Main conclusion 1c NCA Full report Energy saving ambitions and results (2011) (English)

10 provided there was sufficient flexibility Menkveld Wijngaart, 2007, p. 21. It was therefore clear that every effort would be needed to achieve the target of 2 per annum. Most sectors, however, fell far short of this target.  Only the agriculture and horticulture sector achieved a substantial energy saving in recent years. Since this sector accounts for only a modest share of total energy use, it has made only a limited contribution to energy saving.  The measures introduced for the manufacturing sector were not sufficiently binding. The saving induced by the policy was therefore limited.  In the built environment sector, savings were achieved chiefly on account of the European minimum efficiency standards for domestic appliances and buildings.  Not enough instruments were used in the transport sector and virtually no saving was achieved. The failure of the policy was predictable. It was clear in advance to successive governments that the energy saving ambitions were not backed up by appropriate policy instruments. Every effort would have to be made to have a chance of achieving the targets. A number of important policy instruments, however, were not included in the policies announced, or were introduced far later or in a weaker form than foreseen. Studies carried out for the Ministries of VROM and EZ have consistently shown in recent years that the proposed policy measures would not achieve the targets. The ministers concerned did not respond to these warnings and use them to strengthen policy or review the targets. This lack of effectiveness can be explained in part by the absence of clear agreements on the targets and responsibilities. In 2007, when the national energy saving goal was last revised, no specific agreements were made on the secondary goals to be achieved in individual sectors or on the ministers who would be responsible for them. In the years that followed, it was therefore uncertain who was responsible for taking additional policy measures to make up or any underachievement. In consequence not all line ministers took decisive action when it became clear that the energy saving in their sectors was inadequate. We consider the results of energy saving policy in more detail in chapters 2 and 3 of part II of this report. 11

2.2.2 Policy effectiveness in the manufacturing sector

The policy conducted in the energy-intensive manufacturing sector in the period 2000-2007 increasingly became less compulsory. The policy had few results. The energy saving achieved 0.5 per annum on average was less than the saving that would have occurred without policy the autonomous development of 0.8-1 per annum. In the period 1995-2007, the manufacturing sector as a whole performed slightly better 1.5 per annum on average than the national average 1.1 per annum. The national average, however, was significantly reduced by the transport sector. Between 1995 and 2008 the policy for energy intensive manufacturing companies, which are responsible for 80 of energy consumption in the manufacturing sector, had little effect. There are several reasons for this:  The governments main policy instrument for energy intensive companies was the Benchmarking Agreement. A series of side letters, however, weakened the agreements obligations and it ultimately had no effect: the 139 participating companies saved less energy than the autonomous saving.  The European CO 2 emissions trading system did not work in practice until 2008, chiefly because of the generous allocation of emission allowances.  The most energy intensive companies were exempt from the top rate of energy tax on electricity consumption in 1995-2008 because they participated in the first multiyear energy efficiency agreements and then in the Benchmarking Agreement. 7  The statutory energy saving obligations the government introduced did not apply to energy intensive companies participating in the European CO 2 emissions trading system. 8 At present, the emissions trading system is the most important instrument to encourage energy intensive and many other medium-sized and large companies to save energy and ultimately to reduce CO 2 emissions. The instrument has had some effect since 2008 but at relatively high cost. This is because the price of an emission allowance the working ingredient is still low relative to the cost incurred by the government and the administrative burden on industry see section 2.2.4. 7 This exemption is still available because the companies are now participating in the successor to the Benchmarking Agreement, the Multiyear Agreement on Energy Efficiency for ETS Companies MEE. 8 It is also difficult to get other companies to fulfil these obligations and it is open to question whether they can actually be enforced. We return to this matter in our recommendations see section 2.3.2.