Energy security and energy efficiency issues: household perspective in European countries prof. dr. Manuela Tvaronavičienė Vilnius Gediminas Technical University 2016

Content Research topicality What do we mean by sustainable and secure development Sustainability and competitiveness Has competitiveness time dimension? Energy use and competitiveness in short-term and competitiveness in long-term Insights

Research topicality Sustainability and Competitiveness has become key (buzz) words Sustainability is still understood differently Sustainability is not seen as security of development Short-term and long-term competitiveness is not being distinguished Factors affecting long-term competitiveness are not known Role of energy use remains controversial

What do we mean by sustainable and secure development There are many perceptions of development The most common- economic development, most frequently measured by GDP per capita Countries agreed to measure development by Human Development Index, which incorporates income level and quality of human capital estimated through longevity and education Sustainable development conventionally embrace three pillars: economic, social and environmental. What indicators to include into each pillar remains object of on-going discussion

What do we mean by sustainable and secure development We claim that in contemporary world sustainable development means secure development Security has many dimensions, but here we will focus on one of them: efficient energy use

A little bit of statistics from the International Energy Agency

Why is that? Because of famous WHAT?

Sustainability and competitiveness If sustainability means security, it means our development is not sustainable because is insecure Competitiveness means ability to sell In order to sell you need to produce, when you produce, you use energy

Has competitiveness time dimension? Assumption is: Long-term competitiveness of countries will be based on efficient energy use Short-term competitiveness does not automatically mean long-term competitiveness

Who are energy users? Producers (industry, agriculture) Households Transport

Analysis of energy intensities in selected countries The following countries have been selected Lithuania, Latvia, Estonia, Bulgaria, Belgium, Germany and Luxemburg. The following users have been chosen: households and agriculture Lithuania, Latvia and Estonia are similar countries in terms of geographical location, history and level of economic development. Bulgaria has been selected as country, which is among the weakest among European Union members judging from the point of view of statistically measured economic development. Belgium, Germany and Luxemburg represent the richest the EU countries. Those three countries has been selected with a purpose to observe if consistent patterns can be traced; i.e. to verify, if forecasted energy intensities can be characterized by the same trends of change and if countries’ size and economic specialization affect trends, which will be revealed in result of analysis.

Assumption Energy intensities in the long-term will diminish in all sectors, i.e. Household Industry and agriculture Transport We check our assumption by forecasting energy intensities in selected countries until year 2015 ceteris paribus Forecasting methodology: The Long-range Energy Alternatives Planning system (LEAP) is a widely-used software tool for energy policy analysis and climate change mitigation assessment developed at the Stockholm Environment Institute (SEI). It has been adopted by thousands of organizations in more than 190 countries worldwide. Its users include government agencies, academics, non-governmental organizations, consulting companies, and energy utilities, and it has been used at scales ranging from cities and states to national, regional and global applications. (LEAP web site: Environment Institute

Energy intensity raises (households, Lithuania)

Energy intensity raises (households, Latvia)

Energy intensity does not raise but its level remains 30 percent higher than in Baltic countries (households, Germany)

Results in selected countries The results of forecasting provide us rather unexpected and very interesting from scientific point of view results: in a year 2050 Lithuania energy intensity measured in kilowatt hour per person will be , in Latvia , in Estonia , in Bulgaria , in Belgium and Germany respectively and and in Luxembourg will reach striking heights of kilowatt hour per person. It means in long term now less developed EU countries might surpass current leaders

Energy intensity diminishes in agriculture (Lithuania)

Energy intensity diminishes in agriculture (Latvia)

Energy intensity diminishes in agriculture (Estonia)

Energy intensity diminishes in agriculture (Germany)

Results in selected countries Lithuania’s agricultural intensity during period would change from 1.8 to 0.3 kilowatt-hour per European Euro. Latvian agricultural energy intensity would diminish 2.5 to 0.9 and Estonia’s respectively from 4.7 to 1.5 kilowatt-hour per European Euro. Here we see significant difference, despite the countries are rather similar as noted above. Estonian’s energy intensity is higher and diminishing rates are much lower if to compare to Lithuania. In Bulgaria energy intensity of agricultural sector will diminish from 2.7 to 0.3 kilowatt-hour per European Euro. Energy intensity improving rates and resulting intensity is much better than in Estonia, despite Bulgaria is less developed economically. In Belgium, Germany and Luxembourg energy intensities during considered period would change respectively from 1.2 to 1.9; 1.3 to 0.7 and 0.7 to 1.1. Here we do not observe such vivid tendency of energy intensity diminishing. Even more, Luxembourg demonstrates increase in energy intensity, the tendency which is detrimental to energy security and sustainable development phenomenon. Results are not expectable and not predictable. Lithuania’s data are the best. Bulgaria’s performance in sector of agriculture appear to be much better than in old, highly developed European countries It means in long term now less developed EU countries might surpass current leaders

Insights The presented paper argues, that energy security has to be perceived as constituent of security of countries and individuals. Security in its own turn serves as one of preconditions of sustainable development. Long-term sustainable and secure development could be achieved only by involving individuals and organizations into process of energy stewardship and so gradually shifting self-perception from energy security observers to energy security enhancers. Basing on the performed analysis the following insights can be formulated. The first, energy intensity of households in the long run is not going to diminish. That tendency has to be taken into account and interpreted as conditional threat. The second, energy intensity of such important economic sector, as agriculture will diminish considerably only in Lithuania and Bulgaria. Other countries will not demonstrate such good performance. The third, we suggest to use the best forecasted results for benchmarking purposes; hence energy intensity in household sector could be benchmarked by Kilowatt-Hour per Person and energy intensity in agricultural sector could be benchmarked by 0.3 Kilowatt-Hour per European Euro. Revealed trends and concrete results can be followed by respective policy implications in the area of energy use.

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