Report: EU wasting money on energy efficiency programs

Michael Bastasch Contributor
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An audit of European Union-backed energy efficiency projects found that funds were wasted, going towards projects where energy efficiency was a “secondary concern” or had a planned payback period of up to 150 years.

“None of the projects we looked at had a needs assessment or even an analysis of the energy savings potential in relation to investments”, said Harald Wögerbauer, the member of the European Court of Auditors who was responsible for the report. “The Member States were essentially using this money to refurbish public buildings while energy efficiency was, at best, a secondary concern.”

The audit looked at 24 energy efficiency projects in the Czech Republic, Italy, and Lithuania — the countries that received the largest amounts of funding for energy efficiency projects between 2007 and 2013.

The audit found that the EU-funded projects selected for financing did not have “rational objectives” in terms of cost-effective energy savings — cost per unit of energy saved — and were not selected on their ability to produce “financial benefits through energy savings.”

The projects were so inefficient that the average planned payback period for the investments was 50 years — half a century — with certain projects having a 150 planned payback period.

“This means that these funds were not spent in a sensible way because the lifetime of the refurbished components or buildings is lower and can, to a large extent, be considered to be lost on the energy efficiency point of view,” reads the audit.

In 18 out of the 24 audited projects, auditors could not verify actual energy savings because they had not been measured in a reliable way.

For more than a decade, the EU has spent nearly 5 billion euros ($6.7 billion) through its Cohesion Policy funds for co-financing energy efficiency projects throughout the EU, which the European Commission and individual member states are responsible for managing.

Reuters reports that the European Commission has also proposed spending more than 17 billion euros for energy efficiency between 2014-2020.

Reuters reports that the EU Commission said the audited programs” were negotiated before the Commission fully developed its energy-efficiency policy.”

“The new Energy Efficiency Directive will require member states to promote the availability of high quality and cost-effective energy audits and energy management systems to all final customers,” said the Commission.

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