The EU's energy intensity decreased between 1990 and 2012 while renewables increased strongly. Latest data confirm that the EU is on track towards its 2020 energy targets: increasing renewables to 20% of energy use and reducing primary energy consumption by 20% at EU-level.
The EU has adopted two new energy targets: increasing renewables to minimum 27% of EU energy use and improving energy efficiency by a minimum of 27% by 2030. Further efforts beyond currently implemented policies are needed to keep the EU on track towards the objective of decarbonising the European energy system by 2050.
Since the Industrial Revolution, the global economy has depended on unrestricted access to cheap energy resources, primarily from fossil fuels (see SOER 2015 briefing on resource efficiency). However, a number of factors look set to change this relationship in the coming decades:
- The OECD predicts rapid global economic expansion between now and 2050. This could intensify energy use and exacerbate global competition for energy resources, thereby increasing Europe's exposure to geopolitical risks and fossil-fuel price spikes.
- The way we produce and consume energy has severe impacts on our climate (through greenhouse gas emissions from burning fossil fuels); on air quality (from fossil fuel and biomass combustion); on water quality and quantity (through dam construction for hydropower, water retention for energy crops, or water use for cooling of power plants); and on land resources, including natural habitats and ecosystems (through further deforestation in the tropics for the production of bioenergy, and through fragmentation of habitats due to resource extraction, pipelines and grids). If we do not change our habits, the consequences could be irreversible.
- Technological innovation could either alleviate or exacerbate some of these pressures. In the case of energy efficiency and renewable energy, it could alleviate pressures by decoupling energy consumption from economic growth and by prompting a shift towards less-polluting alternatives. But technological innovation could also weaken the momentum behind global climate-change mitigation efforts by boosting access to polluting fossil resources, and it could exacerbate the pressure on ecosystems through unsustainable demand for water and land use. And by making energy cheaper, innovation may encourage greater energy use, undoing many efficiency gains through the so-called 'rebound effect'.
These concerns suggest we need to fundamentally rethink our energy systems. In order to address these issues, the EU has committed to the '20-20-20' objectives. By 2020, it aims to cut greenhouse gas (GHG) emissions by 20% compared to 1990 levels, increase the share of renewable energy to 20% of energy consumed, and achieve a 20% cut in primary energy use compared with projected levels. A range of approaches to make energy-production and consumption patterns more sustainable have also been enshrined in other EU policies, and have been gradually tightened over the years. These policies include the Industrial Emissions Directive, the Clean Air Policy Package, environmental legislation on water and biodiversity (including Natura 2000), the Ecodesign Directive, the Energy Performance of Buildings Directive, and the Energy Labelling Directive.
Decoupling and Europe's energy intensity
Between 1990 and 2012, there was a decoupling of economic growth from energy consumption in the EU-28 (see definition section on energy intensity). This positive evolution occurred in the context of the economic recession; efficiency gains in the power sector; efficiency gains by end-consumers; the rapid penetration of renewable energy sources; and a shift from energy-intensive industries towards services with a higher value added.
Facilitated by European climate and energy policies, the EU's energy intensity decreased by 1.7% per year between 1990 and 2012 (Figure 1). In the same period, the renewables more than doubled their share of energy production (Figure 2); and there was a switch towards fuels that were less GHG-intensive (Figure 3).
Figure 1: Trends in energy intensity, gross domestic product and gross inland energy consumption
Renewables and nuclear
In 2012, the share of renewable energy consumed in Europe reached 11%, compared to 4.3% in 1990. Biomass energy and hydropower accounted for the largest share of renewables throughout the period, even though technologies such as solar photovoltaics (PV), solar thermal, and wind power had the highest average growth rates since 2005 (Figure 2).
The consumption of nuclear energy in the EU-28 peaked in absolute terms in 2004 (260 Mtoe). From 2005 to 2012, consumption of nuclear energy in Europe fell by 12% due to the shutdown of reactors that had reached the end of their planned lifetime, and the decision of Germany to begin to withdraw from nuclear power in the wake of the Fukushima disaster. Nevertheless, nuclear energy consumption in 2012 was still 11% higher than in 1990.
Figure 2: Contribution of renewable energy sources to gross inland energy consumption
Continued reliance on fossil fuels
In absolute terms, fossil fuel consumption in the EU decreased by 9% from 1990 to 2012. The largest absolute reductions took place for coal (–35%) and oil (–10%), while natural gas consumption went up considerably over the period (+32%), offsetting partially the decline in the use of the other two fossil fuels (Figure 2). The coal-to-gas switching was driven by several factors, including tighter health and environmental regulations, consistently falling gas prices in the 1990s, and the attractiveness of combined-cycle gas plants.
For oil, the observed decline mainly took place after 2005, due to a combination of increased use of biofuels in transport, high oil prices, and the economic downturn. Despite the continued decline in the use of fossil fuels in recent decades, in 2012 fossil fuels still accounted for three quarters of all energy consumed in Europe. This gives rise to considerable health, environmental and geopolitical concerns.
Figure 3: Gross inland energy consumption by fuel
Thanks to significant progress in the climate and energy areas the EU will meet its 20-20-20 commitments for GHG emissions and renewables, although it may just fall short of its commitment to cut energy use by 20% by 2020.
However, there is still significant scope to make further progress after 2020. The EU's 7th Environment Action Programme has a vision for 2050 in which Europeans 'live well within the planet's ecological limits'.
To realise this vision, the European Commission adopted a climate and energy framework to guide policy up to 2030, and EU leaders have endorsed the long-term objective of reducing by 2050 Europe's GHG emissions by 80% to 95% compared to 1990 levels. This will transition Europe to a low-carbon, green economy.
The penetration of new technologies will support this transition through changes in the European energy mix and through efficiency improvements (see SOER 2015 briefing on transport). Unexpected advances in solar technology make it likely that decentralised solar PV will play a greater role in the European energy mix than previously anticipated.
In contrast, other technologies that were once believed to be promising now look less attractive. For example, the cost-competitiveness of nuclear power has deteriorated following the tightening of security standards since the Fukushima accident, and there has been a much slower-than-expected roll-out of carbon-capture-and-storage technology.
However, not all technological development will ease pressures on the environment. The recent technological progress in the extraction of unconventional oil and gas could have global implications on fossil-fuel prices and availability, hampering the transition towards a sustainable low-carbon system. This suggests that market forces and technology alone will not deliver the hoped-for energy transformation.
There is therefore a need to ensure that new energy projects are made environment-compatible, so that they preserve or enhance ecosystem services. This will require better integration of environmental objectives into European energy policy. This applies to all the likely energy projects of the future: fossil-fuel extraction and use; renewable energy generation; carbon capture and storage; and advanced power grids.
In addition to these macro-level changes, there is also great potential to change consumer behaviour. The emergence of collaborative consumption and of innovative sharing schemes aided by the internet and communications technology suggests that consumers can play a significant future role in saving energy (see SOER 2015 briefing on consumption).
 The 20% share of renewable energy is measured against gross final energy consumption, as defined in Directive (2009/28/EC) on renewable energy sources. The 20% energy savings target is set against primary energy consumption, defined by the Energy Efficiency Directive (2013/12/EU).
 In the period from 1990 to 2005, this decoupling was relative — overall energy use was still increasing, but a unit of energy in 2005 produced more growth than it did in 1990. From 2005 on, this decoupling became absolute — overall energy use did not increase and even declined even though economic growth continued.
 As measured in gross inland consumption. By contrast, the 20% renewable energy target for 2020 under the Renewable Energy Directive (2009/28/EC) is set against gross final energy consumption; it stood at 14% in 2012 (or 70% of the EU-28 target for 2020).
 The largest reductions in nuclear energy production were observed in Lithuania, Germany, UK and in Sweden. On the other hand, nuclear production increased continuously in recent years in the Czech Republic, Hungary and Romania.
 Combined-cycle gas turbines became more attractive due to a combination of factors, especially their relatively low capital expenditure, higher efficiency and flexibility, and favourable coal-gas price differentials during the early 1990s. From 2010 onwards a shift from natural gas to solid fuels has been observed in the power sector, due to low prices for coal and lignite and also low prices for emission allowances under the EU Emissions Trading Scheme.
 EC (2014), Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions - A policy framework for climate and energy in the period from 2020 to 2030, COM(2014) 15 final, Brussels, 22.1.2014.>
EEA (2014), Trends and projections in Europe 2014, EEA Report No 6/2014, European Environment Agency, Copenhagen, Denmark.
Abbreviations and definitions
- Energy consumption denotes gross inland energy consumption (GIEC) and represents the quantity of energy necessary to satisfy inland consumption of the geographical entity under consideration. Gross inland consumption does not include energy (fuel oil) provided to international maritime bunkers.
- Energy intensity denotes the ratio between energy consumption and GDP. It expresses the extent to which there is a decoupling between energy consumption and economic growth. Relative decoupling occurs if energy consumption grows, but at a lower pace than the economy. Absolute decoupling occurs if the economy grows while energy consumption decreases. An absolute decoupling is likely to alleviate the environmental pressures of energy production and consumption.
- Primary energy consumption is defined by the Energy Efficiency Directive (2013/12/EU) as gross inland energy consumption minus non-energy uses.
- Gross final energy consumption is defined in Directive 2009/28/EC on renewable energy sources as energy commodities delivered for energy purposes to final consumers (industry, transport, households, services, agriculture, forestry and fisheries), including the consumption of electricity and heat by the energy branch for electricity and heat production, and including losses of electricity and heat in distribution and transmission. The accounting rules in the Directive prescribe that electricity generated by hydropower and wind have to be normalised for annual variations (hydro 15 years and wind 5 years).
- GHG — greenhouse gases.
- The energy dependence rate shows the proportion of energy that an economy must import. It is defined as net energy imports divided by gross inland energy consumption plus fuel supplied to international maritime bunkers, expressed as a percentage. A negative dependency rate indicates a net exporter of energy, while a dependency rate in excess of 100% indicates that energy products have been stocked.
SOER 2015 European briefings present the state, recent trends and prospects in 25 key environmental themes. They are part of the EEA's report SOER 2015, addressing the state of, trends in and prospects for the environment in Europe. The EEA's task is to provide timely, targeted, relevant and reliable information on Europe's environment.
For references, see www.eea.europa.eu/soer or scan the QR code.
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