Structural reforms needed to close the EU’s investment gap

New research by Ecofys reports that the total public funding for energy efficiency in the EU grew from about €6 billion in 2012 - when the Energy Efficiency Directive (2012/27/EU) was approved, to about €7.1 billion in 2014. This trend, which can also be observed in Central and Eastern Europe, is encouraging, but a lot still needs to be done to break down barriers to energy efficiency investments.

As the European Parliament is discussing the first results of the Investment Plan for Europe, a new study by Ecofys “Public funding for energy efficiency in the EU” reports that Member States are increasing funding for energy efficiency. The study shows that the trend can also be observed in some countries in Central and Eastern Europe. Slovakia, for example, has the highest level of funding per capita across the Member States monitored. Nevertheless, many investments which would make economic sense are still not realised, and a lot needs to be done to ensure that the legislative framework encourages these opportunities.

The increase in public funding for energy efficiency in the EU is encouraging, but it is only one element of what is needed to trigger real investments”, said Stefan Scheuer, Secretary General of The Coalition for Energy Savings. “Member States and the European Commission’s financial efforts to support energy efficiency will not lead to major market uptakes unless they are accompanied by significant structural reforms, including in the areas of public deficit accounting and state aid, and by high ambition for 2030”.

The European Commission has indicated its willingness to break down barriers to investments with its Investment Plan for Europe. The Coalition for Energy Savings calls on the European Commission to place energy efficiency first in reviewing policies such as state aid and public accounting rules.