ECA: The EU’s contribution to energy efficiency in business is unclear

In a special report published today, the European Court of Auditors (ECA) called for clarification on how EU funds contribute to energy efficiency for businesses. The auditors conclude that EU funding is not yet sufficiently linked to business needs. As for its expected results, although it is not possible to capture them under the current monitoring framework, their potential to contribute to the EU’s energy efficiency targets is, at best, limited. Among other things, the auditors found evidence that a number of projects might have been successfully implemented without public support.

Energy efficiency is an important component of the EU’s ambitious goal of achieving a neutral carbon balance by 2050. However, significant efforts still need to be made, and the role of business is also important in this regard. In this context, in parallel with the measures taken by the Member States themselves, between 2014 and 2020 the EU allocated significant amounts of money to finance energy efficiency improvements for businesses.

The auditors point out that the amount of planned EU resources in the field of cohesion policy has decreased in recent years, from a total of € 3.2 billion in 2016 to € 2.4 billion in 2020. In addition, most expenditure was concentrated in only a few Member States. . Only five of them (Czech Republic, Poland, Germany, Italy and Bulgaria) account for about two thirds of the resources allocated to energy efficiency costs to businesses.

“Improving the energy efficiency of companies, regardless of the sector in which they operate, contributes significantly to the EU achieving its emission reduction target of at least 55% by 2030,” said Samo Jereb, Member of the European Court of Auditors and responsible for the report. “So far, however, the real impact of EU funding on business energy efficiency remains unclear.”

The report calls into question the real added value of EU funding. It is clear that EU grants play a role in an investment decision by a company. In most cases, however, investments that received EU funding were already planned. In other words, many projects would have started to be implemented even without this support. Even without public support, investments in energy efficiency are generally cost-effective, the auditors note. It is estimated that saving a unit of energy is cheaper than spending on the corresponding amount of electricity, which is the most widely used energy source. The correctness of this statement is proven even more clearly by the recent rise in energy prices.

The overall contribution of EU funding is difficult to determine. The auditors point out that it is not possible to evaluate performance at EU level: national authorities do have indicators, which, however, differ between Member States and sometimes between programs in the same Member State.

In the absence of consolidated information at EU level, the auditors carried out their own calculations. They estimate that the potential energy savings achieved as part of the co-financed business projects contribute around 0.3% to the efforts to achieve the EU energy efficiency targets by 2030. In other words, the contribution of EU-funded energy efficiency projects to EU targets will be, at best, limited.

General information

The Energy Efficiency Directive is the basic legal act in the field of energy efficiency. Under this directive, Member States are required to implement measures to achieve national energy efficiency targets, thus helping to achieve EU energy targets. In national energy efficiency action plans, Member States Member States shall identify measures to increase efficiency in the field of energy supply, transmission and distribution, as well as measures applicable to end-users.

Special Report 2/2022, entitled “Partial energy savings but weaknesses in the design and selection process”, is available on the ECA website (eca.europa.eu).

In 2020, the ECA published a report on EU energy efficiency investments in residential buildings, as well as a report on EU action in the field of eco-design and energy labeling.

The ECA presents its special reports to the European Parliament and the Council of the EU, as well as to other stakeholders, such as national parliaments, industry and civil society representatives. The vast majority of them, the recommendations made in his reports are implemented.