Stimulating Consumer Demand for Energy Efficiency Investments

Stimulating Consumer Demand for Energy Efficiency Investments

The European Green Deal calls for an ambitious approach to both developing an appropriate policy foundation and effective implementation for energy efficiency. The policy framework is currently being revised and only recently the revisions to the Energy Efficiency Directive – the centrepiece to the legislative foundation – was approved.

With the policy framework is now in quite good shape the focus has to be on implementation in order to meet 2030 and 2050 climate and energy objectives. This means stimulating consumer demand because it all starts with the consumer in all sectors.

The Energy Efficiency Financial Institutions Group (EEFIG), an initiative established in 2013 as a specialist expert working group by the European Commission and United Nations Environment Programme Finance, will soon publish its final report from an expert working group on accelerating consumer demand. Rod Janssen, President of EEIP, was co-lead of the working group.

The objectives of the consumer demand WG were to identify and assess the main barriers and drivers to stimulate demands for EE investments from consumers and final users, identify best practices, and formulate general and specific recommendations on what tools and policy instruments are likely to be most effective in increasing consumers and final users demand for EE investments.

The members of the WG were financial institutions, EU funded projects within demand activation and EE financing, public energy agencies, housing associations, technology providers and industry associations, research institution and consultancy, as well as the European Commission.

The report provides important messages and insights. Importantly, from the evidence provided, the EU really can accelerate consumer demand in a timely manner. and, Addressing the barriers to scaling up demand for energy efficiency investments requires parallel action by several groups of stakeholders, including sector stakeholders (including in the builder sector and enterprises in the supply chain), national and local governments, EU institutions, as well as public and private financial institutions. Thus, there is need for constant dialogue and networking to ensure everyone is working together.

There are important recommendations from the working group to the targeted audiences:

• Sector stakeholders including builders and enterprises in the supply chain, should facilitate consumer uptake of energy efficiency solutions through clear and trustworthy information, attractive renovation value propositions, simplified costumer journeys, and cooperation with governments and financial institutions;
• Member States should facilitate the necessary framework conditions for consumers demand and uptake of energy efficiency solutions;
• EU institutions should continue to lead the establishment of a policy framework supporting demand activation for energy efficiency investments and facilitate replication of best practice examples outside of the geography where they are originated; and
• Financial institutions should develop dedicated energy efficiency financing instruments, engage with national governments on blending of public guarantees and private funding for energy efficiency, embed Energy Efficiency EE1st principles in financing procedures.

What is next 

Once the report is published, it will be important to create a dialogue with all the stakeholders so that they understand that there are good solutions to accelerate consumer demand. We know what to do and have many excellent examples in the report. But driving consumer demand will now require commitment by all stakeholders in order to give priority to implementation, implementation and more implementation.