Tougher energy efficiency target would boost UK economy by £62bn – study

A 40% cut in energy use by 2030 through efficiency measures would increase the UK’s GDP by £62bn and create 40,000 new jobs, according to unpublished EU figures.

Hitting a lower target of 30% would create 13,000 jobs and boost the economy by £17.3bn, says the study by independent consultancy Cambridge Econometrics, obtained by WWF after an access to information request.

The study underlines the impact of engineering the economy to use less energy. “The benefits of energy efficiency are impressive and we need to be ambitious,” said Brook Riley, a spokesman for Friends of the Earth. “GDP gains are three times higher with a 40% reduction target than with 30%. It is significant that the countries which were hardest hit by the financial crisis – Greece, Portugal, Ireland – are among the strongest advocates of going as far as we can.”

EU energy and environment ministers are gathering in Milan to discuss energy efficiency targets as part of a broader package of climate and energy goals for 2030 that currently includes boosting renewables to a 27% share of the market and cutting greenhouse gas emissions by 40%.

A potentially binding 30% efficiency target has been pencilled in, which Germany and Denmark would like to see raised. The 30% number is opposed by the UK and Poland, however, on grounds of cost and states’ freedom to choose their own energy policy.

The bloc is already committed to a 20% market share for renewables and 20% emissions cut by 2020 – both measured against 1990 levels – and a 20% improvement in energy efficiency, against a 2005 projection.

But environmentalists argue that the relatively less ambitious targets for 2030 will make Europe’s goal of 80-95% decarbonisation by 2050 more difficult to reach, especially as the CO2 cut is the only one that would currently be binding on EU states. In that context, energy efficiency targets are seen as a bellwether issue.

The new figures were one part of a detailed European commission costs and benefit assessment for energy saving measures, which never saw the light of day. Environmentalists claim it was suppressed by the EU secretary general’s office to appease conservative European states and energy intensive industries that view efficiency as an expensive luxury.

In one draft version of an emailed communication seen by the Guardian, the secretary general’s office added a passage to the EU energy department’s preferred text which read: “There are risks in promoting too ambitious a target for energy efficiency because costs increase faster than the benefits. More specifically, the additional fossil fuel import savings of an energy efficiency target of going beyond 28% are smaller than the associated costs.”

This remains the UK’s position, although the EU hierarchy has since moved to support a 30% objective, after an intervention by Jean-Claude Juncker, the new president of the European commission.

Arthur Neslen

This article first appeared in the Guardian

edie is part of the Guardian Environment Network