Improving energy efficiency can bring multiple economic, social and environmental benefits and is widely viewed as one of the most effective ways to accelerate progress towards the objectives of the 2030 Agenda for Sustainable Development and the Paris Agreement. Investments in energy efficiency are increasing globally and have reached over USD 231 billion in 2016, constituting 12 percent of total energy investments. However, much of the potential for energy efficiency improvement remains untapped, and many opportunities for win-win energy efficiency projects are being lost.
The Intensive Learning Session Overcoming Barriers to Investing in Energy Efficiency at the 2018 Energy Efficiency Global Forum in Copenhagen on 21 May looked into barriers to investing in energy efficiency and ways to overcome them. UNECE organized the session jointly with the Copenhagen Centre on Energy Efficiency and Institute for Energy Efficiency in Production (EEP). The session was held in the UN City (pictured), which is one of the most energy efficient buildings in the world, certified as LEED Platinum.
UNECE’s Oleg Dzioubinski presented findings from the joint UNECE/Copenhagen Centre on Energy Efficiency publication on the topic, which provided insights on the challenges and solutions for increasing the flow of investments into energy efficiency measures and projects. While challenges are often different in many countries and regions, overall the financial environment is not conducive to financing energy efficiency projects and the actual implementation is well below its potential throughout the UNECE region and globally. Stefan Buettner from EEP talked specifically about the role of increasing investments in industrial energy efficiency, which is central for the transition to a low-carbon economy, and what approaches Germany and some other countries of the European Union are applying. Ksenia Petrichenko of the Copenhagen Centre on Energy Efficiency highlighted how the bundling of municipal energy efficiency projects can offer an optimal way to attract investments for energy efficient retrofits of residential and municipal buildings with the possible application of this approach in municipalities in Argentina, Armenia, Belarus, and Georgia.
The panelists from Armenia, France, Georgia, the former Yugoslav Republic of Macedonia, Energy Efficiency Services Limited (an ESCO company in India), and Philips Lighting agreed that raising awareness of the multiple benefits of energy efficiency can be considered as one of the most important sources of increased investments. The importance of not just having a regulatory framework but making sure that it is enforced and complied with was stressed.
Tax incentives for implementing energy efficiency measures and government guarantees for the energy efficiency targeted loans are among the most effective tools for attracting investments. Measurement and verification of savings from energy efficiency improvements are crucial for energy service providers, such as ESCO. The exchanges underscored that human behavior and psychology needs to be taken into account and influenced so that projected savings can actually be achieved. The fact that your neighbor is implementing energy efficiency measures may be more important than if they help you save money or are good for the environment. Energy efficiency is not equal to energy saving. It often brings improvements in quality of life, which are not taken into account when considering only financial factors. The need to open markets and being inventive is particularly important for small countries. Bringing the lifetime savings forward could help in particular to solve the problem of insufficient financing.