Savings will slash prices
Energy efficiency measures can lead to significantly lower energy prices, according to a recent study commissioned by Climate Action Network and Friends of the Earth Europe. Every €1 saved on not using energy means there is another €1 that will be saved due to lower prices for energy.
Demand for expensive marginal electricity generated to cover peak hours will decrease. A general lower demand for fossil raw materials will also be reflected in prices, especially for gas sold on the regional market, but also to some extent for oil on the world market.
Energy efficiency will also mean a reduced need to invest in new energy infrastructure. According to the International Energy Agency, the EU needs to invest €130 billion a year in infrastructure between 2010 and 2035 with current policy. If the 20 per cent target is achieved by 2020, the authors of the report expect that the need for investments will be about 25 per cent lower, thereby saving energy companies around €30 billion a year. With the right regulatory framework these savings should be reflected in lower prices for end users.
Dora Petroula, energy savings policy officer for Climate Action Network Europe, links these findings with the situation for the European economy:
“Energy savings are a win/win solution to Europe’s economic recovery, creating jobs while reducing greenhouse gas emissions. A binding energy savings target for 2030 would encourage long-term investment past 2020, the European Commission and national governments need to make it happen.”