A cure for Europe’s addiction to Russian energy

April 11, 2022 09:21
Photo: Reuters

Russia’s shocking invasion of Ukraine has awakened the European Union to the urgent need to reduce its reliance on Russian fossil fuels. But, as the EU attempts to escape the Russian energy yoke, it must not overlook the critical importance of energy efficiency.

The EU is the single largest customer for Russia’s natural gas and petroleum products. Russia accounts for around 40% of the EU’s gas imports and about a quarter of its oil imports, but only now has it become starkly apparent just how vulnerable this has left us. That is why, soon after the invasion, the EU announced plans to cut its dependence on Russian hydrocarbons by two-thirds this year and end its reliance entirely “well before” 2030.

Greater energy efficiency – achieved through such basic investments as double-pane windows, modern thermostats, and building insulation – could go a long way toward enabling the EU to achieve these goals. According to the European Commission, when energy efficiency is increased by just 1%, gas imports decline by 2.6%. In other words, Europe can take a major geopolitical and environmental step forward simply by wasting less energy.

In the past, the efficiency imperative has often been overshadowed in EU energy-policy discussions by the goal of increasing the share of renewable sources such as wind, solar, and hydro in the energy mix. But these objectives are two sides of the same coin.

Fortunately, the EU’s broad package of draft climate legislation – which aims to reduce the bloc’s greenhouse-gas emissions by at least 55% compared to 1990 levels by 2030, up from the 40% target currently agreed – recognizes this complementarity. Beyond measures to boost the use of renewables, the “Fit for 55” package includes a proposal to increase the EU’s energy-efficiency target for 2030 from 32.5% of final consumption to 36%. (This target is based on 2007 projections for overall EU energy consumption in 2030.) To give the effort more teeth, the Commission wants to make its targets legally binding.

While the package was put forward by the European Commission last July, Russia’s war in Ukraine has made its implementation all the more important. But the European Parliament and EU governments must also go further, agreeing to an even more ambitious target. As the European Parliament member responsible for steering the draft energy-efficiency law through the assembly in the coming months, I will push for a binding EU energy-efficiency target of 43% of final consumption by 2030.

I also recommend introducing binding national targets to underpin the EU-wide goal, and adjusting interim national milestones in 2025 and 2027, to ensure that the trajectory to 2030 remains credible. Moreover, we should broaden an obligation to retrofit 3% of public buildings annually to include social housing. And we must strengthen provisions to improve energy efficiency in low-income households. Greater efficiency would help to shield households from energy-price increases – such as those that began last year in Europe as a result of a gas-market squeeze – and keep heating bills affordable.

Member states’ governments may well balk at the prospect of the EU introducing more stringent – and binding – requirements for national energy savings. After all, in 2018, when the current energy-efficiency target for 2030 was agreed, member states insisted that it be non-binding. But it is worth noting that member states combined are not on track to meet even this goal.

The EU can no longer afford to neglect energy efficiency. Aside from advancing Europe’s geopolitical and climate goals, greater efficiency would bring significant economic and social benefits.

Efficiency-boosting building renovations promise to create many skilled jobs and stimulate economic activity in cities and elsewhere. Thanks to the unprecedented funds the EU raised to overcome the pandemic-induced slump in 2020, member countries are in a strong position to kick-start a Europe-wide renovation wave.

In light of the wide-ranging benefits of boosting energy efficiency, national leaders must show greater political commitment to the EU framework. National sensitivities about the freedom to act have long impeded EU-wide ambition. But, in addressing major crises, from the COVID-19 pandemic to the Ukraine war, the EU has dispensed with other, even bigger, political taboos. Given this recent history, scaling up the EU’s draft energy-efficiency legislation should be as politically feasible as it is strategically sensible.

Copyright: Project Syndicate
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Danish member of the European Parliament and the Progressive Alliance of Socialists and Democrat