Finance & EconomicsImpact and nature of the declaration on Energy Efficiency Financing
Résumé
The declaration serves as a political commitment within the European Energy Efficiency Financing Coalition, emphasizing the crucial role of energy efficiency in the EU's decarbonization efforts by 2050. It recognizes energy efficiency as an established, cost-effective approach to lowering emissions and supporting the clean energy transition, including meeting increased energy efficiency targets and a binding renewable energy target set by EU directives. Significant investment, primarily from private sources, is needed to achieve these goals and honor the Paris Agreement's aspiration to keep global warming below 1.5 degrees Celsius.
The declaration aligns with the EU Green Deal and the REPowerEU plan to reduce reliance on Russian fossil fuels, promoting a clean, equitable, and inclusive shift toward climate neutrality. It also accentuates energy efficiency's role in bolstering economic resilience, ensuring energy affordability, and upholding competitiveness. Recognizing energy efficiency's broad benefits, it calls for enhanced EU-wide cooperation among financial institutions and policymakers to mobilize private financing for these initiatives.
Signatories pledge to support the European Energy Efficiency Financing Coalition's activities, aiming to create an enabling environment for energy efficiency investments, supported by public awareness and skill development programs. Although the declaration does not establish new legal or financial commitments, it represents a consensus on advancing energy efficiency financing strategies in the EU.
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Impact and nature of the declaration on Energy Efficiency Financing
The declaration is a political declaration on energy efficiency financing and part of the European Energy Efficiency Financing Coalition. It underscores energy efficiency's critical role in decarbonizing the European Union (EU) by 2050.
The declaration acknowledges energy efficiency as a mature, cost-effective solution and the most economical way to reduce emissions, foster the clean energy transition, and reduce energy needs, referencing Directive (EU) 2023/1791, which increases the EU's energy efficiency target to at least 11.7% by 2030, and Directive (EU) 2018/2001, which sets a binding renewable energy target of 42.5% by 2030, aspiring to reach 45%.
It notes the need for significant investment, predominantly from private funding, to meet these targets and the commitments of the Paris Agreement to limit global warming to 1.5 degrees Celsius.
The declaration highlights the importance of energy efficiency in achieving the EU's greenhouse gas reduction targets. It supports the EU Green Deal and the REPowerEU objectives, aiming to end external dependence on Russian fossil fuels and facilitate a clean, just, and inclusive transition to climate neutrality. It also emphasizes that energy efficiency and renewable energy efforts support economic resilience, access to energy, competitiveness, and prosperity, ensuring energy affordability, reliability, and sustainability.
The declaration also acknowledges the Green Deal Industrial Plan, which considers energy efficiency vital for preserving and enhancing EU competitiveness, giving EU industries a comparative advantage internationally. It acknowledges the multiple benefits of energy efficiency, including promoting economic and social development, reducing emissions, creating jobs, and improving health and well-being.
The declaration recognizes the significant total investment required for the energy transition and the necessity for this investment to come largely from private sources. It recalls European Council conclusions from 2022, emphasizing the need to increase investments in energy efficiency. It proposes an EU-wide initiative to strengthen cooperation between financial institutions and policymakers to mobilize private financing for energy efficiency.
The signatories of the declaration commit to enhancing efforts to establish a long-term viable funding framework for energy efficiency investments. They express intent to support the launch and engage in the activities of the European Energy Efficiency Financing Coalition. This involves
- actively participating in defining and implementing the Coalition's work programs,
- cooperating in its governance, and
- aggregating stakeholders under Coalition National Hubs.
It details commitments to creating conditions to facilitate energy efficiency investments and promote the use of public funds to leverage private investments. It discusses facilitating an environment conducive to deploying energy efficiency and savings measures through advisory services, project development assistance, one-stop-shops, skill development, training, and public awareness campaigns.
The signatories highlight the public sector's role in leading by example in energy efficiency, exploring the adoption and implementation of directives related to public activities and buildings. Finally, the paper clarifies the political nature of the declaration, stating it does not create new legal commitments or financial obligations but records a political intent to guide future actions and strategies related to energy efficiency financing within the EU.
