Green boondoggles everywhere

EU auditors criticise energy efficiency projects

An audit has found that EU-funded energy efficiency projects are not cost-effective in EU member states.

The projects examined by the Court of Auditors were in the Czech Republic, Italy and Lithuania. Those countries received the most EU funding for such projects in 2007-2013.

National authorities used the funds to refurbish buildings, but the spending would not be recouped for 50 years on average, the report said.

That time scale was "far too long".

In some cases the savings would not appear for up to 150 years. Such a delay would go beyond the expected lifetime of the buildings concerned.

In a wide-ranging package of green energy measures the EU has set itself the target of increasing energy efficiency by 20% by 2020.

The European Parliament's chief negotiator on the issue, Green MEP Claude Turmes, said the auditors were right to call for better selection of projects and better evaluation.

"Transparency can be improved. We need a higher political priority for energy efficiency, and qualified staff to develop national policies and do better project planning," he told BBC News.

The auditors looked at a sample of 24 energy efficiency projects co-financed by the Cohesion Fund and European Regional Development Fund. Under co-financing, the national governments contribute a percentage of the investment themselves.

Need for more data

The auditors say the European Commission, which allocates EU budget funds, should ensure that such projects undergo a thorough needs assessment first, and that proper monitoring for cost-effectiveness is done.

The report complained of a lack of necessary data, because energy audits are not mandatory in Italy and Lithuania. In the Czech Republic, where they are required, the recommended investment options were far too costly.

Last September the EU adopted a new Energy Efficiency Directive, in a drive to reach the 20% savings goal.

It calls on energy companies to cut by 1.5% annually the amount of energy they sell to customers and requires national authorities to refurbish at least 3% of public buildings.

Mr Turmes says energy efficiency will be more important in the next round of EU Cohesion funding, for 2013-2020.

It is a priority because the EU has a huge bill for oil and gas imports from outside Europe - bigger even than the EU's manufacturing trade gap with China, he says.

"We can meet the 20% target," he stressed. He said the directive's reporting process for each member state would mean tighter EU Commission monitoring of energy efficiency performance. Each country will have to present its energy efficiency plan to the Commission this April, he said.