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Counting project savings—an alternative way to monitor the results of a voluntary agreement on industrial energy savings

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Abstract

In 2008, the Dutch voluntary agreements on industrial energy efficiency faced fundamental changes to their monitoring methodology. Where the old method was based on measuring the improvement of energy use per unit of production, the new method focuses on the energy savings from projects implemented by participating companies. Advocates of the new method claim that it gives a better view of the companies’ efforts to save energy, as it shows their deliberate changes in production processes, whereas opponents emphasise that the relation with ‘real’ energy efficiency is lost. By applying the two methods on the same group of companies, the results can be compared and show to what extent the choice of monitoring method affects the key message to policy makers. Of special interest is the relation between energy and production in the period 2008–2012, a period with large fluctuations in the level of production and energy use as a result of the economic crisis. The data show that energy-saving projects made a significant impact on energy use in the analysis period, although their effect is smaller than that of other factors such as fluctuations in production and in the number of participating companies. The old method shows a result for the period 2005–2013 that is less than half of that of the new method, mainly because of a decrease in efficiency during years of decreasing production. The analysis clearly shows that the two methods do not show the same development of energy efficiency improvement and should be presented as such.

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Notes

  1. Here we use the term VA when referring to the instrument in general and LTA when referring to the LTA instrument in the Netherlands.

  2. Differences between programs in different countries originate in part from differences in company culture and organisation (Montgomery 2014). A study of the impact of these differences falls outside the scope of this article.

  3. The second category is chain efficiency. These measures improve energy efficiency not within the own company but elsewhere in the production chain from raw material to end use and the energy supply needed for that purpose. Chain efficiency can be improved by improving performance, reducing the amount of materials needed, more efficient transport of goods and products, savings during the phase of product use (lower energy consumption or life cycle extension) or savings arising from efficient and effective disposal of products (reuse, recycling, the use of material for energy generation). For LTA companies, renewable energy is also an option as third category. These measures do not save energy use per se but only fossil energy use and thereby ‘green’ the energy use of the company. All three categories contribute to the result, and a certain trade-off between the categories is possible. However, adding the results could lead to misinterpretation as the two extra categories have no relation to actual energy use or efficiency.

  4. As the new reference year 2005 was agreed upon in 2008, companies had to re-establish the reference energy use in 2005. For most companies, this was done correctly, but for a small number of companies, it was not possible to establish a consistent production data set for the whole period. Problems can occur because companies have made calculation errors or because they have merged or split different production units for different product groups, e.g. first one unit for all products and later one unit for fresh products and one for frozen products. Although this concerns only 43 companies, the effect is about as large as the effect of population changes, as the large oil- and gas-producing companies are among this last group.

  5. National Statistics have a statistic on capacity use for industry (Conjunctuurenquete). Although it is based on a sample of companies, their trend gives a reasonable good match on our production figures: over the same period, they find capacity use decreased 3.0 %.

  6. For instance in the case of the metallurgic industry of 2012, see http://www.rvo.nl/subsidies-regelingen/sectorrapportages-industriële-sectoren. An analysis of 27 companies that did not report all certain planned projects for 2013 revealed four companies that had implemented these projects but had not (yet) reported them. An analysis of 128 projects that had been reported with a zero saving revealed 16 projects for which savings could not be calculated.

  7. An evaluation of the Danish Energy Efficiency Obligations in 2012 was able to determine that the net savings impact of the Danish Energy Efficiency Obligation is about a third of the reported savings. Additionality appeared to be 52–60 % for industry (Bundgaard et al. 2013). By comparing company-level savings in the Irish Large Industrial Energy Network (LIEN) to total industry savings (calculated using a top-down method), it could be estimated that 38 % of total savings could be attributed to participation in the program (Cahill 2012a). An analysis of seven VAs by Vreuls et al. (2005) found that around 50 % of efficiency improvement could be credited to the program. Rietbergen et al. (2002) used two methods to isolate the impact of LTA1, the first Dutch agreements on energy efficiency. Through a combination of expert judgement and a survey, it was found that 27–44 or 29–44 % respectively could be attributed to the implementation of LTA1. The most recent evaluation of LTA3 concludes that the effect of the agreements as a separate instrument is difficult to establish, but several studies, based on surveys and interviews, mention an additionality of 50 % (Volkerink et al. 2013). A large part of the reported savings could be attributed to other policy instruments, but it is very hard to attribute savings to a specific instrument when multiple instruments are in place simultaneously. A part of the reported savings could also be attributed to autonomous savings, savings that would have occurred anyway, and therefore should officially not be counted as saving effect in the definition of Boonekamp (2005). It is difficult to determine exactly how large this autonomous savings are. A recent evaluation of the long-term agreements for ETS companies concluded that 86 % of respondents claimed that the agreements were ‘(very) important’ for implementation of energy-saving projects, but at the same time, 64 % of respondents stated that 80 % or more of those projects would have been implemented anyway (Hendriksen and van der Kolk 2013).

  8. Incidentally, projects that have been reported are being decommissioned, i.e. when it appears that product quality is being affected. This does not happen often, as in most of these cases, the project is stopped before it is reported in the monitoring reports. A more substantial ‘dissaving’ occurs with good housekeeping measures, whose effect usually lasts less than 3 year (CEN 2007). Companies are requested to report these kinds of measures only once, but this rule is difficult to uphold. Therefore, it is likely that the reported savings under this category are an overestimation. As this is the smallest category, the total effect is not big but could be 0.1–0.2 % annually (Abeelen et al. 2013).

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Authors and Affiliations

  1. Rijksdienst voor Ondernemend Nederland, Croeselaan 15, 3521 BJ, Utrecht, The Netherlands

    Christiaan Abeelen

  2. Copernicus Institute of Sustainable Development, Utrecht University, Heidelberglaan 2, 3584 CS, Utrecht, The Netherlands

    Robert Harmsen & Ernst Worrell

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  1. Christiaan Abeelen
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  2. Robert Harmsen
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  3. Ernst Worrell
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Correspondence to Christiaan Abeelen.

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Abeelen, C., Harmsen, R. & Worrell, E. Counting project savings—an alternative way to monitor the results of a voluntary agreement on industrial energy savings. Energy Efficiency 9, 755–770 (2016). https://doi.org/10.1007/s12053-015-9398-3

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