Ecodesign Directive and Its Impact on Product Development

Iain NotmanSustainable Energy Using Products

16 March 2011

Contents

• Importance of product policy

• Overview of Ecodesign Directive

• Future measures

• Ensuring compliance

Why consumption by products important?

UK electricity consumption in reference, policy and best available technology scenarios

Why consumption by products important?

UK electricity consumption by product group in reference scenario

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Interventions: • Support innovation

Interventions: •Pricing and trading•Voluntary initiatives•Producer responsibility•Business support•Procurement•Labelling•Public information

Interventions:•Minimumstandards

PRODUCT INTERVENTIONS – Overall approach

Cut out the least sustainable products

Encourage development of new, more sustainable products

Drive the existing market towards greater sustainability

Aim of Government Policies

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PRODUCT INTERVENTIONS – Market change over time

Now Future 1 Future 2

Aim of Government Policies

CO2 savings vs ££ savings

Net benefit (£/tonne CO2) versus cumulative projected savings (Mt CO2, 2009-2030)

Ecodesign Directive

• Legal framework to set minimum standards for environmental performance

• European Commission brings forward implementing measures on specific products or product groups

• Aim to drive up standards by removing least efficient products from market

• Can be EU Regulations or voluntary initiatives from industry

• Energy Labelling Directive provides legal framework for labelling of products

How are products chosen?

• Sales within EU over 200,000 per annum

• Significant environmental impact within EU

• Significant potential for environmental savings without excessive costs

Decision Making Process

Preparatory Study

Consultation Forum considers

implementing measure

Regulatory Committee decides on regulation

European Parliament scrutiny

Implementing measure agreed and comes into

force

• Preparatory study to determine ecodesign requirements – 11-21 months

• Commission drafts implementing measure and discusses with stakeholders at Consultation Forum

• Commission: revises implementing measure; carries out impact assessment & inter-service consultation; and presents formal proposal to Regulatory Committee of Member States

• European Parliament scrutinises implementing measure – 3 months

• WTO notification, finalisation etc – 3-4 months

• Adoption by Commission (translation and written procedure) – 5 months

• Regular review to keep standards up to date

Implementing Measures Specify

• Products covered

• Application dates

• Generic and specific design requirements

• Measurement standards / methods

• Conformity assessment procedures

• Information requirements

Manufacturers’ Obligations

• Assess environmental aspects and impacts of product

• Design and construct in compliance with ecodesign requirements

• Carry out conformity assessment (generally self-assessment)

• Affix CE marking

Voluntary Initiatives

• Industry can propose voluntary initiatives as alternative to regulation

• Commission decides whether to accept

• UK Government favours voluntary initiatives when• Supported by industry• Market conditions correct• Sufficiently ambitious

• Commission officials:• Recommending Commissioners accept proposed voluntary

agreement for CSTBs• Carrying out impact assessment of proposed voluntary

agreement for imaging equipment

Where Next for Ecodesign?

• First phase: addressing electricity consumption of residential and tertiary sectors

• Second phase: focusing on energy consumption of industrial sector

• Where next?

Source: JRC report 2009, Electricity consumption and efficiency trends in EU, data from 2007 –(VC= vacuum cleaners)

8 ecodesign Reg. already adopted Cover 50% of residential electricity consumption

ecodesign Reg. in the pipeline /adoption by end 2011 (except for ovens, hobs and grills by 2012)

EU-27 residential electricity consumption

14%

3%

6%

11%

1%

5%

2%7%3%

18%

9%

2%

3%

8%

8%

refrigerator-freezers

dishwashers

washing machines

lighting

set top boxes

stand-by

external power supplies

television

computers

boilers

water-heaters

air-conditioning

ventilation

ovens, hobs and grills

others (driers, VC, etc.)

1st Phase – Residential Sector

1st Phase – Tertiary Sector

Source: JRC report 2009, Electricity consumption and efficiency trends in EU, data from 2007

ecodesign Reg. already adoptedCover over 30% of tertiary electricity consumption

Ecodesign Reg. in the pipeline /Adoption by 2011 - 2012

Breakdown of EU-27 tertiary sector electricity consumption

1%

4%

21%

6%

3%

8%18%

3%

8%

12%

5%

5%6%

office appliances stand-by

street lighting

office lighting

circulators

computers

imaging equipment

space and water heating

air conditioning

commercial refrigeration

ventilation

pumps

cooking appliances

others

2nd Phase – Industrial Sector

• Ecodesign Regulations adopted or in pipeline cover 60% of electricity consumption of industrial sector, including:

• Electric motors, pumps, compressors, fans

• Preparatory studies ongoing:

• Air-conditioning and ventilation systems, industrial and laboratory furnaces and ovens, machine tools, professional refrigerating and freezing equipment, transformers

EU Energy Efficiency Plan 2011

• Published 8 March 2011

• Increasing the competitiveness of European manufacturing industry

• Building on the success of ecodesign measures as an effective tool to stimulate innovation in energy efficient European technologies, the Commission is investigating whether and which energy performance (ecodesign) requirements would be suitable for standard industrial equipment such as industrial motors, large pumps, compressed air, drying, melting, casting, distillation and furnaces.

• Promoting energy and resource efficient appliances

• Commission will continue this approach, setting stricter consumption standards for heating boilers, water heaters, computers, air conditioners, tumble driers, pumps, vacuum cleaners and further types of lighting. It will also bring forward a new working plan for 2012-2014. ...

• In its future work on ecodesign and energy labelling the Commission will examine the option, where relevant, of covering systems as well as individual products. ... [the Commission] will strengthen market surveillance to ensure that product requirements are properly implemented and will support measures to help consumers, installers and retailers make best use of energy labels.

Building Blocks for Future

1. Independent evaluation of functioning of Directive

• Due to end December 2011

2. Study to provide background information and analysis for (second) Working Plan

• Due to end October 2011

3. Review and update of methodology for preparatory studies

• Due to end September 2011

State of Play – EU

Standby 35 TWhSimple set-top boxes 6 TWhStreet & office lighting 38 TWhExternal power supplies 9 TWhDomestic lighting 39 TWhElectric motors 140 TWhCirculators 27 TWhDomestic fridges & freezers 5 TWhTVs 43 TWhDishwashers 2 TWhWashing machines 1.5 TWhFans 34 TWhComputer and displays 34 TWh

Potential annual savings across EU by 2020 from measures adopted or with imminent adoption

State of Play – UK

Product Type Net CO2e Saved Per Year in 2020

(Mt CO2e)

Net Energy Saved Per Year in 2020

(TWh)

Average Annual Net Benefit, 2010-2020

(£m) Stand-by 2.1 3 £196m Simple Set Top Boxes 0.5 0.5 £47m Tertiary Lighting 1.55 3.6 £109m Power Supply Units 0.1 0.2 £4m Domestic Lighting 0.65 0.3 £108m Televisions 0.8 0.85 £100m Motors 1.4 3.35 £165m Cold Appliances 0.75 0.75 £88m Wash Machines 0.1 0.3 £18m Dishwashers 0.1 0.25 £18m Stand-alone Circulators 0.4 -0.05 £13m Fans 0.15 0.4 £44m Total 8.6 13.5 £910m

Projected UK savings from measures agreed to date

Will 2011 bea busy year?....

Commission’s Plan for 2011

Energy Labelling Directive

• Transposition deadline 20 June, proposing:

• Single overarching UK SI – will revoke existing UK labelling regulations, and refer directly to EU delegated acts

• Same enforcement regime (NMO for suppliers, TSOs for dealers), but with ASA monitoring advertising requirements

• Considering introducing civil sanctions

• First new labels will be mandatory from Nov/ Dec 2011 (dishwashers, washing machines, cold appliances, TVs)

Importance of Enforcement

• Effective enforcement is essential to

– Deliver desired economic and environmental benefits

– Protect businesses from unfair competition

– Ensure consumers benefit financial savings

• Previously only criminal sanctions available

• Aim to create more flexible and proportionate enforcement regime

UK Regulations

• Ecodesign Regulations

– Ecodesign Regulations 2010 transpose Ecodesign for Energy Related Products Directive (2009/125/EC) into UK law

• Came into force – 20 November 2010

– Include civil sanctions and cost sharing

• Labelling Regulations

– Will introduce Regulations in 2011 to transpose Recast Energy Labelling Directive (2010/30/EU)

– Will consider inclusion of civil sanctions and cost sharing

New Sanctions Regime

• Aim to resolve non-compliance through informal collaborative processes

• Where these fail, new civil sanctions available

• Criminal penalties remain for most serious cases

Types of Civil Sanction

• Compliance Notice: Written notice requiring actions to comply with law

• Stop Notice: Written notice requiring end to activity causing harm or serious risk of harm

• Enforcement Undertakings: Voluntary agreement to actions to address non-compliance

• Variable Monetary Penalty: Monetary penalty which market surveillance authority may impose for more serious offence

Cost Sharing

• Government initially funds all tests on product

• If proven that product does not comply, can require business to reimburse all testing costs

• Right of appeal to First Tier Tribunal against civil sanctions and cost sharing

Next Steps

• Developing guidance on civil sanctions and cost sharing in consultation with stakeholders

• Work with stakeholders to assess use of new sanctioning powers

• Carry out formal review in two years

Ecodesign-ADCO

• Administrative Cooperation for Market Surveillance Group for the Ecodesign Directive 2009/125/EC

• Brings together MSAs from EU and others applying Ecodesign Directive

• Discuss understanding of legislation to enable consistent approach

• Share testing plans and results in confidence

• For further information:

efficient.products@defra.gsi.gov.uk