The Energy Efficiency Act as a framework for sustainable reinvestments in companies?

Industry is the second largest emitter of greenhouse gases in Germany after the energy sector. Companies therefore have a crucial role to play in decarbonisation and reducing the overall consumption of resources in the economy. However, over the last 30 years, industrial energy consumption has barely fallen despite increasing efficiency. In order to implement the necessary climate protection measures, industry investments of around 50 billion euros are necessary by 2030, of which around 20 billion euros will go to increasing energy efficiency through sustainable reinvestments or replacement investments in systems and the decarbonisation of process heat as well as new systems. 

In order for these reinvestments to actually be made, the existing framework needs to be expanded, as the current political framework does not mobilise enough investments. In addition, care should be taken to avoid rebound effects as a result of reinvestments in energy efficiency improvements so as not to reduce the ecological effectiveness of the measures. Rebound effects occur when there is an increase in demand for energy or materials as a result of an efficiency measure. Here too, the political framework can and must create an environment in which this happens. The main question is what such a political framework looks like and how companies deal with it. 

As a national response to the European Energy Efficiency Directive, the recently passed Energy Efficiency Act creates for the first time a cross-sector regulatory framework for greater energy efficiency in Germany. The law includes energy efficiency targets for final energy consumption by 2045. In addition, depending on energy consumption, companies should be obliged to introduce energy management systems, carry out economic viability assessments of identified energy efficiency measures and comprehensively record waste heat sources and potential, as well as avoid or recycle waste heat. 

With these goals and signals, does the Energy Efficiency Act create an effective and suitable framework to promote sustainable reinvestments in companies? 

The ENRI research project, funded by the Federal Ministry for Economic Affairs and Climate Protection (BMWK), examines factors influencing sustainable reinvestments in companies from an interdisciplinary perspective. As part of the project, a conceptual framework was developed for analysing the political framework conditions for sustainable reinvestments. Against this background, four policy principles for regulatory law were identified that promote sustainable reinvestment in companies. The Energy Efficiency Act can be critically classified based on these principles.