No C 252/6 Official Journal of the European Communities 27. 9. 82 
Opinion on the Commission communication to the Council entitled 'investment in the rational 
use of energy' 
The text referred to the Committee has been published in Official Journal of the European 
Communities No C 107 of 28 April 1982, page 4. 
A. LEGAL BASIS FOR THE OPINION 
On 19 February 1982 the Council referred the abovementioned communication to the 
Economic and Social Committee in accordance with Article 198 of the Treaty establishing the 
European Economic Community. 
B. OPINION OF THE ECONOMIC AND SOCIAL COMMITTEE 
The Economic and Social Committee prepared its opinion on the above matter at its 199th 
plenary session held in Brussels on 30 June and 1 July 1982. 
The full text of the opinion is as follows: 
THE ECONOMIC AND SOCIAL COMMITTEE, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 198 
thereof, 
Having regard to the request made by the Council of the 
European Communities on 19 February 1982 for an 
opinion on the Commission's communication to the 
Council concerning investment in the rational use of 
energy and the Commission's recommendation to the 
Council concerning the encouragement of investment in 
the rational use of energy, 
Having regard to the decision taken by its Bureau on 
23 March 1982 instructing the Section for Energy and 
Nuclear Questions to draw up an opinion on the 
subject, 
Having regard to the opinion adopted by the Section for 
Energy and Nuclear Questions at its 72nd meeting held 
on 4 June 1982, 
Having regard to the oral report made by the rapporteur, 
Mr Delourme, 
Having regard to the discussions at its 199th plenary 
session held on 30 June and 1 July 1982, 
HAS ADOPTED THE FOLLOWING OPINION 
with no dissenting votes but with one abstention: 
INTRODUCTION 
The Committee welcomes the importance attached to the 
rational use of energy (RUE) by the Commission. This is 
an encouraging development in the thinking of the 
Commission. The definition of RUE used on page 1 (3) of 
COM(82) 24 final could confuse an energy substitution 
policy with RUE development. The Committee points out, however, that a more 
ambitious definition of RUE could be used. 
In the document 'The EEC and the energy problem', some 
interesting clarifications of the definition are made - the 
elimination of waste, the reduction of energy losses, and 
an improvement in conversion rates and use of energy. 
RUE may also involve limiting the energy content of each 
product and- making energy saving an integral part of 
physical planning. 
The definition of investment in RUE used by the 
Communication only refers to independent investment by 
an investor. 
Basically, the aim is to reorientate and increase 
investment in one part of the industry sector, rather than 
encourage an energy-saving strategy within the 
framework of energy policy. 
The Committee hopes that the range of Community 
measures can be extended further. 
I. 
THE KEY ROLE OF INVESTMENT IN THE RATIONAL 
USE OF ENERGY IN A STRATEGY FOR ENERGY AND 
INDUSTRY 
The Committee considers it essential to expand projects 
and programmes aimed at promoting the rational use of 
energy, as defined above. 
Furthermore, for the period 1981 - 1990, 80% (400 000 
million ECU) of national programmes will go towards 
energy production and 20% (100 000 million ECU) 
towards measures to increase energy efficiency (including 
investment in alternative sources). 
The Committee points out that the need to substitute 
other energy products for oil, an important element in 
27. 9. 82 Official Journal of the European Communities No C 252/7 
energy policy, does not lessen the need for an RUE 
policy. 
In addition to the special value of an RUE policy within 
the framework of energy strategy, it must be noted that 
RUE also has positive effects on the economy as a whole, 
especially the employment field. The communication 
stresses that measures in this area should lead to the 
creation of between 300 000 and 500 000 jobs in the 
Community by 1985, and this is to be seen as a 
conservative estimate! 
The Committee appreciates that estimates in this area are 
extremely difficult. 
The Committee notes that the Commission is not in a 
position to compare exactly the socio-economic impact of 
RUE investment with that of investment in electricity 
generation. 
The Committee hopes that the Commission will be able to 
make progress on these estimates and comparisons. 
To achieve a less energy-intensive type of growth at a time 
when financial resources are limited, it is necessary to 
select and channel investment wisely. 
It is fair to ask whether RUE investments compete with or 
should replace certain investments in supply. 
II. 
MEMBER STATES' POLICIES AND MEASURES 
INTRODUCED 
Almost 10 years after the first oil shock, the 
communication stresses that in industry, and especially in 
those industries which are large energy consumers, many 
projects with a potentially short payback period could be 
carried out. 
A combination of relatively simple measures (training of 
energy management specialists, straigthforward 
technological improvements, more rigorous planning of 
energy use) would allow many firms, including small and 
medium ones, to save 20 to 30% of their 
consumption. 
However, it should be noted that there is, as the 
Communication emphasizes, 'a marked preference for 
general measures to speed up investment in industry as 
against specific measures for investment in the rational 
use of energy'. 
The approach to investment in energy infrastructure 
varies from one country to another. Some countries 
foresee relatively heavy investment in port facilities for 
coal. The existing infrastructure needs to be modified and 
developed with a view to the best possible use of motive 
power, and proper handling and storage capacity needs to 
be ensured, before new heavy investment is made. 
In the building sector, the potential for economies is 
relatively high. The Communication estimates it at 
around 25 to 30% (') of present consumption in the 
sector. It should be noted that building renovation aimed 
at RUE is to a large extent dependent on the type and 
amount of financial and technical aid granted by the 
public sector. To achieve this end, an appropriate, 
comprehensive instrument is vital. 
The Committee draws attention to its opinion (*) of July 
1981 on the situation in the construction sector, and on 
the stress given to (a) gradual harmonization of building 
regulations (e.g. energy saving), (b) the need to use those 
materials available in Europe which most closely fit the 
need for energy conservation and economies and (c) the 
priority to be given to research in this field. 
The Committee stresses the major importance of the 
building sector, which is not brought out sufficiently. It 
asks to be informed about (a) obstacles to renovation (e.g. 
the renting system), (b) the technical aspects of the 
problem and (c) public aids. The insulation programme 
can only fully succeed with the support of large-scale 
public aid. The St-Geours report (II) proposed that 50 % 
of RUE investment be assigned to the residential and 
tertiary sector. 
The variations in Member States' aims and results need to 
be studied in more detail so that conclusions can be drawn 
at Community level. 
Coordination of energy policy, especially through joint 
action on RUE among the Member States, would play a 
crucial role, particularly, as the St-Geours report 
emphasized, in net job creation. 
Very little has so far been done to exploit the scope for 
RUE in the transport sector, which accounts for 25 % of 
Community consumption of petroleum products, and 
which depends on these products for 97% of its 
requirements. 
Insufficient mention is made of the importance of public 
transport and the improved energy efficiency which it can 
bring. Bearing in mind the many other aspects, the 
Committee hopes that a general study of the subject will 
be made, which the Committee will be able to 
consider. 
0) OJNoC 107, 28. 4. 1982. 
(') The situation in the Community's construction sector 
(OJNoC 230, 10. 9. 1981). 
No C 252/8 Official Journal of the European Communities 27. 9. 82 
The rational use of energy in agriculture should be 
considered as an important sector in direct and indirect 
energy use. 
The impact of physical planning on energy saving and the 
priority role to be assigned to research and development 
as proposed by the St-Geours (II) report, deserve more 
detailed consideration. 
The Committee reminds the Commission of the five 
Council recommendations of March 1976, proposing 
concrete measures for RUE. Two of these were: 
— promotion of public transport, 
— the operation of electrical appliances. 
It would be desirable to include these in the action 
programme and the recommendation. 
III. 
DIFFICULTIES AND OBSTACLES 
1. Difficulties and obstacles resulting from the general 
context in which decisions to invest in the rational use 
of energy are taken 
Given that investment projects are often expected to show 
a profit in the short term, the incentive to the rational use 
of energy is still very inadequate. 
Selectivity in RUE investment seems necessary, so that 
substitution of oil is not made the only main objective. 
The price of oil, bringing with it an overall rise in the price 
of energy has not done nearly as much to encourage RUE 
as might have been expected. 
One may wonder whether this is also due to the 
organization of the markets. 
An improvement in financial channels is needed to meet 
consumer needs. For example, banks and other financial 
institutions should be encouraged to look more 
favourably upon requests for loans and financing aids for 
energy saving measures. Political commitment in this area 
could improve many measures which at the moment are 
ineffective. 
The communication notes furthermore that there is an 
'absence of any clear perception of the forces which 
determine the formation of, and trend in, energy prices 
with a result that all energy investment initiatives are 
deferred'. 
Some economic operators lack adequate training and 
information. A practical awareness of RUE potential is needed to 
accompany direct technical and financial aid. Public 
authorities could play a leading role in the organization of 
RUE. 
The role of the gas and electricity companies as proposed 
in the document is not exclusive, as they represent only a 
part of energy distributors, are subject to brisk 
competition and have a varying legal status. 
Technical and economic barriers have emerged in the past 
when new products or equipment are launched on the 
market. 
The energy saving industry has not been immune to this. 
Such barriers greatly hinder the economies of scale 
potentially allowed by a Community-wide market and 
Community standards. 
It is desirable for the socio-economic groups concerned to 
take part in negotiations arranged as part of the proposed 
RUE drive. The achievement of greater decentralization 
in decision-making is also to be desired. 
2. Problems specific to certain energy-using sectors 
The position of industries which are large energy 
consumers has deteriorated, mainly as a result of the rise 
in energy prices, and sometimes through lack of 
investment in RUE. Where energy infrastructure is 
concerned, it should be noted that returns can usually 
only be guaranteed in the long term, and are often 
uncertain. 
Given its energy saving potential and other beneficial 
socio-economic effects, industrial and agricultural joint 
production has not been accorded serious attention. This 
could be due to competition between measures aimed at 
alternative supply and those aimed at RUE. 
There is considerable scope for RUE where public 
buildings are concerned. 
It is also regretted that greater attention has not been 
devoted to domestic consumption, particularly 
household electrical appliances. 
IV. 
ACTION PROGRAMME TO STIMULATE INVESTMENT 
IN THE RATIONAL JJSE OF ENERGY 
From what has been said so far, we may conclude that 
measures aimed at encouraging an increased commitment 
to RUE can take two forms: 
27. 9. 82 Official Journal of the European Communities No C 252/9 
— general measures to encourage investment in RUE, 
— measures specific to certain areas of activity. 
The intended goal is that those taking economic decisions 
should have clear information on price trends and 
developments in the energy market. 
In this context, the Committee feels that in principle it is 
important to prevent fragmentation and lack of 
coordination between the various sectors (public and 
private, industrial, financing) and the various measures 
taken. Coordination and coopereation have to be 
achieved in the RUE sector. The Committee feels that the 
measures contemplated should be the subject of clear, 
purposeful planning. It is deplorable that the present high 
interest rates may hamper projects which will only 
achieve economic viability in the long term, and may 
never do so. 
1. Improving the general context in which decisions to 
invest in the rational use of energy are taken 
(a) Supply guarantees should also be sought from coal 
exporting countries. 
(b) Once again, the Committee draws attention to the 
importance of undertakings from, for instance, gas 
and electricity companies on the prices which will be 
charged to industry, and also to private users. Such 
undertakings could also help encourage joint 
production. In general, the drive for RUE should be 
properly balanced between the various sectors of 
energy conversion and use. 
(c) Information technology, and the development of 
new means of communications in general, must 
allow improved training and information for certain 
operators. 
(d) Improvements are needed in some financial channels 
and financing arrangements. 
Public bodies must, with the private credit sector, be 
in a position to implement measures better geared to 
the special case of investment in RUE. However, the 
terms of financing proposed must be compatible 
with tax legislation. 
(e) The appearance of new technologies in this sector, 
both on the level of ideas and products, must be 
accompanied by the swift introduction of 
Community legislation. 
(f) Assessments of local factors (climate, natural 
resources, economic conditions) will provide specific 
information of assistance to RUE development. 2. Dealing with problems specific to certain sectors of 
the economy 
Problems in certain industrial sectors 
(a) Industries that are large energy 
consumers 
Measures to boost RUE which are both technical and 
economic, involving firstly combined production 
(electricity/heat), but also the introduction of tariffs 
which will encourage this type of production. 
It would be in the interests of public authorities to 
encourage major investment programmes in RUE and 
primary energy conversion by negotiating contracts with 
industries which are large energy consumers and by 
involving the socio-economic groups concerned in these 
negotiations. 
(b) Small/medium firms and local 
authorities 
Small and medium firms should be made more aware of 
RUE by means of appropriate technical aid. 
(c) Renovation of buildings 
The housing sector is another important branch of RUE 
policy. 
The development of RUE in the home will be greatly 
influenced by financial and technical aid both to tenants 
and owners, while remaining linked to the level of 
personal disposable incomes. This type of RUE provides 
a major market for industry. A legal basis is sometimes 
necessary for the possible role of electricity companies. 
First and foremost, the new building sector (and 
especially multi-unit developments) provides a prime 
target for an RUE policy, especially at a time when most 
European cities are faced with a shortage of housing 
which is suitable for modern needs. 
(d) Demonstration programmes 
A 'certification of performance' is needed in the field of 
new RUE technologies, as it is in similar new fields. 
Certification of this kind is essential for the marketing of 
new techniques. 
For this reason, demonstration programmes are of great 
use, and make it possible to coordinate industrial policy 
with energy policy. 
The St-Geours report had stressed the importance of 
R&D, and the Committee had noted in its opinion of 
No C 252/10 Official Journal of the European Communities 27. 9. 82 
26 February 1982 0) that R & D in RUE should be 
included in the list of energy investments. 
(e) The implementation of an RUE policy must be 
accompanied by performance monitoring, so as to make 
it possible in the long run to assess the results achieved 
and, if necessary, revise'decisions. 
3. Financial incentives for certain types of investment 
The Commission feels that some types of investment 
mentioned in this report deserve special priority. 
3.1. Investment in the joint production of heat and 
electricity and the organization of remote heating 
from industrial waste heat and from solid and 
residual fuels 
Investment aimed at using waste heat is of particular 
value. 
However, local conditions will have to be taken into 
consideration, to guarantee some degree of protection for 
the environment and society. 
3.2. Investment in deriving energy from certain types of 
urban, agricultural and industrial waste 
3.3. Investment in the conversion to coal of fuel oil 
boilers used in industry 
While bearing in mind the need to protect the 
environment, one must also remember that conversion of 
this kind involves a real saving in energy. 
3.4. Investment in the processing of imported coal 
The installation of large-scale port facilities for the 
storage and processing of coal should be viewed with 
caution, given the doubts which still exist regarding 
reliability of supplies. 
In investment aid, a balance should be found between the 
different sectors of RUE. 
3.5. The Community could also encourage measures 
to promote the development of Community energy 
sources. 
CONCLUSIONS 
The Committee welcomes the analysis contained in the 
communication, which would not have been possible 
without the outstanding work of the panels of experts 
chaired by Mr St-Geours, set up on the initiative of the 
Commission. 
(») OJ No C 138, 9. 6. 1981, p. 33. The Committee notes that these reports have encouraged 
a favourable development in the aims of the Commission, 
which the communication bears out. 
The Committee hopes - all the more so as it is now nine 
years since the energy crisis - that the communication 
will quickly lead to directives laying down a 
comprehensive set of measures which are themselves 
balanced and which strike the right balance between the 
components of supply. 
THE WORK PROGRAMME 
The Committee notes that the annexed work programme 
could better reflect the balance suggested in the analysis, 
especially as regards domestic consumption, transport 
and social effects. 
Some criteria could be added to the facts and figures 
illustrating the potential. 
Political commitment to RUE in line with that which has 
developed in supply, is needed. 
RUE could be seen more as a part of industrial and 
employment policy, helping to stimulate new growth. 
THE RECOMMENDATION 
First of all, the Committee would like to state its 
preference for a Directive, rather than a 
recommendation. 
Excessive centralization of decision and information 
machinery undoubtedly presents a major obstacle to the 
development of an RUE policy. 
1. Increased investment in RUE seems desirable. The 
source of it has still to be specified. 
2. If a 50 % saving is to be feasible, there must be a 
balance: (a) between supply and demand and (b) within 
RUE. 
3. The drive for realistic pricing, transparency of the 
market and coherence are indeed the aims of energy 
policy, but one is unfortunately forced to conclude that 
for many years progress has been very slow. 
Moreover, high energy prices have hardly acted as a 
stimulus to an RUE policy, but rather to the search for 
alternative sources. 
27. 9. 82 Official Journal of the European Communities No C 252/11 
Support for a tariffs policy for gas and electricity must not 
help industry alone, but consumers in general. 
Adaption of the financial channels to favour RUE investment must not lead to tax distortion. It must be 
warranted by energy and economic criteria which take 
account of the employment aspect. 
Done at Brussels, 30 June 1982. 
The Chairman 
of the 
Economic and Social Committee 
Tomas ROSEINGRAVE 
APPENDIX 
to the opinion of the Economic and Social Committee 
Rejected amendment 
The following amendment, tabled in accordance with the Rules of Procedure, was defeated during the 
discussion. 
Page 16, point 3.3: Add the following: 
'The conversion of oil-fired power stations to coal firing is to be welcomed from the point of view of 
diversification. 
From the energy conservation angle it would be better to replace larger power stations by smaller 
generating units spread over the country.' 
Voting 
For: 38, Against: 52, Abstentions: 11.