€5 billion of EU energy efficiency project money spent on “comfort”

Press conference by Harald Wögerbauer, Member of the European Court of Auditors (on the left), on the cost-effectiveness of Cohesion Policy investments in energy efficiency. (EC Audiovisual Services)

The European Commission does not spare big words and photographic opportunities for Commissioners, whenever launching a new initiative or securing political agreement for a regulation. And they are doing this all the time. It seems like they spent all their energy and resources in conceiving new rules on everything. And of course they always need more personnel to write down all those new proposals.

What about results? Very rarely we see announcements about the results achieved after some years of application of a certain regulation. It will be a very interesting subject even for a PhD degree research, to count how many new rules, initiatives and spending programmes the Commission is announcing every year and how many debriefings on the achievements or the failures of the old ones are being organised in the Berlaymont building. Thank God there is the European Court of Auditors (ECA) which monitors regularly all EU legislation that entails spending of EU taxpayers’ money.

Energy efficiency

Incidentally it was yesterday 14 January 2013 when the ECA announced the findings of its audits on energy efficiency projects in a number of EU member states, which cost €5 billion. Of course the Brussels Commission had approved everything and all those “investments” were realised according to the rules set by the relevant EU legislation, introduced and monitored by the Commission.

What was the outcome of all those costly projects? Let the ECA speak: “EU Energy Efficiency investment targets not achieved; average pay back period exceeds 50 years (in extreme cases 150 years)”.

There is more on that from the ECA:”…the European Union, through its Cohesion Policy funds, spent almost €5 billion for co-financing energy efficiency measures in the Member States. The European Commission and the Member States are both responsible for the sound financial management of these funds…The Court found that the projects selected by Member State authorities for financing did not have rational objectives in terms of cost-effectiveness, i.e. cost per unit of energy saved. Their objectives were to save energy and improve comfort, but they were not selected for financing on the basis of their potential to produce financial benefits through energy savings, but rather that the buildings were typically regarded as being ‘ready’ for funding, if they were in need of refurbishment and their documentation complied with the requirements”.

Mind you the “documentation complied with the requirements”, says the Court’s auditor, so the responsibility lies entirely on the Commission side, because it was its services that wrote down those requirements and approved their application.

The Press Release of the ECA fortunately found a place in the Europa>Newsroom internet location, but understandably there were no celebrations by the co-responsible Commissioner Günther Oettinger.

More projects

On the other hand this last Commission member dully celebrated some time ago the political agreement on the new Energy Efficiency Directive. He must have been very proud of it. Commissioners are always proud in announcements. He made however no reference to what had happened to €5bn of European taxpayers’ money, which was used not for energy efficiency projects as it was planned by the Commission, but rather to “improve comfort”. Seemingly the EU Commission is always seduced by comfort.

The ECA however doesn’t stop here. Its Press Release continues as follows: ““None of the projects we looked at had a needs assessment or even an analysis of the energy savings potential in relation to investments”, said Harald Wögerbauer, the ECA member responsible for the report, “The Member States were essentially using this money to refurbish public buildings while energy efficiency was, at best, a secondary concern.”

And all that with the seal of the Brussels Commission, otherwise there would have being no disbursement of funds. It is an appalling fact, the ECA to have found that €5bn had being spent on “comfort” and “refurbishments”, totally outside the scope of the programme they meant to finance and the European Commission did nothing to change this.

That kind of money is a good part of the annual EU budget and actually they went down the drain. Is it possible that nobody can be held responsible for that? It might not be a penal case but aren’t there some internal rules in the Commission’s statutes for the waste of €5bn?

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