Ecodesign Directive and Its Impact on Product Development Iain Notman Sustainable 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

Aim of Government Policies

CO 2 savings vs ££ savings Net benefit (£/tonne CO 2 ) versus cumulative projected savings (Mt CO 2, )

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 – 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) 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 adopted  Cover over 30% of tertiary electricity consumption Ecodesign Reg. in the pipeline / Adoption by

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 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 Study to provide background information and analysis for (second) Working Plan Due to end October Review and update of methodology for preparatory studies Due to end September 2011

State of Play – EU Standby35 TWh Simple set-top boxes6 TWh Street & office lighting38 TWh External power supplies9 TWh Domestic lighting39 TWh Electric motors140 TWh Circulators27 TWh Domestic fridges & freezers5 TWh TVs43 TWh Dishwashers2 TWh Washing machines1.5 TWh Fans34 TWh Computer and displays34 TWh Potential annual savings across EU by 2020 from measures adopted or with imminent adoption

State of Play – UK Product TypeNet CO2e Saved Per Year in 2020 (Mt CO2e) Net Energy Saved Per Year in 2020 (TWh) Average Annual Net Benefit, (£m) Stand-by2.13£196m Simple Set Top Boxes0.5 £47m Tertiary Lighting £109m Power Supply Units0.10.2£4m Domestic Lighting £108m Televisions £100m Motors £165m Cold Appliances0.75 £88m Wash Machines0.10.3£18m Dishwashers £18m Stand-alone Circulators £13m Fans £44m Total £910m Projected UK savings from measures agreed to date

Will 2011 be a 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

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