COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the document Proposal for a Regulation of the European Parliament and of the Council setting a framework for energy efficiency labelling and repealing Directive 2010/30/EU
Date: 2015-07-15
Institutions: Directorate-General for Energy, European Commission
Subjects: European standard, consumer information, energy consumption, energy efficiency, energy saving, environmental impact, environmental protection, household electrical appliance, labelling

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   EN 

   EUROPEAN COMMISSION  Brussels, 15.7.2015  SWD(2015) 140 final   COMMISSION STAFF WORKING DOCUMENT  EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT  Accompanying the document Proposal for a Regulation of the European Parliament and of the Council setting a framework for energy efficiency labelling and repealing Directive 2010/30/EU  {COM(2015) 341 final} {SWD(2015) 139 final}  
 
 
EXECUTIVE SUMMARY OF IMPACT ASSESSMENT 

1.  Policy context 
1.  The  Energy  Labelling  Directive  requires  the  Commission  to  review  the  effectiveness  of 

the Directive and its delegated acts by 2014. 

2.  The  Ecodesign  Directive  required  the  Commission  to  review  the  effectiveness  of  the 
Directive  and  its  implementing  measures  by  2012.  That  review1  concluded  that  no 
immediate revision was necessary, but  that  the Directive could  be reviewed again along 
with  the  review  of  the  Energy  Labelling  Directive,  since  the  effects  of  ecodesign 
implementing  regulations  and  energy  labelling  delegated  regulations  applicable  to  the 
same energy-related products are often linked and complementary. 

2.  Evaluation and problem definition 
3.  The Energy Labelling and Ecodesign Directives were created to address the basic problem 
that products can have a negative impact on the environment depending on how they are 
made, used and disposed.  

4.  The  Ecodesign  Directive  pushes  the  market  by  banning  the  least  efficient  products.  The 
Energy Labelling Directive encourages consumers to buy more energy efficient products 
by  informing  them  about  the  energy  use  of  products  through  an  energy  label.  The 
requirements  for  specific  energy-related  products  (such  as  washing  machines  or  electric 
motors)  are set  through  delegated  acts  (for  energy  labelling) and  implementing  acts (for 
ecodesign). 

5.  The scope of the evaluation does not go into the question of whether energy savings are 
more or less cost-effectively achieved in other sectors. In order to achieve decarbonisation 
and energy targets, measures in all sectors are necessary for delivering energy savings and 
the costs to achieve the energy savings through ecodesign and energy labelling are equal 
to or less than zero. 

6.  The  focus  is  on  the  framework  Directives  and  not  on  the  individual  implementing 
measures,  which  are  subject to  their own  impact  assessment  process.  Any  new  products 
that may in future be addressed under ecodesign and/or energy labelling will be identified 
in  the  2015-2017  Working  Plan,  which  the  Commission  plans  to  adopt  as  part  of  the 
Circular Economy package later in 2015.  

7.  There are potentially other policy  measures that could increase the efficiency of energy-
related  products,  such  as  fiscal  measures,  incentive  schemes,  etc.  However,  this  impact 
assessment addresses the specific problems that have arisen in the implementation of the 
two Directives. In wider context, energy labelling and ecodesign policies have shown to 
work well across the world. 59 non-EU countries have adopted energy labels, half of them 
with  designs similar to the EU label.  At least 45 countries outside the EU have  adopted 
minimum energy efficiency requirements for products. 

8.  To date 24 ecodesign implementing regulations have been put in place. Products covered 
range from household appliances, such as fridges, lamps and boilers, to professional and 

1 COM(2012) 765 final 

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industrial  equipment,  such  as  electric  motors  and  fans.  In  addition,  12  delegated 
regulations on energy labelling now ensure that a range of mostly consumer products must 
be sold with an EU energy label attached. 

9.  In terms of energy savings, the ecodesign and energy labelling measures in place to date 
are  estimated  to  save  175  Mtoe  primary  energy  per  year  by  2020.  For  environmental 
aspects other than energy consumption there has been less measureable impact so far. The 
energy savings are estimated to represent 100 billion euro per year in 2020, equivalent to 
465 euro per household.  

10. Apart from environmental and monetary benefits, the setting of requirements at EU level 
also  benefits  industry.  An  EU  harmonised  regulatory  framework  brings  down  costs  for 
manufacturers and drives innovation in energy efficiency. 

11. However, evaluation carried out for this impact assessment2 has shown that, in particular, 
the introduction of the A+ to A+++ classes has reduced the effectiveness of energy labels. 
The A+++, A++, A+ classes added during the 2010 recast of the Directive have reduced 
the effectiveness of the label in persuading consumers to purchase more efficient products. 
The new label scale is understandable for consumers, but it has reduced their willingness 
to pay more for more efficient products. They are less motivated by a difference between 
A+  and  A+++  than  by  a  difference  between  C  and  A.  To  address  further  technological 
advancement rescaling of the label classes is necessary when a large share of the market 
reaches class A+++. Rescaling has not yet been undertaken, as no agreed method exists. 
Another  problem  for  energy  labels  is  that  there  is  an  increased  sale  of  larger  models, 
which  are  efficient  and  thus  achieve  a  high  energy  class,  but  nevertheless  have  a  much 
higher absolute consumption than smaller appliances of the same type. 

12. There  are  additional  problems  common  to  ecodesign  and  energy  labelling.  Firstly,  non-
compliance  with  ecodesign  and  labelling  requirements,  in  part  related  to  weak 
enforcement  by  national  market  surveillance  authorities.  Secondly,  a  number  of  product 
regulations have a low level of ambition and, thirdly, a long rulemaking process, leading 
to outdated technical and preparatory work at the time of policy decisions. 

13. A final problem is related predominantly to ecodesign: environmental impacts other than 

use-phase energy consumption could receive more attention. 

3.  Subsidiarity  
14. Measures on efficiency of products taken by Member States would create barriers to the 
free movement of goods in the EU and unnecessary burden for industry to comply  with 
different  sets  of  rules  in  each  Member  State.  Acting  at  the  EU  level  is  the  only  way  to 
ensure that requirements and labels for products placed on the market are the same in all 
Member States. 

2  Ecofys,  Evaluation  of  the  Energy  Labelling  Directive  and  specific  aspects  of  the  Ecodesign  Directive,  June 
2014; London Economics, study on the impact of the energy label – and of potential changes to it – on consumer 
understanding and on purchase decisions, October 2014. 

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4.  Objectives  
15. The  specific  objective 

to  reduce  energy  consumption  and  other  significant 
environmental impacts of products by ensuring consumers are informed in a relevant and 
easy-to-understand way and allowing industry to transform environmental challenges into 
economic opportunities. 

is 

5.  Description of policy options and methodology 

16. The  following  policy  options  to  improve  the  energy  labelling  and  ecodesign  framework 
are considered, listed in order of increasing degree of ambition to address the problems: 

1.  New non-legislative action 
1+. New non-legislative action plus legislative improvements for energy labelling 
2.  Significant legislative reform of both ecodesign and energy labelling 
3.  Comprehensive  reform  of  ecodesign  and  energy  labelling  extending  the  scope  to 
non-energy-related products and centralising market surveillance at EU level. 

17. Each  of  the  policy  options  consists  of  a  number  of  measures  to  address  the  different 

problems identified, with a different degree of ambition. 

18. The policy options allowing legislative changes to energy labelling are the only ones that 
can address the problem of the energy label layout. Three sub-options, in addition to the 
current A+++ to D label, for the label scale layout are considered: 

a.  A-G label, of which the classes need rescaling every 5-10 years 
b.  Numeric label (e.g. 40-100, with room to add classes 0-30 on top) 
c.  Reverse numeric label (e.g. 7-1, with room to add classes 8, 9 etc. on top) 

19. The  problem  related  to  larger  models  is  addressed  by  the  alternative  measures  of  more 
emphasis  on  the  absolute  energy  consumption  on  the  label  (option  1)  and  requiring  for 
larger appliances a higher efficiency to reach a certain label class (options 1+, 2 and 3). In 
addition, providing monetary information in addition to the energy label is a measure that 
would  further  address  this  problem  for  product  groups  with  high  energy  consumption 
(options 1+, 2 and 3). 

20. The  three  problems  common  to  ecodesign  and  energy  labelling  are  addressed  by  a 
mandatory product registration database (in option 1+ only for labelling, in options 2 and 
3  for  both  labelling  and  ecodesign),  providing  the  information  needed  to  improve 
enforcement and the rule making process, and to some extent  addressing the problem of 
low levels of ambition. The alternative measure of a study collecting data (option 1; and in 
option  1+  for  products  covered  by  ecodesign  but  not  by  labelling)  addresses  the  same 
problems although to lesser extent and not for enforcement. 

21. Additional measures to address the problem of low levels of ambition are i) using learning 
curves to determine the least life cycle cost at which requirements are set (options 1, 1+ 
and  2)  and  ii)  changing  the  least  life  cycle  cost  requirement  to  a  significantly  more 
ambitious 'break-even point' requirement (option 3). 

22. Additional  measures  to  address  non-compliance  and  weak  enforcement  are  supporting 
joint  surveillance  actions  through  EU-funded  projects  (options  1,  1+  and  2),  legal 

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alignment  with  the  Commission's  proposal  for  a  new  market  surveillance  regulation3 
(options  1+  and  2),  streamlining  legal  provisions  of  the  Energy  Labelling  Directive 
(options 1+, 2 and 3), requiring third party certification for all product groups (options 2 
and 3) and centralising market surveillance at EU level (option 3). 

23. The problem concerning other environmental impacts is addressed by extending the scope 
to non-energy-related products for which such impacts dominate over energy use (option 
3)  or,  alternatively,  by  reviewing  and  updating  the  ecodesign  analysis  methodology 
('MEErP') to better address material efficiency impacts of energy-related products (options 
1, 1+ and 2). 

24. The  analysis  of  impacts  was  supported  by  the  use  of  a  model  that  incorporates  the  data 
from  all  preparatory  studies  and  impact  assessments  done  for  products  covered  by 
ecodesign  and  energy  labelling.  The  model  addresses  only  energy-related  products  and 
therefore  the  extension  of  the  scope  to  other  products  in  option  3  was  assessed 
qualitatively.  A  specific  study  tested  consumers'  understanding,  and  the  effect  on  their 
purchase decisions, of the different label layouts. All options are compared to a baseline in 
which  implementation  of  ecodesign  and  energy  labelling  would  continue,  but  without 
being able to address the problems identified. 

6.  Analysis of impacts 

25. All options further reduce the energy use of products to a significant extent, as shown in 
the overview tables at the end of this document. The higher the degree of ambition of the 
measures in the options to address the problems, the higher the additional energy savings. 

26. In terms of consumer understanding, alphabetic label scales (i.e. A+++ to D and A to G) 
are clearly better understood by consumers than numeric labels. In terms of their effect on 
consumer purchase decisions, the A-G label scored best in persuading consumers to buy 
more  efficient  products,  with  the  reverse  numeric  label  second  best,  while  the  numeric 
label scored lower than the current A+++ to D label. 

27. All  options  reduce  other  environmental  impacts  such  as  greenhouse  gas  emissions, 
nitrogen oxide emissions and water use. However, apart from the reduction of greenhouse 
gas  emissions,  which  is  closely  linked  to  the  energy  savings,  the  reduction  of  other 
environmental  impacts  is  modest  compared  to  the  energy  savings.  Only  the  option  that 
extends the scope of the Directives from energy-related products to other products has the 
potential  to  address  other  environmental  impacts  more  rigorously.  However,  a  range  of 
environmental  impacts  of  products  other  than  energy-related  products  are  already 
addressed through other legislation. 

28. The main economic impact is on consumer expenditure (sum of purchase cost and energy 
cost during usage), which is sensitive to energy prices. At an energy price increase of 4% 
per year up to 2030, consumer expenditure is lower for all options than in absence of new 
actions and this benefit is higher for options with a higher level of ambition. At an energy 
price increase that falls to 0.5% per year after 2020, consumer expenditure is also lower 

3 COM(2013) 75 final 

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for  all  options  than  in  absence  of  new  actions,  although  to  a  lesser  extent,  and  the 
monetary savings are similar for all options. 

29. The trend for commercial revenues follows the trend of the energy savings for all options: 
the higher the level of ambition of the measures, the  more commercial revenues. This is 
because,  except  for  electronic  products,  more  efficient  products  are  relatively  more 
expensive  in  terms  of  purchasing costs.  The  revenues  affect  larger  businesses  and  small 
and  medium  sized  enterprises  in  the  same  way.  Approximately  80-85%  of  the  revenues 
contribute to EU GDP. For the lighting sector revenues decrease because of a further shift 
in  sales  to  lamp  types  that  have  longer  lifetimes  and  consequently  need  less  frequent 
substitution.  The  space  heating  sector  accounts  for  a  large  share  of  the  increase  in 
revenues, linked to a shift to geo-thermal heat pumps. If prices for geothermal heat pumps 
were to decrease further than assumed, additional revenues for all options would be less. 

30. The additional administrative burden (on top of that for complying with the existing legal 
framework)  for  business  is  considerable  in  the  case  of  significant  legislative  reform 
(option 2) and high in the case of comprehensive reform (option 3). In addition, there is a 
recurring administrative burden of 50 million euro for manufacturers and 10 million euro 
for  dealers  every  5-10  years  from  the  rescaling  of  the  sub-option  introducing  the  A-G 
label. The administrative costs for registering products in option 1+ are estimated at  1.5 
million  euro  per  year  for  the  entire  industry.  However,  given  that  compliance  is 
mandatory,  manufacturers  and  dealers  can  pass  these  costs  for  rescaling  and  registering 
(combined approximately 2 to 5 eurocent per labeled product) on to consumers for whom 
these costs are offset many-fold by the monetary benefits resulting from the A-G label's 
superior performance as a basis for consumers to identify and buy more efficient products. 

7.  Conclusions 

31. The  option  of  only  non-legislative  action  (option  1)  can  bring  significant  further  energy 
savings  and  addresses  several  of  the  problems.  However,  it  cannot  address  the  crucial 
problem of the energy label scale layout, for which the analysis shows that there are better 
solutions compared to the current A+++ to D label.  

32. The options of significant (option 2) and of comprehensive (option 3) legislative reform of 
both ecodesign and energy labelling would achieve the highest energy savings. However, 
these  options  could  create  disproportionate  obstacles  with  regard  to  international  trade, 
because  they  include  third  party  certification  for  all  products.  Furthermore,  for  the 
extension of the scope beyond energy-related products in option 3 it is not obvious that the 
principle  of  proportionality  is  respected:  ecodesign  and  energy  labelling  may  not  be  the 
right instrument for such products and for a number of product groups this measure would 
overlap with other environmental policies. It thus appears to go beyond what is necessary 
to achieve the identified objectives. 

33. The  option  of  non-legislative  action  plus  legislative  improvements  for  energy  labelling 
(option 1+) appears to be the optimal one from the perspective of all impacts combined. It 
addresses  all  identified  problems  to  a  full  or  significant  extent  and  has  limited 
administrative burden. It would include the sub-option of the A-G label, which is superior 
to the other options for the label layout. Option 1+ including the A-G label is estimated to 
save an additional 47 Mtoe primary energy per year in 2030. 

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Overview tables with key results of the modelling for 2030 

Results excluding any impact from 
change in label layout 

Environmental impacts 

Energy use (TWh primary/year) 

(Mtoe primary/year) 

GHG (Mt CO2-eq./year) 

Economic impacts 

Consumer expenditure at 4% energy price 
escalation rate (billion € per year) 

Consumer expenditure at 0.5% energy 
price escalation rate from 2020 (billion € 
per year) 

Commercial revenues (billion € per year) 

Administrative burden  

 Total administrative burden (million € 
per year) 

Option 1 

Option 1+ 

Option 2 

Option 3  

New non-legislative action 

New non-legislative action + 
legislative for energy labelling 

Significant legislative reform 
ecodesign + energy labelling 

Extending the scope and to 
centralise market surveillance 

-310 

-27 

-45 

-20 

-8 

+16 

+3 

-490 

-42 

-75 

-27 

-9 

+30 

+6 

7 

-580 

-50 

-87 

-32 

-10 

+35 

better than option 2 

better than option 2 

at best similar to option 2 

at best similar to the other 
options 

not available 

+145 

+500-1000 

 
 
 
 
Additional impacts of change in label layout 

A-G label 

numeric label 

reverse numeric label  

Environmental impacts 

Energy use (TWh primary/year) 

(Mtoe primary/year) 

GHG (Mt CO2-eq./year) 

Economic impacts 

Consumer expenditure at 4% energy price 
escalation rate (billion € per year) 

Consumer expenditure at 0.5% energy price 
escalation rate from 2020 (billion € per year) 

Commercial revenues (billion € per year) 

Administrative burden 

-62 

-5 

-9.6 

-3.7 

-1.2 

+3.7 

+17 

+1 

+2.6 

+1.0 

+0.3 

-1.0 

-36 

-3 

-5.5 

-2.2 

-0.8 

+2.1 

 Administrative burden for business (million 
€) 

60 
(every 5-10 years) 

60 
(only once) 

60 
(only once) 

8