Press Release: 7 European organisations succeed in creating an open-source tool to estimate the multiple impacts of energy efficiency

Amsterdam, February 2024 – Given the EU’s target of a climate-neutral Europe, particularly following the COVID-19 crisis and the Russian invasion of Ukraine, both of which revealed gaps within Europe’s energy system, energy efficiency is now becoming recognised as a crucial element and a priority consideration in future investment decisions within the Union. Nevertheless, significant potential for improving energy efficiency exists in all sectors. In order to make it more attractive, highlighting and quantifying the additional value of energy efficiency investments, considering the resulting non-energy impacts, or Multiple Impacts, could help close the energy efficiency gap and facilitate energy-related policy-making ad various governmental levels. As such, the MICAT project has successfully released the MICATool to help policymakers and energy experts quantify the economic, social, and environmental impacts of energy retrofits. With its comprehensive features characterised by a systematic approach, flexibility, and a dedicated focus on societal perspectives, the MICATool facilitates the nuanced evaluation of the genuine value of energy efficiency.

Energy efficiency measures can have positive and negative effects to society beyond the usual measure of energy savings. These effects, called multiple benefits, co-benefits, non-energy benefits, ancillary benefits or multiple impacts of energy efficiency, cover a broad spectrum of environmental, social, and economic aspects. A few environmental impacts of energy efficiency in buildings include lower CO2 emissions, contribution to EU Renewable Energy Directive (RED) targets, and less air pollution. Examples of social impacts are reduced energy poverty, better indoor air quality, and health improvements. Finally, economic impacts include, but are not limited to, enhanced energy security, higher asset values, and a rise in economic output and jobs. However, it should be noted that not all impacts of energy efficiency are positive. Among other things, energy efficiency can reduce the potential for demand response, negatively impacting the expansion of renewable energy sources.

The relevance of multiple impacts is that they can help frame the relevancy of energy efficiency benefits for citizens. For instance, while energy efficiency is mainly seen as an approach to reduce CO2 emissions and energy costs in Germany, Poland advertises many of its boiler replacement schemes as a solution to tackle its problems with air pollution. Multiple impacts can quantify these different motivations, in the above-mentioned cases, CO2 emissions, energy cost cuts, reduction in air pollutants, and expected related health benefits, thereby highlighting energy efficiency itself as a versatile resource with diverse effects.

Addressing the needs of policymakers with the MICATool

The assessment and consideration of multiple impacts has now been enshrined in EU legislation in the recast Energy Efficiency Directive (EED), and therefore, as a vital component of the new Energy Efficiency First Principle, it paves the way for mainstream use of the concept. The Principle therefore levels the playing field between energy efficiency and supply-side technologies (i.e., power plants or renewables) by mandating the consideration of demand-side solutions for major energy-related projects.

To enable such assessments, the EU-funded MICAT project (Multiple Impacts Calculation Tool) has developed a free, easy-to-use, and scientifically sound online tool, called the MICATool. The MICATool enables holistic analyses of multiple impacts of energy efficiency at European, national, and local levels to strengthen and accelerate an affordable and just sustainable energy transition. It grants policymakers, practitioners, and evaluators the ability to conduct simplified analyses for different data and policy scenarios to compare and assess the relevance of the multiple impacts, thereby strengthening reporting and monitoring at the three governance levels. The MICATool offers a range of indicators to aggregate Multiple Impacts, including total monetised value, various CBA metrics, and marginal abatement cost curves. The tool includes sensitivity analyses, allowing users to modify parameters and evaluate the robustness of CBA results. Emphasizing its versatility, it integrates core scenarios and framework data, while also providing the flexibility for users to input their own data.

To ensure the MICATool caters to the needs of its users, the project has held three rounds of workshops with officials and relevant stakeholders. These took place:

• At the EU level in the three pilot countries of Italy, Poland and Germany
• With the three pilot cities of Vitoria-Gasteiz, Tartu and Calvià.

As such, typically available data, relevant use cases, essential functions, intuitive tool structures, and many more aspects that were priorities for stakeholders have been considered and integrated into the MICATool to serve its users best. Moving forward, policymakers can use the results from the MICATool to report on target progress at the EU level, for Integrated National Energy and Climate Plans (NECPs) or other reporting requirements at national levels, as well as in local reporting on energy efficiency within Sustainable Energy and Climate Action Plans (SECAPs). Policymakers can also use the 10 policy briefs released over the last year to further inform their decision making.

Following three years of work, the MICAT project has successfully developed a tool to quantify and monetise multiple impacts, and although funding for the project ended in November 2023, the granted follow-up project SEED MICAT (Supporting Energy Efficiency Deployments with MICAT) will ensure that the MICATool will be maintained and enhanced.

Download the full press release, here!