, for example, energy inefficiency in buildings accounts for the same proportion of energy as Russia's total gas exports to the EU."

"It's very important that the experiences that we have are brought to other regions of the world that are more energy intensive," Mr Piebalgs stated.

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