The Impact of the Energy Conservation Agreements at the End of 2006

Significant impacts of implemented conservation measures

Based on sector-specific annual report data for 2006, the impact of conservation measures implemented in enterprises and communities participating in the agreements by the end of 2006 totalled approx. 7.7 TWh/a (electricity 1.7 TWh/a, heating + fuels 6.0 TWh/a), which is equivalent to the annual electricity and thermal energy consumption of about 380,000 single family houses, calculated on the customary house consumption of 20,000 kWh/a.

81% (6.24 TWh/a) of the energy conservation effect of implemented conservation measures is reported under the industrial conservation agreement. The proportion of the power plant sector of the conservation impact of the implemented measures is 15 % (1.14 TWh/a). The remainder, under four percent, of the saving impact of implemented measures was reported in the district heating sector (0.09 TWh/a), municipal sector (0.08 TWh/a), power transmission and distribution sector (0.87 TWh/a) and the property and building sector (0.05 TWh/a).

The annual saving in energy costs achieved through implemented conservation measures across the agreement sectors is approx. 150 million Euros, estimated using the average heating and fuel price of €15/MWh and the average electricity price of €35/MWh. In order to implement the conservation measures, corresponding investments or more than 295 million Euros have been made in industry, and approx. 70 million Euros in the power plant sector.

The overall savings achieved through the Energy Conservation Agreement Scheme remained a little lower than the year before. Electricity savings were higher but the heat and fuel savings were less than half compared to the previous year. On the other hand, it was pleasing to note the continuous growth in the power plant sector.

Realisation of savings potential under consideration presents a challenge

As well as the savings achieved, the report covered measures where the decision to implement had been made, with a total savings potential across the various agreement sectors of approx. 1.5 TWh/a. The bulk of this savings potential, almost 90%, is reported in the industrial and power plant sector agreements, the share of industry being about 70%. The savings potential of decided measures again rose slightly from the previous year, but it has varied only a little over the years.

In addition to implemented and confirmed measures, the report includes measures classified as being under consideration, with a total savings potential of 5.5 TWh/a. The proportion of measures under consideration was at the same level as before. Converting this savings potential, equivalent to about 70% of savings potential already fulfilled, into real conservation is a great opportunity, and at the same time also a challenge to all parties.

Estimated energy savings clearly exceeded

At the launch of the conservation agreement scheme, the total savings potential across the various conservation agreement sectors at the end of 2005 was estimated at around 11 TWh/a, of which the share of electric energy would be about ten percent. Of this savings potential, about half was estimated to be reached by the year 2010.

The cumulative energy-saving impact of conservation measures reported as implemented by the end of 2006, 7.7 TWh/a is already 40% more than originally estimated. The share of electricity from the realised savings reported to date had grown particularly due to the upturn in the power plant sector, exceeding 22% at the close of 2006.

Carbon dioxide emissions reduced

The Climate Strategy and the associated Energy Conservation Programme (2003-2006) set the target of a reduction in greenhouse gas emissions to be achieved through all energy conservation measures at 3-4 million CO₂ tonnes. The energy conservation agreements have been assumed to play an important role in reaching this target.

Indeed, the reduction effects on carbon dioxide (CO₂) emissions of energy conservation measures reported under the energy conservation agreement scheme are considerable. The annual impacts of reported efficiency measures implemented to date on CO₂ emissions are 2.1-2.9 million CO₂ tonnes, depending on whether calculated by using the average coefficient 200 kgCO₂/MWh as the coefficient of CO₂ emissions for electricity, or the coefficient 700 kgCO₂/MWh based on marginal emissions. The average CO₂ emissions coefficient employed for heating and fuels is 290 kgCO₂/MWh, where distribution of implemented savings across different agreement sectors has been taken into account.

Thus, the reduction impacts on CO₂ emissions of energy efficiency measures reported under the Energy Conservation Agreement Scheme are considerable. Their carbon emissions –reducing effect at the end of 2006 was over two thirds of the previously proposed reduction target of 3-4 million CO₂ tonnes.