Publications of Ürge-Vorsatz, D.

Energy efficiency policy in an enlarged European Union: the Eastern perspective

In May 2004 eight former communist countries of Central and Eastern Europe joined the European Union (EU), ending the era of economic transition. During the accession process their energy sectors had to undergo fundamental reforms and restructuring, and after having to adopt European legislation, the main framework of their energy policies now should be up to speed with those of the EU-15.However, the legal harmonization process was entirely one-way. How well do the present EU energy efficiency policies cater to the needs of the new member states? What is the end result of the transition and accession process in this field? What has the ambitious restructuring schedule delivered in these countries from the perspective of energy efficiency? Where are these countries in terms of energy efficiency policies today, compared to the old member states? How should EU energy and environmental policies change or be strengthened to accommodate the different settings in the accession countries?These questions were answered as a part of a study commissioned by the European Parliament and completed by the Central European University. The paper will portray the development of energy intensity during the accession process, and catalogue the policies in place today influencing the efficiency of energy use. The paper then provides recommendations on how the efficiency of energy consumption could be promoted further, and what EU-level policies could be introduced to facilitate these changes. Among other suggestions, the paper points to the importance of policy integration and the decentralisation of policy implementation to the municipal level.

Tradable certificates for energy savings: Opportunities, challenges, and prospects for integration with other market instruments in the energy sector

Policy portfolios that include tradable green certificates have been introduced in several European countries to foster market-driven penetration of renewable energy sources. Another widely analysed type of market-based instrument in the energy sector is the tradable emission allowance. Recently tradable certificates for energy savings as a tool to stimulate energy efficiency investments and deliver energy savings have attracted the attention of policy makers. While such schemes have been introduced in different forms in Italy and the Great Britain and considered in other European countries, there is an ongoing debate over their effectiveness and applicability. The paper describes the concept and main elements of schemes that involve tradable certificates for energy savings (TCES) and how these have been put into practice in Italy and the Great Britain. It then compares TCES schemes with energy taxation and mandatory demand-side management (DSM) programs using a set of four criteria. Integration with green certificates and CO2 emissions trading schemes is examined and some possibilities for practical implementation are outlined.

Energy policy in Eastern Europe: A research report

A significant amount of research has examined the various development paths and transformation models of the post-socialist states. The literature in the fields of economics and political science frequently singles out the energy sector in order to identify the main trends of the transformation process. This article discusses the findings of analyses of energy policy and the energy economy in East-Central Europe and Russia, and of studies of the effects of EU accession on the energy sector. The main issues examined are the heavy burden placed on the environment by the energy sector and the low level of energy efficiency.

Electricity disclosure: will It transform electricity markets?

In a regulated monopoly environment, the utility bill is often the only perceived characteristic of electricity service. With the liberalization of electricity markets, electricity becomes a product with multiple characteristics. The option of choosing between products and providers naturally creates the need for more information related to the electricity the consumer is buying. Therefore, electricity disclosure—providing the consumer with information related to the characteristics of purchased electricity—is becoming an integral component of liberalized markets.Following the footsteps of several states in the US and some other pioneers worldwide, in June 2003 the European Union adopted Directive (2003/54/EC). The directive required, among other rules and principles for the completion of the internal electricity market, mandatory disclosure of information on the origin of the electricity from suppliers. A European-wide, sixinstitute research project titled “Carbon Consciousness and Consumer Choice in Electricity” has been providing guidance for the efficient design of the European scheme. The project has studied residential and commercial consumers’ preferences (through focus groups and a large EU-wide telephone survey) towards a disclosure regime, as well as making an attempt to understand the potential impacts of disclosure.The present paper will present some of the results of the project, combined with evidence from the literature documenting the impacts of disclosure schemes worldwide, and answer the following questions. Does, or will, electricity disclosure transform electricity markets towards more environmentally sustainable ones? If we empower the consumer with information on their electricity product or supplier, will this influence their choice? Beyond the consumer effect, can disclosure transform the market through other pathways? How will disclosure interact with existing policies, such as existing voluntary markets for ‘green’ electricity? What other characteristics of disclosure make it an essential component of liberalised electricity markets?

Kyoto Flexibility Mechanisms in an enlarged EU: will they make a difference?

Many indicators and market evidence suggest that there are still sizable potentials for cost-effective investments into energy efficiency in the eight post-communist new EU member states. However, as long as the governments of these countries still struggle with economic revival and huge budget deficits, it is unlikely that a generous amount of state funds will be directed towards tapping these potentials. Market-based instruments, therefore, offer an attractive alternative to deliver energy efficiency as opposed to hard-to-obtain subsidies.A study commissioned by the European Parliament and executed by Central European University has examined, among others, the role and potential role of new economic instruments in promoting sustainable energy pathways in the new member states. The present paper explores the effect flexible mechanisms under the Kyoto Protocol may have on energy efficiency, fuel switch and the development of renewable energy sources in this region. These eight countries are chief candidates for hosting Joint Implementation projects and for participating in International Emission Trading schemes, which may assist the implementation and financing of energy efficiency, renewable energy, and fuel switching projects. The article reviews the potentials and barriers to Joint Implementation, and the conditions under which International Emission Trading can influence the energy use of the selling country. The research has also examined the different strategies the host countries chose to adopt towards the application of these instruments, and the impact of the strategies on short- and medium term energy sustainability. The paper concludes that the flexibility mechanisms may play a positive but rather limited role in the sustainable energy development of the region, and that due to the barriers to JI the emphasis may shift towards emission trading. If emission trading transactions are carried out through innovative mechanisms tied to sustainable development goals, it may play an important role in mobilising the energy efficiency potentials of these countries.

Analyzing CO2 emissions mitigation by technology improvement in Central and Eastern Europe

As a legacy of the centrally planned economy, the economies in transition of Central and Eastern Europe (CEE) have a unique potential to reduce their greenhouse gas emissions through the improvement in their high energy intensities. Since much of this 'low-hanging fruit' in energy-efficiency improvements can be highly cost-effective, many developed countries facing difficulties in meeting their greenhouse gas (GHG) emission targets domestically are eager to find such opportunities in the CEE region. Therefore, studies analysing the potentials and costs of carbon dioxide reduction through technology improvement in the region have come into the limelight. While there are a few excellent studies in the region aimed at analysing climate change abatement potentials, they all embark on different assumptions, methodologies and boundary conditions. It is hence difficult, if not impossible, to compare and analyse the results of these studies across different authors, countries or time horizons. Consequently, the purpose of this paper is to place four leading studies on GHG mitigation through technology improvement from the CEE region into an internationally comparable framework. Four studies were selected from three countries, Poland, Hungary and Estonia, which are all the results of major national and international efforts to assess costs and potentials of GHG reduction. The paper places their assumptions, methods and final results into a framework which enables policy-makers and project designers to compare these across geographical and technological boundaries. Since other studies from around the globe have been analysed in this framework in the literature, this paper provides a vehicle for the findings of these four studies to be compared to others worldwide. In addition, the paper highlights a few areas where similar studies to be completed in the future in the region may be enhanced by incorporating features used in GHG mitigation research in other parts of the world.

Leaking electricity? Standby power losses in Bulgarian, Romanian and Hungarian residences

Climate Technology and Energy Efficiency – Dissemination ,,Best Practice" Experience – Seminar Proceedings – Ostritz, Germany, 8 – 9 December 8001

Risk perception by industrial radiographers: Hungary and the UK compared

Perceptions of risks from two groups of industrial radiographers, one from Hungary, (n = 45) and from the United Kingdom, (n = 29) were compared by the psychometric method. The comparison was made because both groups were at risk for high doses of ionizing radiation. We found the groups had similar demographic profiles but poor socio-economic conditions of Hungarians were associated with higher levels of emotional distress. Correlation HU-UK for personal and general risks were at a significant level for topics that included lifestyle and radiation risks. Perceptions of risks from radiation were small except for large personal risk from East European nuclear power plants. Knowledge of radiation risk intranationally was correlated positively with personal risk for UK radiographers and negatively for Hungarians. However, average overall risk perceptions from the same topic list for all radiographers did not differ significantly from a group (n = 1461) of UK citizens, though radiographer's risks from radiation were considerably greater. As a new lifesaving intervention it was proposed that radiation risk reduction could be achieved by genetic testing.

Drivers of market transformation: analysis of the Hungarian lighting success story

Over the past 5 years, Hungary has experienced one of the most remarkable market successes in a key energy-efficiency technology: compact fluorescent lighting. While market shares of compact fluorescent lamps (CFLs) were negligible half a decade ago, today residential CFL market penetration exceeds that in many industrialised economies, ranking Hungary among the eight countries in Europe with highest penetration rates. Since substantial efforts have been invested internationally to promote the proliferation of CFLs often with limited results, the understanding of the Hungarian success can bring us closer to an effective planning of programmes and policies designed to transform the markets of energy-efficient technologies around the world. Therefore, this paper's goal is to provide an insight into the driving forces which have contributed to this outstanding market success, and to investigate how the findings can apply in designing market transformation programmes aimed at increasing the penetration of cost-effective energy-efficient technologies internationally. The paper presents the results of nationally representative residential surveys and a large number of in-depth interviews with households, industry and other market participants. The market success is analysed in detail and differences in CFL penetration among the market segments provide an important clue for understanding which market barriers are the key in hampering market transformation, and which factors contributed to the overcoming of these barriers. The research suggests that the described market transformation occurred autonomously and rapidly. In the absence of major external influences, we attribute this market success to the combination of two key factors, among other contributing factors. First, the fierce market competition among CFL suppliers in Hungary has resulted in decreased prices and strong marketing campaigns, raising awareness substantially. This high awareness provided a fertile ground for an increase in CFL sales after drastic nominal electricity price hikes pressed consumers to start to care about cutting utility bills. Based on the findings about the various drivers of the market success the authors draw lessons for the design of effective market transformation programmes. In addition, we recommend an amendment to the commonly used taxonomy of market barriers prevailing in energy-efficient product markets. © 2001 Elsevier Science Ltd. All rights reserved.

Drivers of market transformation towards energy efficiency: analysis of a case study

Over the past 5 years, Hungary has experienced one of the most remarkable market successes in a key energy-efficiency technology: compact fluorescent lighting. While market shares of compact fluorescent lamps (CFLs) were negligible half a decade ago, today residential CFL market penetration exceeds that in many industrialised economies, ranking Hungary among the eight countries in Europe with the highest penetration rates. Since substantial efforts have been invested internationally to promote the proliferation of CFLs often with limited results, the understanding of the Hungarian success can bring us closer to an effective planning of programs and policies designed to transform the markets of energy efficient technologies around the world. Therefore, the paper’s goal is to provide an insight into the driving forces which contributed to this outstanding market success, and to investigate how the findings can apply in designing market transformation programs aimed at increasing the penetration of cost-effective energy efficient technologies internationally.The paper presents the results of a nationally representative residential survey, and a large number of in-depth interviews with households, industry and other market participants. The market success is analysed in detail and differences in CFL penetration among the market segments provide an important clue for understanding which market barriers are the key in hampering market transformation, and which factors contributed to the overcoming of these barriers. Based on the findings on the drivers of the market success the authors draw lessons for the design of effective market transformation programs.

Carbon mitigation in Hungary: Challenges for a sustainable national energy policy

While on a world-wide scale Hungary is a key greenhouse gas emitter neither on an absolute nor on a per capita basis, Hungary recognizes the significance of limiting its greenhouse gas emissions. This paper is based on the Hungarian contribution to a two-year, ten-country research effort, funded by UNEP, aimed at developing a state-of-the-art methodology for the understanding of the economics of greenhouse gas abatement. This paper concentrates on the challenges of the implementation of greenhouse gas mitigation measures. While Hungary has an important cost-effective potential for reducing the emission of carbon dioxide by improving energy efficiency, the implementation of this mitigation strategy is a complex and challenging task. The implementation and financing of energy efficiency measures require the concerted targeting of close to 4 million households, and a wide variety of actors, including banks, the industry, government, international and multilateral organisations, and NGOs. Thus, developing an implementation strategy requires a clear understanding of the existing structures, barriers, and experiences to date. This paper provides a strategic framework for the implementation of demand-side energy efficiency, and examines a case study, the tool of energy efficiency labelling and standards, within this framework.

Drivers of market trasformation towards energy efficiency: Analysis of a case study

Over the past 5 years, Hungary has experienced one of the most remarkable market successes in a key energy-efficiency technology: compact fluorescent lighting. While market shares of compact fluorescent lamps (CFLs) were negligible half a decade ago, today residential CFL market penetration exceeds that in many industrialised economies, ranking Hungary among the eight countries in Europe with the highest penetration rates. Since substantial efforts have been invested internationally to promote the proliferation of CFLs often with limited results, the understanding of the Hungarian success can bring us closer to an effective planning of programs and policies designed to transform the markets of energy efficient technologies around the world. Therefore, the paper's goal is to provide an insight into the driving forces which contributed to this outstanding market success, and to investigate how the findings can apply in designing market transformation programs aimed at increasing the penetration of cost-effective energy efficient technologies internationally. The paper presents the results of a nationally representative residential survey, and a large number of in-depth interviews with households, industry and other market participants. The market success is analysed in detail and differences in CFL penetration among the market segments provide an important clue for understanding which market barriers are the key in hampering market transformation, and which factors contributed to the overcoming of these barriers. Based on the findings on the drivers of the market success the authors draw lessons for the design of effective market transformation programs.

Lessons From The Restructuring Of The Hungarian Electricity Industry

Restructuring the monopolistic, state-owned, obsolete, and polluting utility industries of post-socialist economies poses a challenging ground for the utility deregulation wave travelling around the world. Utility restructuring in the region of Central and Eastern Europe (CEE) is unique from several perspectives, including the domination of foreign capital vs. national resources as the only feasible vehicle towards a drastic change in the industry; and the ambitious goals of harmonization with EU liberalization schedule to accelerate accession. It is also widely expected that deregulation will help bringing down world-record high energy intensities in these economies.Hungary has been the pioneer among economies in transition to unbundle, deregulate and privatize the utility industries and to make the first steps towards EU conform market liberalization within less than half a decade. The first stages of privatization and restructuring have been declared a success story in Western media. However, what is a success story from the perspective of foreign may be viewed differently from other viewpoints. The paper describes the process of the utility restructuring in Hungary, and examines its impacts from the economic, environmental and policy perspectives. The paper also gives an outlook to the CEE region, comparing the pathway of the pioneer Hungarian deregulation to that of the following countries in the region to restructure their energy sectors. However, the lessons to be learned from the Hungarian electricity industry restructuring are not only vital for other economies in transition in the line for utility deregulation, but are often universally applicable.

Globalnaia ekologicheskaia perspektiva, 2000

Globalnaia ekologicheskaia perspektiva, 2000 : doklad IUNEP o sostoianii okruzhaiushchei sredy v kontse tysiacheletiia

Residential Lighting in Lithuania

A wider use of compact fluorescent lamps (CFLs) offers a significant opportunity for Lithuania in reducing wasteful electricity consumption, and making progress towards retiring the Chernobyl-type Ignalina nuclear power reactors. We evaluate the conservation potential of compact fluorescent lamps for managing the residential electrical energy demand in Lithuania. The analysis is undertaken from the three separate perspectives of (1) the national economy, (2) the consumers and (3) the utilities. In our analysis we use the most recent available data on Lithuanian residential lighting. The costs of conserved energy of 15 and 23 W CFLs range from $0.007 to 0.031 per kW h depending on CFL price and assuming 4-hour daily lamp use. Replacing only the two most used 60 W incandescent lamps per household with CFLs would save 190 GW h of electrical energy for Lithuania annually worth 12 million US dollars at the long run marginal cost. We compare the current residential lighting situation in Lithuania with that in Hungary and Poland, where introduction of CFLs has been much more successful. We then discuss factors that could explain the much higher CFL penetration in Hungary and Poland, barriers to immediate large-scale introduction of CFLs in Lithuania, and policy instruments that could be used for promoting the diffusion of CFLs in the residential sector of Lithuania. We conclude that future success of CFL penetration in Lithuania will depend on aggressive information and promotion efforts by at least the CFL manufacturers, and/or by any of the stakeholder institutions (e.g. the state agencies responsible for energy and environment, electric utilities, international agencies, etc.). Given the small size of the Lithuanian market, it would make sense to “team up” with one or more neighboring countries to address the CFL issues.