Context of energy saving policy

4 Figure 2 Energy consumption by sector Percentage in 2008

1.2 Relationship with other policy

National energy saving policy is an integral part of the Netherlands energy and climate policy. Until the end of 2010, the goal for energy saving policy an annual improvement in energy efficiency of 2 was one of the climate targets for 2020. The others were: a 30 reduction in CO 2 emissions relative to 1990 and an increase in the share of renewable energy to 20. The Netherlands energy and climate policy is in turn embedded in European energy and climate policy. The goal of European energy policy is to base the economy on the efficient use of a sustainable, competitive and continuous energy supply. The European energy saving target is: a reduction in energy consumption of 20 by 2020, compared to the level reached in a situation of unaltered growth from 2005. This target is not binding on the EU member states. The European Commission has announced that it will consider setting compulsory targets for the member states if the target for 2010 seems unattainable by 2013 European Commission, 2011. The other European energy and climate targets for 2020 are binding: a 20 reduction in greenhouse gas emissions relative to 1990 and a 20 share of renewable energy. The renewable energy 5 target for the Netherlands as a member state is a share of 14 of final energy consumption Directive 200928EC, 2009, p. 46. As noted above, the RutteVerhagen government abandoned the energy saving policy goal when it took office towards the end of 2010. Pursuant to the coalition agreement, the new government seeks a continuation and strengthening of the national approach to energy saving through a green deal with society Informateur, 2010. The RutteVerhagen government has not set additional national targets for CO 2 emissions or the share of renewable energy. The European targets are now the national policy targets.

1.3 Financial importance

The funds earmarked for the Dutch energy saving policy are provided from several ministerial budgets. Not all these budgets specify expenditure on energy saving policy separately; in such cases, the funds are part of a larger budget article. In consequence, the cost of the national energy policy cannot be calculated directly from the national budget. Estimates, however, can be made. They indicate that about €300 million of national funds has been spent on energy savings every year since 1999 EZ, 2008; Harmsen Menkveld, 2005. Tax schemes account for about half of the expenditure. The largest scheme is the Energy Investment Allowance EIA, €111 million in 2008. At the same time, however, the State has earned considerable amounts through the taxation of energy. In 2008, energy tax raised just over €4 billion, of which €425 million from the manufacturing and energy generation sectors. In principle, this income replenishes the public purse but in the past it was often returned to the taxpayer in the form of lower taxes on labour and profits.

1.4 Responsible ministers

Until the end of 2010, both the Minister of Housing, Spatial Planning and the Environment VROM and the Minister of Economic Affairs EZ were responsible for a part of the Netherlands energy saving policy. The Minister of VROM was responsible for coordinating Dutch climate policy, including energy saving policy. The Minister of EZ was responsible for the efficiency and sustainability of energy management and the development and execution of climate policy for the manufacturing and energy sectors. 6 In addition, individual line ministers were responsible for the development and execution of energy saving policy in the sectors covered by their portfolios. 2 Upon the inauguration of the RutteVerhagen government, ministerial portfolios were reshuffled and responsibility for energy and climate policy was reallocated. The newly formed Ministry of Infrastructure and the Environment IM is now responsible for climate policy. The equally new Ministry of Economic Affairs, Agriculture and Innovation ELI coordinates energy saving policy and is responsible for the green deal. Responsibility for specific energy consuming sectors was also changed. 3

1.5 Our audit: audit background, questions and

objective The annual monitoring data on energy savings show that the Netherlands has failed to achieve the governments ambitions for many years. The ambitions have been revised on several occasions since 1995, but they have rarely been achieved. A more detailed international comparison, furthermore, reveals that the Netherlands uses significantly more energy per unit of production than other OECD countries, 4 even after correction for specific national features of the Dutch economy CPB, 2010. Against this background, the main audit questions were: 1. Why have the energy saving targets not been achieved? 2. What consequences does this have for the feasibility of the national and European energy and climate targets for 2020? 3. What opportunities are there to strengthen policy? We answered the first two questions in respect of energy saving policy as a whole in the period 1995-2008. Our answer to the third question is confined to the manufacturing sector because manufacturing is the 2 The responsibilities for specific energy consuming sectors were as follows: the Minister for Housing, Communities and Integration WWI was responsible for policy in the built environment sector; the Minister of Transport, Public Works and Water Management VW was responsible for managing the volume of traffic in the transport sector; the Minister of Agriculture, Nature and Food Quality LNV was responsible for policy in the agriculture and horticulture sectors; and the Minister of Finance was responsible for the execution of green tax measures. 3 The Minister of BZK is now responsible for the built environment sector, the Minister of IM for the transport sector and the Minister of ELI for policy in the agriculture and horticulture sectors. 4 The Organisation for Economic Cooperation and Development OECD is an alliance of 34 countries established to coordinate social and economic policy.