1. At Interface we strongly support the idea of promoting energy efficiency. At our European division we have been able to cut our carbon emissions by 90% since 1994 and we continue to drive them down. Improvements in energy efficiency have been responsible for 60% of these cuts, with the remaining 30% coming from converting to green electricity and, more recently, to biogas.
2. Our experience is that improving energy efficiency is the most effective, easiest and cheapest option available to businesses and governments that wish to reduce their carbon emissions. If, for instance, we had managed to achieve 60% of our carbon emissions since 1994 by converting to renewable energy, then that would have been much more expensive.
3. Interface has been supportive of the European Union’s climate and energy efficiency package, and we are pleased that the EU is now looking at putting more effort into promoting energy efficiency across the continent. But we believe the time is right for a more radical approach. Just setting modest targets will not deliver the rapid change that we need. Instead the EU must come up with a proper energy efficiency package supported by updates of several relevant directives.
4. We think the most effective way of encouraging energy efficiency improvements is through regulation that concentrates on the product level. A great example of this has been the EU’s work with the car industry, where it has defined a performance metric on tailpipe emissions (gCO2/km) for manufacturers, set out an average target for companies to meet (90gCO2/km by 2020) and introduced regulation that forces the publication of that metric in advertising and at point of sale. These measures have been supported by national and local governments, which have introduced tax breaks and penalties that have reinforced the drive towards lower carbon cars.
5. We need a similar roadmap for other industry areas. If we take buildings, for instance, the EU could pick two performance metrics: kWh/m2 for energy in use and kgCO2 for embodied carbon in new construction. It could then introduce strong European targets for new buildings, mandate all public and company buildings to show their energy efficiency levels and, at national level, encourage governments to link energy efficiency performance with stamp duty and with local council taxes.
6. If we want to make real progress on energy efficiency the EU needs to adopt a similar approach sector by sector, preparing a battery of actions for each sector at product performance level. It needs to regulate energy when it is consumed, not when is generated.
7. The EU has been also successful in implementing performance standards and labels for energy using products such as fridges and washing machines. But it’s time to get much more radical and get those companies to compete much more fiercely in obtaining the lowest energy consumption. Let’s find a way to reward those companies who will come with the best innovations instead of having a minimum common denominator approach. We also need to expand that approach to more energy using products.
8. Some argue that the EU should be wary of improving energy efficiency across the board because this will distort the Emissions Trading Scheme (ETS), but we reject that analysis. The ETS does not in any case deliver a proper price for carbon. We cannot put off action any longer due to fears that such action will damage an already broken system. The primary goal for EU climate policy must be an aggressive pursuit of energy efficiency. Once that has been undertaken, we can adjust the rest of climate policy to accommodate the primary goal of decoupling Europe from energy consumption.
9. It is also a fallacy to say that pursuing better energy efficiency costs too much. European Commission research has shown that across Europe we can achieve a 2.6% reduction in imported gas for every 1% increase in energy efficiency. According to the European Alliance to Save Energy, if all computers were switched off when not in use, that would save 360m euros per year in the UK and Germany alone, and if every company PC in Germany was fitted with energy saving software, the national economy there would be 1.9bn euros better off.
10. The product thinking used for cars or energy using products can be equally effective on products with high embodied energy. A building can be design to have radically less embodied energy by using different raw materials or by designing in a smarter way. That applies for a sofa, a diet, a plastic bag, a toy, a chemical, carpet or cement. The first step is mandating product transparency through either EPDs (Environmental Product Declarations) or developing magic metrics for each product category.
11. If there was an EU regulatory regime that rewarded companies for redesigning their products to save embodied energy, then the gains could be even more impressive. For example, for a little more cost Interface can design a carpet with 50% less embodied energy, saving a huge amount of energy in the supply chain. But there is no financial incentive to do so. If, however, a carpet with 5kgCO2/m2 was subject to lower VAT than a carpet with 20kgCO2/m2, then we would have an incentive to convince more customers to buy those products., instead of just appealing to a good cause. The same would apply for all kinds of physical products, from plasterboard to plastics. The only way to incentivise product design is through the same battery of policy initiatives that were targeted at the car industry.
12. In summary, huge and relatively cheap gains on energy efficiency can be made across industry by focusing regulation on product design. What we need are directives allied to performance metrics across all sectors, an average target for companies to meet, further regulation that forces the publication of those metrics, and the support of national and local government tax policies to reinforce these measures. If we move down this path, then dramatic change can be achieved. Carrying on with the current mindset, where only general EU-wide headline grabbing targets are set with little regulatory back-up, will deliver too little, too late. We urge the EU to take this unique chance that we have to move in a new direction as soon as possible, given that both energy security and climate change are back in the headlines for a period of time.
Let’s take this opportunity in front of us right now.