The energy crisis, high prices and threat of supply disruption following Russia’s war against Ukraine has prompted many small and medium-sized enterprises (SMEs) to seek ways to reduce their energy consumption and increase the use of renewables.
“The energy crisis helped SMEs discover that there are opportunities. In our case it was the threat to energy supply because they didn’t know if there would be supply of energy and that’s why they switched to some renewables to be independent, in order to continue their business operation in case there is a blackout. It’s as simple as that,” Czech expert Alena Mastantuono, Vice President of the Section for Transport, Energy, Infrastructure and the Information Society (TEN), told NE Global. “We are 400 kilometers from Ukraine so you never know what can happen, but I think it helped them to discover these opportunities,” Mastantuono, who is a member of the employers’ group in the European Economic and Social Committee (EESC), said in Brussels.
A LEAP4SME conference at the European Parliament in Brussels on July 4 focused on the role of SMEs. Boosting energy efficiency and renewable energy in EU countries has taken central stage in the face of mounting challenges posed by climate change and rising energy costs.
“The combination of (Russian President Vladmir) Putin’s chokehold on gas supplies, the most severe drought on record and a failing conventional power fleet created the conditions for a perfect storm,” said Danish MEP Niels Fuglsang, rapporteur of the Energy Efficiency Directive. “A scenario that could repeat itself in the coming winter,” he added.
Mastantuono highlighted the role of renewables in energy efficiency from an EU but also a global perspective. EU regulation must be effective, motivating for SMEs and not a brake to energy efficiency and renewable energy, she said.
“For us it’s always better to have a global approach because we need to have a level playing field for our SMEs because they are competing also with SMEs from abroad in third countries outside the EU. But the incentives that I mentioned are that you need to do it at national level. You can have tax reliefs or depreciations or other positive instruments that you can use, and these can be used everywhere in the entire world,” Mastantuono told NE Global.
She said EU energy efficiency policy should not be an isolated approach but combined with renewables to reduce energy consumption.
The LEAP4SME project, funded by the H2020 research and innovation program, recognizes that SMEs, despite their size, collectively account for a substantial portion of energy consumption. According to the International Energy Agency (IEA), SMEs account for at least 13% of global final energy consumption annually. SMEs account for 99% of European businesses.
Energy efficiency and global competitiveness
SMEs operate in diverse sectors and face unique challenges, making a one-size-fits-all approach ineffective. Energy efficiency can save money and must present a business case for SMEs, Mastantuono said.
SMEs in Europe are enterprises with fewer than 250 persons employed but the majority are small or micro enterprises. “Very small businesses sometimes they really don’t make a big difference. Sometimes they’re not even able to deploy the renewables or the energy efficiency in the buildings because they just rent them. As a tenant sometimes you cannot influence where you are. We have a couple of good examples in Europe where you can rent the PV source in the roof but then the landlord must agree with you. The big change will certainly be done in the large companies but also in public sector. I think the public sector should lead by example,” the TEN Vice President said.
The updated Energy Efficiency Directive will further support SMEs in taking up energy efficiency measures and performing energy audits, LEAP4SME said. According to the EED recast, it is now the responsibility of Member States to encourage the accessibility of high-quality energy audits and establish one-stop shops that offer SMEs and microenterprises technical, administrative, and financial guidance.
Meanwhile in Strasbourg on July 12, MEPs approved plans, already agreed with the European Council, that set new energy saving targets for 2030, as part of the EU Green Deal. The law will set energy-saving targets in both primary and final energy consumption in the bloc.
According to the Parliament, member states will have to collectively ensure a reduction in energy consumption of at least 11.7% at EU level by 2030 compared to the projections of the 2020 Reference Scenario monitored by an enforcement mechanism accompanying this objective to make sure member states deliver on their national contributions to this binding EU target.
By 2030, EU countries need to save on average 1.5% per year, MEPs said, adding that the annual energy savings will begin with 1.3% in the period until the end of 2025 and will progressively reach 1.9% in the last period up to the end of 2030. The saving targets should be met through local, regional, and national measures, in different sectors – for example, public administration, buildings, businesses and data centers.
MEPs insisted that the scheme should cover the public sector, which will have to reduce its final energy consumption by 1.9% each year. Member states should also ensure that at least 3% of public buildings are renovated each year into nearly-zero energy buildings or zero-emission buildings. This echoes Mastantuono’s earlier statement that the public sector should lead by example in energy saving measures.
Czechs to phase out coal
Turning to her home country, the Czech Republic, Mastantuono reminded that it is an energy intensive country. The Czech Republic reportedly has the third-highest greenhouse gas emissions per capita in the EU but wants to phase out coal of the energy mix by 2033.
The Czech Republic has nuclear energy, coal, and natural gas in its energy mix, she said. “The industrial sector accounts for 30% of the economy so we are CO2 producers. We need to deploy cleaner energy as much as possible to replace coal and unfortunately the gas as well,” she said. “But we have to also consider that with electrification, you will need more electricity so you just cannot look at what you are replacing today but you need to replace what you will producing more in the future, so the Czech Republic chose nuclear, Mastantuono said, which is one of the reasons the current centre-right Czech government like its predecessors is pushing the EU to relax the rules on nuclear power.
