INOGATE New ITS Project

Energy efficiency in Lithuania and some other CEE countries

by prof. Vidmantas JankauskasEnergy Regulatory Expert

Tbilisi28 February 2013

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Tajikistan

Uzbekistan

Moldova

Georgia

Armenia

Ukraine

Azerbaijan

Kazakhstan

Belarus

Turkey

Russia

Poland

Latvia

Lithuania

Hungary

Estonia

Italy

Germany

Finland

Denmark

Netherlands

Sweden

GDP (PPP)/cap

TP

ES

/cap

Relation between energy consumption and GDP

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Energy intensity of economy (PPP)

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Tajikistan

Uzbekistan

Moldova

GeorgiaArmenia

Ukraine

Azerbaijan

Kazakhstan

Belarus

Turkey

Russia

Poland

Latvia

Lithuania

Hungary

Estonia

ItalyGermany

Finland

Denmark Netherlands

Sweden

GDP (PPP)/cap

TP

ES

/GD

P (

PP

P)

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Electricity consumption and GDP

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TajikistanUzbekistan

MoldovaGeorgia

Armenia

Ukraine

Azerbaijan

Kazakhstan

Belarus

Turkey

Russia

Poland

Latvia

LithuaniaHungary

Estonia

Italy

Germany

Finland

DenmarkNetherlands

Sweden

GDP (PPP)/cap

El/cap

4

Energy intensity in EU Member States in 2007

Eurostat, 2011

Lithuania

Latvia

5

Primary energy intensity in 2010

0 0.2 0.4 0.6 0.8 1

Germany

France

EU-27

Portugal

Finland

Slovenia

Lithuania

Latvia

Poland

Hungary

Slovakia

Romania

Bulgaria

kgoe/€

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Fuel poverty

7

8

Annual progress in energy efficiency in industry

Source: Lapillone and Pollier 2007

Fuel poverty is caused by a convergence of four factors

• Low income, which is often linked to absolute poverty

• High fuel prices, including the use of relatively expensive fuel sources

• Poor energy efficiency of a home, e.g. through low levels of insulation and old or inefficient heating systems

• Under-occupancy: some old people in fuel poverty live in larger than average homes or flats

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Estimated potential for GHG mitigation in 2030 in different cost categories , transition economies

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Buidlings Industry Agriculture Energy supply Forestry Waste Transport

Gton CO2eq.

<20 <0 0-20 20-100

Cost categories* (US$/tCO2eq)

* For the buildings, forestry, waste and transport sectors, the potential is split into three cost categories: at net negative costs, at 0-20

US$/tCO2, and 20-100 US$/tCO2. For the industrial, forestry, and energy suppy sectors, the potential is split into two categories: at costs

below 20 US$/tCO2 and at 20-100 US$/tCO2.

Source: CEU research for IPCC

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Why it is difficult to harvest the potentials

• While cost-effective, long payback times

• Substantial capital investment needs

– But very limited liquidity of population and institutions

• Perverse governmrnt’s incentives (e.g. procurement, support schemes)

• Millions of stakeholders to be mobilised

• Huge transaction costs

• Markets, businesses, experts and public awareness not ready

• others11

Co-benefits of improved energy efficiency in CEE buildings

• Employment creation– “producing” energy through energy efficiency or renewables is

more employment intensive than through traditional ways

– a 20% reduction in EU energy consumption by 2020 can potentially create 1 mln new jobs in Europe

• new business opportunities– for developed countries a market opportunity of € 5–10 billion

in energy service markets in Europe

• Increased comfort– noise reduction, reduction in indoor pollution –> reduced need

for cleaning and improved health; property values increased

• Reduced energy costs will make businesses more competitive

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Poland: development of energy intensity

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0,9

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

kg

oe

/eu

ro0

0

Intensity of primary energy Climate corrected Intensity of final energy Climate corrected

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Poland: legislation in energy efficiency

• Law on energy (1997)

• Law on thermal modernisation (1998)

• Law on thermal modernisation and maintenance (2008)

• Law on energy efficiency (2011)

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Poland: National energy efficiency action plans (NEEAP)

• NEEAP1 (2007)

– National energy efficiency targets

– Exemplary role of the public sector

• NEEAP2 (2011)

– System of white certificates

– System of monitoring of the efficiency results

– Energy Efficiency Fund

– Training auditors for industry

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Poland: white certificates system

• white certificates are tradable and combined with an obligation to achieve a certain target of energy savings

• covers large scale interventions in EE by energy producers greater than 5 MW and final energy consumers who use more than 400 GWh/year

• projects can include industry installations, the modernisation of buildings, the modernisation of industrial installations, heat grids and plants and other

• for the period 2010-2016, the saving of 1.84 Mtoe of energy would cost EUR 9.05 billion

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Poland: Thermal & Refurbishment Fund

• The Law on supporting thermal performance improvement projects – 1998• The Law on supporting thermal performance improvement projects and refurbishment –2008/2010.• Ministry’s of Infrastructure Ordinance on the scope and form of the energy effectiveness audit, thermal and refurbishment subsidies, and thermal undertakings effectiveness calculation -2009• Ministry’s of Infrastructure Ordinance on verification of the energy efficiency audit, verification entity requirements - 2009

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Poland: thermal modernisation process

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Poland: results for thermal modernisation of buildings until 2010

• Number of applications:• 16 977

• 15753 successfully approved

• On average:• energy savings: 45%

• cost of modernisation: 22 Euro/m2

• cost of reduction of 1GJ: 50 Euro/GJ

Source: KAPE (National Energy Conservation Agency)19

Lithuania: growth rates in 2000-2009

-8

-6

-4

-2

0

2

4

6

8

GDP Electricity Energy Heat(district)

Heat losses

%

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Lithuania: energy consumption and saving potential

0

10

20

30

40

50

60

Total Residentialbuildings

Publicbuildings

Industry Transport

use savings

TWh

Source: Energy Agency21

Lithuania: energy saving potential

Multifamily houses

24%

Cottages 17%

Public buildings

20%

Services8%

Industry23%

Transport7%

Agriculture1%

Source: Energy Agency22

Lithuania: Energy saving plan for 2008-2016

0,5 1,0

1,5

3,1

4,7

6,3

7,8

9,4

11,0

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0

40

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120

160

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2008 2009 2010 2011 2012 2013 2014 2015 2016

Ene

rgijo

s ta

up

ymo

ro

dik

lis,

%

Suta

up

ytas

en

erg

ijos

kie

kis,

ktn

e

Source: Energy Agency

ktoe

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Obvious conclusion

• Renovating the buildings of Lithuania is a safe, sure way of increasing energy security, improving quality of life and substantially boosting the economy

www.euractiv.com/energy

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Lithuania: heat energy consumption in buildings

0

50

100

150

200

250

kWh/m2

New5%

Efficient17%

In-efficient

56%

Very bad22%

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Requirements for the new buildings in Lithuania

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Renovation (thermal modernisation) scheme

0

20

40

60

80

100

120

140

160

180

200

Before After

savings

investmentrepayment

heating

kWh/m2

27

Thank you for your attention

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