European Commission

Intelligent Energy Programme

Work Package 5
Report presented to
Intelligent Energy
Executive Agency by
Handbook for the design and
IIIEE at Lund University
evaluation of TWC schemes
on behalf of
the EWC team

Task Report Work Package 5

March 2007

E I E / 0 4 / 1 2 3 / S 0 7 . 3 8 6 4 0
 Project description
The EuroWhiteCert project will support the conceptual and technical development of tradable white
certificates systems covering energy savings and energy efficiency. In order to promote the introduction of
such systems in the ecologically and economically most beneficial way at the European level,
recommendations will be made for handling the interactions of white certificates and their possible
integration with other existing and planned tradable certificate and permit systems (such as green
certificates, cogeneration certificates), with other policy tools for sustainable energy, as well as with the
EU ETS and the JI and CDM schemes.
The project involves a critical evaluation of the experiences with already established certificate schemes in
the energy sector and explores the practical implementation of a white certificate scheme by developing a
uniform measurement and verification methodology, certifying existing projects, identifying a set of
alternative market participants and by eliciting voluntary demand among these.
The EuroWhiteCert project is supported within the Intelligent Energy for Europe (EIE) Programme of the
European community (contract no. EIE/04/123/S07.38640). The kick-off meeting was in April 2005 and the
project will last till April 2007.

Project partners

www.eerg.it www.energyagency.at www.ademe.fr www.apat.gov.it www.armines.net www.ceu.hu

www.cres.gr www.ecofys.com www.eneffect.bg www.esdb.bg www.esd.co.uk www.iiiee.lu.se
www.isr.uc.pt www.vatt.fi www.zsw-bw.de

www.eurowhitecert.org

Report authors:
Lena Neij lena.neij@iiiee.lu.se
Luis Mundaca luis.mundaca@iiiee.lu.se

1
The sole responsibility for the content of this document lies with the authors. It does not represent the opinion of the
European Communities. The European Commission is not responsible for any use that may be made of the
information contained therein.

2
 Introduction
This handbook, and deliverable of the Euro White Cert (EWC) project, is developed with the purpose to
1
give guidance in how to analyse, design and evaluate Tradable White Certificates (TWC). The handbook
aims not only at supporting the conceptual and technical development of TWC schemes, but it also
addresses the underlying policy question of whether this market-based approach is justified.
The handbook, or guideline, needs to be seen as a departure point that needs to be followed by several
analyses that will require data, resources and evaluation methods. This departure point sets the
requirement of identifying the policy objective, alternative policy instruments, and the evaluation criteria of
political interest. We suggest that different designs of TWC schemes should be outlined, analysed and
compared to alternative policy instruments aiming at the same objective. These studies should then seek
to answer, for example, the following questions:
• Is a TWC scheme the right or a plausible policy option?
• Can a TWC scheme achieve a given policy goal with lower or higher costs than other(s) existing
instruments?
• What is the additional value or benefit that a TWC scheme brings to the existing portfolio of policy
instruments?
This handbook is designed to help policy makers, programme managers, analysts, and planners to carry
out the following tasks in evaluating and designing TWC schemes:
• State research questions relevant for the evaluation of TWC schemes
• Identify an appropriate analytical framework and methods to be used
• Identify data requirements
• Set realistic expectations among the stakeholders of the evaluation

The handbook has been structured using the following sections:

1) Problem/opportunity analysis and need for assessment
2) Definition of policy objective and alternative policy incentives
3) Definition of evaluation criteria
4) Design of a TWC scheme, including “flexibilities”
5) Baseline definition/setting
6) Evaluation methods
7) Concluding remarks

1
Please notice that in this report we do not differentiate a national TWC scheme from an EU-wide TWC scheme. This is due to the
fact that most of the findings and policy recommendations addressing TWC schemes are applicable to both, see task report WP5.

3
 1. Problem/opportunity analysis and need for assessment
The identification of the problem to be tackled is crucial to any design and evaluation of policy instruments.
The basic rationale of public policy is to solve problems or satisfy needs for a given situation identified as
problem or opportunity that requires public intervention. In other words, the policy process aims at
enhancing society’s welfare. The early analytical process should demonstrate the need for public
intervention to support justifications for any initial policy proposal. The analysis of the problem should also
identify critical factors influencing or hampering any process of change as well as analyze the cause-effect
relations between the factors identified and the interests and motivations of the actors.
Based on the problem identified, different policy objectives can be set; in this report we will focus on policy
objectives relevant for the implementation of a TWC scheme, i.e. energy efficiency, reduction of CO2
emission, secured energy supply and reduced fuel poverty (see chapter two). At the EU level, increasing
2
attention has been given to improve energy efficiency. It is argued that business-as-usual is not enough
to realize cost-effective energy efficiency potentials (e.g., up to 20%) so public intervention is needed.
However, by increasing energy efficiency, multiple policy objectives are tackled. Increased energy
efficiency is seen as a cost-effective way to reduce atmospheric pollutants, reduce energy intensity,
increase security of energy supply, encourage development of energy service markets, foster
competitiveness, etc. Among the variety of policies and measures, TWC schemes arise as a policy option
to be thoroughly evaluated.

2. Definition of policy objective(s) and alternative policy incentives

Once the causes and impacts of the problem are understood – albeit with an inherent level of uncertainty
– it is time for policy makers to define the primary policy objective and to design and implement a policy
instrument, or package of policy instruments, which provides the incentives (i.e., ‘carrots or sticks’) for
private actors to react (e.g., internalise externalities) in favour of the policy objective. Below we describe
some alternative, or complementary, policy instruments for fulfilling the following policy objectives3:

• Energy efficiency4
• Secured energy supply
• CO2 emission reductions
• Reduce fuel poverty

2
See for example, European Commission (EC) Directive on Energy End-use Efficiency and Energy Services. COM(2003) 739 final.
Available at http://europa.eu.int/eur-lex/lex/LexUriServ/site/en/com/2003/com2003_0739en01.pdf [Accessed June 2006], and
European Commission, Action Plan for Energy Efficiency: Realising the Potential. COM(2006)545 final. Available at
http://ec.europa.eu/energy/action_plan_energy_efficiency/doc/com_2006_0545_en.pdf [Accessed December 2006]
3
It is worth to mention that all policy goals presented above can be mutually complementary as increasing energy efficiency in itself
entails multiple purposes (e.g., increase security of energy supply, reduce CO2 emissions and other atmospheric pollutants, etc.) and
thus serve as building block between energy, climate change and other related policies (e.g., public health). Based on this, the
authors of this paper emphasize that it is not so simple to draw a clear division line among the above-mentioned policy objectives.
Several linkages exist, indeed.
4
Another policy goal of interest, and relevance of introducing TWC, would be to save energy. In this report we choose to define
“energy savings” as a) lower energy consumption by keeping satisfied energy service demands (meaning increasing energy
efficiency) and b) lower energy consumption by reducing energy service demands or cutting down energy activities. For the latter, a
straight example could be consuming less energy that will decrease a given output production. Most policy instruments are trying to
capture energy savings through energy efficiency. Only a few policy instruments actually focus on cutting down energy activities,
such instruments include information campaigns focused on turning of the lighting, lowering heating temperatures etc. In this report
we only consider the objective of energy savings as through the objective of energy efficiency.

4
If the given policy objective is energy-efficiency, several alternative policy instruments, including TWC, will
be available for fulfilling the objective; policy instruments such as informative policy instruments, economic
instruments and command-and-control instruments. Policy instruments additional to TWC could either be
preferable to TWC (see evaluation criteria in chapter 3) or could complement and support TWC in fulfilling
given policy objective(s).
• When it comes to economic instruments, under the EWC project it is concluded that the
interaction between TWC scheme and energy taxes is –in principle– complementary.5 Even
though subsidies and tax deductions would simply double up the cost reducing effect of TWC, it is
unlikely and economically questionable that such support schemes would be continued for
projects eligible for TWC schemes. So, subsidy schemes and tax deductions have to be adapted
to avoid overlap.
• Standards are a key feature in many command-and-control policy instruments. Performance
standards for equipment are not seen to interact much with TWC. Comprehensive performance
standards, such as the Energy Performance Standard (EPN) for new buildings in the Netherlands,
do not, however, combine well with TWC.6 The idea of additionality evaporates in this case,
meaning that it simply becomes hard to apply white certificates in transparent manner. Voluntary
agreements constitute a platform with a collection of measures, forms of co-operation etc. As an
organizational model it can also function in the context of TWC. The interaction depends on how
additionality is defined with regard to energy savings realized under the agreements. If all
investments made to reach the target were considered additional, they would be eligible for
support from obligated parties. The situation would not change essentially, if only a part of the
target of energy savings would be eligible for TWC. It would be required by the specification of a
baseline within the agreement. Where voluntary agreements involve subsidies and tax
deductions, adaptations have to be made.
• Informative policy instruments deserve particular attention. These are broadly defined as those
policy measures aiming at enhancing the understanding and awareness of how to increase
energy efficiency and its related benefits. For instance, information campaigns, eco-labelling
schemes, customer advice, certification programmes, energy audits etc. Actually, effective
informative policy instruments are considered to be crucial for a TWC scheme to deliver cost-
effective energy savings.7
If the chosen policy objective will be secured energy supply the following options will be available:
increasing the use of indigenous energy sources (e.g., wind energy, biomass), reducing the imports of
non-indigenous energy sources (e.g., fossil fuels), diversify energy imports (e.g., from more reliable
countries) and types of fuels, increasing end-use energy efficiency and reducing energy use. As it can be
seen, instruments focusing on energy efficiency (including TWC) is just one type instruments that can be
used to address the overall policy objective. Therefore additional policy options may be relevant for
achieving this objective, i.e. policy instruments such as a Tradable Green Certificate (TGC) scheme,
aiming at increasing the development of indigenous sources of renewable energy, etc. The results of
EWC show that TWC and TGC very much supplement each other.

If the chosen objective is CO2 emission reductions, additional measures could be identified, including also
increasing use of cleaner fuels and technologies. In the variety of policy instruments applicable for
reaching this objective, emission-trading schemes will be introduced as a strong candidate for reaching
the objective. In the EWC project the interaction and integration of TWC with the EU-ETS has been
analysed. The general conclusion of this analysis is that caution is needed not to build in any double
counting in the systems when electricity savings are considered. Moreover, the most interesting linking
option acknowledged is one-way fungibility, where energy suppliers that receive and trade TWC are
allowed to transfer them into the EU-ETS scheme –and eventually convert them to allowances– only if the

5
See Perrels, A. Oraren, A., Rajala, R. (2006). White Certificates and interactions with other policy instruments. Task report work
package 3.3. EuroWhiteCert Project.
6
However, such an instrument can be crucial to support the definition of business-as-usual trends.
7
See Mundaca, L., Neij, L. (2007). Policy recommendations for the assessment, implementation and operation of TWC schemes.
Task report work package 5. EuroWhiteCert Project.; and Perrels, A., Tuovinen, T. (2007). Assessing the overall market potential of
Tradable White Certificates in EU member countries. Task report work package 4.4. EuroWhiteCert Project.

5
original TWC scheme entails a threshold of over compliance of its energy efficiency/saving target. In any
case, if atmospheric pollutants are to be tackled by TWC schemes, policy makers should make this
objective explicit. For instance in Great Britain, the environmental objective of the British scheme has been
also explicitly accompanied by a determined goal. Emissions savings from the second phase (in addition
to those from the first phase) are expected to be 2.2 MtCO2 (0.6~0.7 MtC) per year by 2010. In France,
the energy intensity policy objective of the TWC scheme involves the achievement of an explicit goal
stated in the legal document that introduces such a scheme. It is mentioned that a reduction of energy
intensity by 2% per year up to 2015 and by 2,5% per year from 2015 to 2030 should be accomplished.8
If social policy objectives are explicitly addressed, policy objectives also need to be measurable. For
instance in Great Britain the social objective (or requirement) of the scheme is clearly tackled with a
specific goal: at least 50% of the energy saving target has to be achieved in relation to the so-called
“priority group” of households. This group was defined “as those in receipt of certain income-related
9
benefits and tax credits” .

3. Definition of evaluation criteria

Having identified the policy objective and different alternative policy instruments to accomplish the
objective(s), the definition of evaluation criteria is necessary. The analysis and justification of a TWC
scheme will require an evaluation of each of the alternative policy instruments and should also include
different designs of a TWC scheme. The key question will then be what policy instrument, or mix of policy
instruments, will be most advantageous to achieve the objective.
When evaluating the alternative policy instruments different evaluation criteria could be used. Additional to
meeting the objective of energy efficiency, secured energy supply , reduced CO2 emissions, or any social
policy objectives the evaluation criteria could include:

• Energy/environmental effectiveness: How effective are different design options in meeting the
policy objective, e.g. energy savings through energy efficiency or CO2 emission reductions? How
does the portfolio of instruments influence the effectiveness of TWC schemes?
• Economic efficiency: Does a TWC scheme design allow reaching the target at least costs to the
obliged parties as well as to the society? How much cost-effective compliance can be expected?
What are the trade-offs when greater flexibility is given?
• Administrative burden and transaction costs: What design features and actions are needed to
efficiently administrate a TWC scheme? Do public authorities have the capacity and resources to
effectively administer and enforce a TWC scheme? What are the trade-offs? Which design
elements can reduce transaction costs borne by obliged and eligible parties?
• Technological innovation: Can a TWC scheme stimulate technological progress? Which actors in
the innovation chain could be actively involved? How can “additionality” be defined?
• Political feasibility: What design elements can generate tension at the political level? Will these
elements influence the political feasibility of the scheme? What level of compromise should be
made and what are the implications?
• Distributional effects: How are compliance costs distributed or shared across the society? What
kind of expected local/national ancillary benefits can be expected? How are they distributed?

8
Monjon, S. (2006). The French energy savings certificate system. Presentation at the IEA-DSM Task on White Certificates.
Trondheim, Norway
9 OFGEM (2005). A Review of the Energy Efficiency Commitment 2002 – 2005. A report for the Secretary of State for Environmental,
Food and Rural Affairs. Available at http://www.OFGEM.gov.uk/temp/OFGEM/cache/cmsattach/12015_18105.pdf [Accessed August
2005]

6
 4. Design of a TWC scheme, including “flexibilities”
The design of a TWC scheme can look very different. In this handbook we will highlight important aspects
that need to be thought through when designing a TWC.

Define target and time frame of the scheme

Policies without clearly defined objectives, target(s) and time horizon are likely to fail in making real
progress to address the identified problem(s).10 Since a proper introduction of a TWC scheme requires
careful setting of targets, it is essential to improve and complete the required data sets in all Members
States interested in TWC schemes. Logically, for a target to be defined, baseline setting is crucial (see
section 5). Historical data, quantification of cost-effective potentials and an understanding of consumer
behaviour are highly needed.
When creating a market for TWC, the level of ambition is critical. In other words, a fundamental pre-
condition for a TWC scheme to be effective is the establishment of mandatory energy saving/efficiency
targets. Ambitious target goals and thus scarcity of TWC (i.e., used up cost-effective potentials) will also
influence the trading activity. If for instance we look at the number of obliged parties in GB, six major
suppliers mostly define the market. In fact, despite the fact the coverage of the British scheme is smaller
than in France and Italy, the level of ambition –as reflected in the energy saving target- seems much
higher. This level of ambition also reflects the high energy saving potential that the dwelling stock in GB
offers. Certainly, a single eligible end-use sector and limited number of obliged parties makes possible for
the authority to face a low administrative burden.
For the specific time frame type of flexibility, “banking” must be allowed so obliged parties that over
comply can save their surplus of TWC for future commitment periods (e.g., as in Great Britain). A
“borrowing” option for non-compliance can also be established. This means that an obliged party that does
not comply with its target commits itself to a greater target in the next compliance period.
A penalty system for non-compliance also needs to be defined. For instance the French scheme sets a
penalty of 20 Euro/MWh thus one may expect that in France certificates will trade at a market price close
to this level. If the penalty of the scheme were set below the marginal costs of energy saved, parties would
prefer to pay penalty instead of achieving their individual quotas. In other words, the penalty has to be
above marginal costs of energy saved in order to create or send the necessary financial signal to the
responsible parties to meet their individual target.

Define obligated parties

Although obliged parties (i.e., subject to the obligation) are energy suppliers in the case of GB and France,
distributors –upstream in the energy system- are responsible for meeting a given target in the Italian
scheme. One clear advantage of choosing energy suppliers as obliged parties is that they have close
interaction with end-users. On the contrary, choosing distributors as obligated parties may have the
disadvantage that obliged actors may have scarce knowledge about energy end-users. Nevertheless –as
in Italy- such option has the advantage that energy distributors are regulated which makes cost recovery
mechanisms more transparent. In Italy, there is another advantage linked to this option (at least in the
electricity sector): the Italian Regulatory Authority has set a maximum level for total revenues deriving
from electricity distribution. Such revenues evolve in time proportionally 75% with the number of
customers and 25% with the amount of sales. Obliged actors are hence not that much penalised from
energy sale reductions due to saving obligations.

If all energy suppliers are chosen as obligated parties, the number of actors may be rather large. To limit
the number of suppliers to those with a certain percentage of the market may limit the number of actors
but may also cause market disturbances and changes in the preferences of energy carriers. By limiting the
number of obliged parties some trade-offs arise. For instance, the limitation of actors may decrease the
administrative burden for authorities but it may also decrease market liquidity TWC schemes addressing
only, for example, electricity suppliers would limit the number of parties; however, such a scheme would
increase cost of electricity and possibly reduce the use of electricity for heating in favour of other fuels with
potentially higher environmental burdens.

10
IIIEE, IEI & UNDP (2002). Energy for sustainable development. A policy agenda. UNDP, New York, 2002.

7
Alternative obligated parties could be energy end-users, building owners or technology producing
companies; however such parties have not been discussed within EWC. In all, we identify a risk for
significant M&V, enforcement and transaction costs as a result of dealing with large and disaggregate
number of agents. The number of obliged actors could be limited by e.g. including suppliers or distributors
larger than a certain limit. Nevertheless, this may course market disturbances and changes in the
preferences of certain energy carriers or trade-offs as a limited number of buyers and sellers can hamper
the liquidity of the market. On the other hand, M&V and transaction costs may be reduced if the TWC
scheme could be combined in a good way with other policy instruments such as buildings standards or the
energy declaration of buildings.

Define other eligible market agents

Another type of flexibility refers to the participation of eligible parties. The potential number of buyers and
sellers (i.e., obligated and eligible parties) is crucial in order to ensure high liquidity. From the experience
in GB and Italy, we can identify that the size of market, among other factors (e.g., legal barriers,
transaction costs, etc.), does not entail necessary conditions for being sufficiently liquid. In fact the limited
number of market, inter alia, has affected the trading activity in GB. Other eligible markets agents can thus
enhance TWC market liquidity.
While eligible these parties do not bear any obligation, but increase the liquidity of the market by supplying
the TWC market (e.g., as ESCOs in Italy) with further cost-effective savings and thus certificates. By
enlarging the number of market players, due consideration has to be given to transaction costs as well as
enforcement efforts done by the authorities.

Within this group of eligible market actors we find accredited ESCOs, which provide energy services and
implements energy efficiency projects in end-use sectors. By improving performances that ensure energy
savings, an ESCO makes its remuneration directly attached to the achieved savings.11 ESCOs can also
implement energy efficiency projects directly on behalf of responsible parties. Other actors (e.g., brokers,
manufacturers of equipments, municipalities, etc.) whose participation has to be approved by the
authorities can also participate in the TWC market. For instance in France, economic actors able to
achieve or bundle more than 1GWh in savings could be gaining certificates to sell to the obligated parties.

Define eligible sectors

For this type of flexibility, the larger the group of eligible end-use sectors, the more options for finding the
most cost-effective solutions exist. Nevertheless, while only a single eligible sector exist in the British
scheme (i.e., household), high cost-effective potential in the insulation segment have allowed the scheme
to yield net financial and economic benefits for the society.12
TWC could be a scheme that covers all sectors or a scheme covering only one or a few sectors. TWC in
Great Britain (GB) only cover the household sector whereas the TWC in Italy and France basically cover
all end-use sectors. What sectors to include depends on the national context (i.e. taking into account
measures to be captured, market conditions and other policy instruments already in place). For most
countries, the household sector, the service sector and the industrial sector not covered under the EU-
ETS could be relevant sectors to be included in a TWC scheme. The transport sector, which has been
included in the French system, may also be an option that needs to be carefully analysed.

Define energy carriers to be covered

Considering energy suppliers (i.e., retailers) as responsible parties, one should take into account suppliers
of fuels within the system; which in total could be a considerable number of actors. While gas and
electricity are the dominant energy carriers under the British and Italian schemes, multiple energy carriers

11
It has to be considered that the main goal for an ESCO is to increase energy efficiency and not reduce CO2 emissions, despite the
fact that one leads to support the other one.
12
See Lees, E., Evaluation of the Energy Efficiency Commitment 2002–2005, Report to DEFRA, Eoin Lees Energy, UK. Available at
http://www.DEFRA.gov.uk/environment/energy/eec/pdf/eec-evaluation.pdf [Accessed May 2006] and Mundaca, L., Transaction costs
of tradable white certificate schemes: The Energy Efficiency Commitment as case study. Working paper. International Institute for
Industrial Environmental Economics, Lund University, Sweden, 2006.

8
are subject under the French system, which covers electricity, gas, LPG, domestic fuels (not for transport,
though) and heating and cooling for stationary applications. The selection of energy carriers is not a given
but may differ from one country to another.
We stress the importance of a careful selection of energy carriers to be included. For example, in a
scheme aimed at energy savings, the system may encourage a shift from one energy carrier to another if
not all energy carriers are covered, and thus reduce the market of energy savings in the system, with
negative rebound effects (e.g., higher atmospheric pollution due to shift from electricity to consumption of
oil products for heating energy systems). In addition, if interaction/integration between the TWC scheme
and the EU-ETS is allowed, careful consideration need to be paid to electricity savings to avoid the
problem of double counting.

Define eligible measures and additionality

The range of eligible measures that obliged parties can use to achieve their target is another type of
flexibility. Having identified the objective, energy efficiency measures to fulfil that objective need to be
recognized. The eligible measures and their cost are likely to be different form one country to another.
In principle, and depending on the level of additionality (see below), any measure that will be related to the
objective could be included in TWC. When introducing the TWC scheme in Italy, the system included
around 14 categories with 35 sub-categories of potential eligible energy efficiency projects, for example:
• Compact Fluorescent Lamps (CFLs)
•
2
m of cavity wall / roof insulation
• Small PV applications
• Solar heaters
• High efficiency boilers
• Replacement of electric water with gas water heaters
• Double glazing
• High-energy efficiency “white” appliances (fridges, freezers, dishwashers, etc.)
• Low-flow water taps
• High efficiency electric motors
• Heat pumps
• “Smart” light-flow regulators
• Energy recovery from natural de-compression
• CHP
• District heating

In GB, the initial set of measures is smaller than the Italian one. Authorities have suggested to the energy
suppliers a “mix of possible measures”. Suppliers of electricity and gas are always invited to include other
measures, which are subject to the approval by the authority (this is also the case for Italian obliged
parties). The mix of measures has been developed taking into account information provided by energy
suppliers, industries concerned about the scheme and also by experts (e.g., Building Research
Establishment). The set of energy efficiency measures encouraged or suggested in GB includes
• Cavity wall insulation
• Loft insulation, top up – increasing the depth of existing loft insulation, if 75mm or less, to 200mm
• Fridge saver-type programme – trade-in schemes such as ‘Fridge savers’
• Condensing boilers – to motivate consumers, when they come to replace their existing, worn out
conventional boiler, to choose a condensing boiler;
• Appliance replacement – to motivate consumers, when they are replacing existing appliances
such as fridges and freezers, to take up high efficiency models;
• CFL – extra bulbs – this measure is assumed to be targeted at consumers who already have
CFLs in high use areas (e.g., hall, staircase, living room), enabling them to fit energy efficient
bulbs in medium use areas
• CFL – first bulbs – this measure is assumed to be targeted at priority consumers who currently
have no CFLs fitted, with the lights going into high use areas
• Tank insulation, new – for hot water tanks currently without any form of insulation
• Tank insulation, top-up – adding a further layer of insulation to reduce heat loss.

9
A larger scheme including many measures makes possible the inclusion of all types of cost-efficient
measures. This in turn may give rise to a scheme actually capturing all types of cost efficient measures. At
the same time the administrative costs in terms of M&V may introduce uncertainties and be large
depending on the M&V approach used (i.e., ex-ante or ex-post), decreasing the efficiency of the TWC
market if technical procedures are not carefully designed. The broader the set of eligible technologies, the
higher the flexibility for the obliged parties is. However, due consideration has to be given to M&V aspects,
for instance.
An important point regarding the eligibility of energy efficiency measures concerns additionality. In other
words and despite of the debate in this regard, TWC schemes encourage energy efficiency measures that
would have not taken place under business-as-usual (BAU, i.e., depicted by the baseline). The question
that arises then is how the additional component of energy efficiency is determined.
In GB, responsible parties must demonstrate that energy efficiency improvements are implemented
beyond BAU (e.g., due to building codes). Additionality can then be justified in terms of financial reasons
(e.g., energy efficiency would not have taken place because of a lack of capital of household owners). For
instance, it can be said that the priority group is getting 100% additionality due to the high cost of CFLs
and the low income of the consumer (i.e. it is unlikely that low-income households purchase CFLs in the
absence of the EEC scheme). Landlords can give another evidence of additionality. In effect, for energy
efficiency measures taking place in the priority group, energy suppliers need to receive a letter from the
landlord stating, “No, we would not have carried out these measures outside the EEC [Energy efficiency
commitment]”. Authorities in GB recognize that it becomes difficult to draw the line between additional and
non-additional measures when local energy efficiency programmes are in place.
In Italy, additional energy savings are those that are “over and above spontaneous market trends and/or
legislative requirements”.13 In France, apart from what the building codes require, the energy savings
actions must be additional with respect to the ordinary activity of the implementer, i.e. they are performed
only as a consequence of the present obligation and beyond a plain “business as usual” logic. Criteria for
additionality depend on the obliged/non-obliged features of the actor performing the energy savings
project:

• Obliged implementer: any eligible action aimed at energy savings is considered additional;
• Eligible (but non-obliged) implementer: an action is additional if it is not related to its main activity
and does not give direct incomings to the implementer.
• The local authorities are eligible automatically

Furthermore, additionality aims at preventing responsible parties from free-riding, as it attempts to exclude
those energy efficiency measures that would have been implemented in the absence of the TWC scheme.
Already implemented measures are not considered to be additional, they are not eligible and therefore
obligated parties cannot claim certificates for the gained energy savings.

Define methods for measurement and verification of energy savings

Certainly, the concept of M&V is at the core of TWC schemes. It is of prime importance –inter alia-
because M&V of energy savings is a challenging technical issue, and also due to the fact that different
M&V approaches can be an important source of transaction costs.
Measurement and verification (M&V) rules have probably been the more complex issue that current
schemes have faced. Event though, as mentioned before, any measure aimed at increasing energy end-
use efficiency could be eligible under these schemes, this is somehow limited by the fact that the
measurement of energy efficiency is technically complex. Italy can be taken as a remarkable example of
how complex this process is; which among issues generated some delay in the implementation of the
TWC scheme. In Italy, measurement and verification (M&V) procedures involve 3 different approaches:

• Deemed or known (ex-ante) savings: it entails simplified energy saving calculations. Savings are
known in advance, limited provision of documentation, and reduced monitoring and certification
procedures. It applies to measures for which energy savings are well known. This approach

13
See Pavan, M. (2004) The Italian White Certificates System: Measurement and Verification Protocols. Unpublished.

10
 2
applies to measures that yield up to 25 toe per year in savings. Examples: CFL, m insulated wall,
small PV applications and high efficiency boilers.
• Engineering estimates (hybrid ex-ante ex-post approach): it applies to measures for which energy
savings are known but they may differ depending on a number of restricted factors (e.g.,
availability factor or number of working hours). The set up of a hybrid approach can be more
accurate than a pure ex-ante methodology, without a substantial increase of the M&V costs. To
avoid a large increase in the M&V costs, only the largest or unpredictable measures should be
analysed through an ex-post methodology. This approach applies to measures that yield up to 50
toe per year (for ESCOs and small distributors) and 100 toe per year for large distributors in
savings respectively.
• Metered baseline method (ex-post): it applies to measures for which energy savings need to be
addressed in a case-by-case basis. It entails direct measurement of energy use, pre-approval of
proposed baselines and methodologies. More documentation and procedures are involved for ex-
post verification and certification. This approach applies to measures that yield up to 100 toe per
year (for ESCOs and small distributors) and 200 toe per year for large distributors in savings
respectively.

In GB, the scheme grants energy savings based entirely on an ex-ante approach. The estimation process
has been supported by relevant organizations. The approach is largely explained by the fact that the
performance of the set of eligible technologies is well understood. The size, type and performance of the
measures are well known and related estimates use best available data. M&V procedures, together with
the eligibility of energy efficiency measures are thus a much less complex case; which has decreased the
administrative burden of OFGEM. Related energy efficiency calculations (e.g., gained energy savings) are
made using the “best available information” as a criterion. OFGEM, in charge of M&V, assesses and
approves all the supplier’s measures. OFGEM reports to the Secretary of State each year and does
random monitoring to check the installations and if customer satisfaction is still carried out.
In France, at the time of writing of this report, 93 detailed methodologies associated with the measures for
the household and commercial sectors have been published and 46 are under development. The
approach followed is similar to the “deemed” approach taken by the Italian scheme or the “ex-ante”
approach used in Great Britain. An interesting development by the French is the differentiation of energy
saving according to geographical region due to large variation of climatic zones (similar development is
now also seen within the Italian scheme)14 For the transport sector, the French scheme has introduced
“deemed savings” also for four measures (e.g., bus driver training, energy efficient tyres, vehicles running
on cleaner fuels and recuperation on braking).
In all, simple but clear defined guidelines for M&V of energy savings are a rather critical issue in TWC
schemes. For ex-ante approaches, the underlying element to consider here is the wealth of the
information required (technical and financial). In Italy and GB the key criterion to grant ex-ante energy
saving is that baselines and the expected performance of certain measures is rather well understood.
Therefore any M&V activity carried out lowers the cost-effectiveness of the schemes.
Define cost-recovery system
In case the responsible parties of the energy efficiency measures are energy suppliers or distributors, the
cost of these measures and additional cost need to be covered.
In both GB and Italy, cost-recovery can be done throughout electricity and gas tariffs. In Italy, this is on the
basis of certain criteria developed by the authorities (e.g., net profit variations resulting from project
implementation)15 In Italy, the cost recovery amount has been predetermined by the authority at

14
See Adnot, J., Duplessis, B. (2006). Supply side: Measurement and verification of energy efficiency projects. Task report work
package 4.1. EuroWhiteCert Project; and Monjon, S. (2006). The French energy savings certificate system. Presentation at the IEA-
DSM Task on White Certificates. Trondheim, Norway.
15
Malaman R, Pavan, M. (2002). Energy efficiency certificate trading: food for thought from a recently launched Italian scheme.
Presentation at workshop IEA-DSM, IEA and CESI, Milan Italy 2002.

11
 16
100/TWC. In has to be mentioned that in GB there is no constraint on how much suppliers can charge to
their customers; which may not necessarily be the case in other EU countries.
A more fair investment cost-recovery system could be framed in real business terms, meaning that users
that benefit from higher energy efficiency are the only ones financially responsible for the investment costs
of the energy efficiency measures and not shared with other costumers.

Define trading aspects

In principle, obligated parties and other market agents can participate in the trading of TWC. Certificates
can be traded bilaterally or openly in a trading platform. TWC are then used as proof that energy savings
take place through the implementation and M&V of eligible energy efficiency projects.
The first group of buyers and sellers that we identify are the obligated parties as such. On the one hand,
obligated parties whose energy efficiency projects yielded energy savings above their individual targets
may sell their surplus of certificates on the TWC market –and thus be able to make profit out of it- or save
them (i.e., banking) for future commitments periods or speculate for higher market prices. On the other
hand, obligated parties whose energy efficiency projects yielded energy savings below their individual
targets may purchase certificates on the TWC market in order to comply with their commitments or pay
the penalty for non-compliance.
The second group of buyers and sellers that we identify are “eligible markets agents”. In this case,
accredited ESCOs and/or other approved organizations carrying out independent and eligible energy
efficiency projects, can sell TWC on the market driven by business opportunities, and thus are being able
to make profits from gained energy savings. Furthermore, these actors could also buy TWC and thus act
as brokers within TWC markets, speculating for better market prices for selling them.
In addition to the participants to be allowed to participate in the market, the following issues need to be
considered:

• Metric and lifetime of the certificates: Internationally speaking, a lively debate has taken place in
order to determine the “lifetime” of certificates in relation to the lifetime of energy savings.
Different approaches have been discussed and used. For instance in Italy, the approach is to
grant savings in relation to the metric unit used for the certificate as such (e.g., 1 tonne of oil
equivalent)17. Then, the lifetime of the certificate is given for a certain period of time (e.g., 5 years
in the Italian scheme). In the case of GB and France, savings are cumulated and discounted over
the lifetime of the measures.18
• Accounting and trading rules: Elements to be considered here are trading between agents on the
spot market or through bilateral contracts, frequency of transactions, database system that keeps
track of transactions, penalty, trading rules, enforcement, banking, borrowing, etc.
• Interaction/integration with other schemes: It is important to mention that a potential TWC market
should also consider interaction/integration alternatives with other tradable schemes and thus the
fungibility among different certificates (e.g., conversion rates, lifetime, etc.). With due
consideration to technical complexities, administrative burden and transaction costs, economic
efficiency could be lower by creating separate markets for trading a commodity that entails the
same benefits and similar or compatible policy objectives. Double counting is something that any
integration of schemes must take into account when overlapping of eligible sectors/parties/fuels
exists. For instance, up stream emission reductions are realized when electricity savings
materialize in a given end-use sector. If environmental/energy integrity is not provided for, one
action here leads to create certificates in two different markets (i.e., CO2 emissions allowances
are generated while the measure also yields TWC). Double crediting leads to meeting targets

16
Measured in tonne of oil equivalent (toe)
17
For instance if an energy efficiency project yields 50 toe per year and has a 5 year lifetime, 50 TWC are issued each year for 5
years. This means that this project yields up to 250 TWC in total.
18
In GB, discounted and cumulated savings are also fuel standardized in order to reflect the different level of primary energy input to
a kWh of electricity and its carbon content. For further information see DEFRA (2004). The energy efficiency commitment from April
2005. Consultation proposal. Available at www.defra.gov.uk

12
 artificially, thereby undermining the environmental/energy effectiveness of the instruments and
the efficiency of both markets.

The establishment of an electronic trading platform should take place by setting the place where potential
buyers and sellers can meet regularly at any time, allowing bids and bilateral trading as well. Both a
clearinghouse (i.e., common information channel of all market and institutional aspects) and a trading
platform will enhance transparency of the scheme. The development of standardized contracts (or at least
standardizing key contractual provisions) is needed to reduce legal services and perceived liability risks
when trading. Authorities and obliged parties should work together in designing contracts that ensure that
no strategic information is disclosed to buyers or sellers of TWC that are eventually competitors in the
energy market. Roles and penalties for non-compliance must be clearly determined.

Flexibilities
All in all, the central argument for implementing TWC schemes (or any tradable certificate scheme) relies
on the least-cost compliance by means of high flexibility. Therefore, the design of the scheme must allow
obliged parties to implement the most cost-effective eligible measures. As one observe from the design
elements, trading is no the only given “flexibility”. In fact, five types of flexibility are identified:

1) The range of eligible measures that obliged parties can use to achieve their target
2) The eligible sectors to be used for achieving the mandatory target
3) The given time-horizon alternatives to meet the target
4) The possibility to allow eligible parties to participate in the scheme
5) Trading as such.

As previously mentioned, policy makers have to be aware of the multiple trade-offs embedded when
dealing with these issues. The set of “flexibilities” in a TWC scheme strongly indicates that a proper
balance between high efficiency/effectiveness and low administrative burden and transaction costs has to
be found. An effective institutional framework developed to sustain the scheme is thus fundamental.

5. Baseline definition/setting
To analyse the potential effect of a TWC scheme or any alternative policy instrument a baseline must be
developed. This baseline estimation addresses the research question: “What would market actors who
were exposed to the programme have done in the absence of the programme?” (i.e., level of activity
carried out anyway or under business-as-usual, so-called “deadweight”). Several general strategies have
been developed to address this question. The following methods are among those most frequently used:19

• Self-reporting of programme influence

• Reference to codes and standards
• Time series and trend analysis

There is a need for standardization for baseline calculation, method and data collection protocol for all
relevant energy end-uses and for different sectors. To gain authority for the analysis, the baseline
methods to be used will require a strong support from authorities and other involved actors and
organisations. Due to the fact that energy efficiency is a moving target, reference scenarios or baselines
must be kept updated. Assumptions and methods included in this approach need to be carefully
scrutinized and reviewed periodically.

19
See for example Vreuls H., de Grootte W., Back P., Schalburg R., Dyhr-Mikkelsen K., Bosseboeuf D., Celi O., Kim J-D. and Neij
L., Evaluating Energy Efficiency Policy Measures & DSM programmes – Evaluation Guidebook, International Energy Agency (IEA) –
Implementing agreement on Demand-Side Management, SenterNovem, The Netherlands, 2005.

13
If an ex-ante measurement and verification (M&V) approach is to be developed, the need for baselines on
a measure-by-measure basis is crucial. Also called “deemed saving” or “default” approach, an ex-ante
M&V approach requires no field measurement and works effectively for energy saving measures for which
technical performance is well understood (e.g., household measures targeting lighting, appliances, heating
and insulation). The suitability of this approach is heavily related to the knowledge about baselines and
performance of measures. For “proven” technologies, energy savings granted beforehand should be
applied. In simple terms, savings are calculated based on standardized estimates on the difference
between the reference scenario (or predetermined baseline) and the performance of the implemented
measure and then are possibly discounted over the estimated lifetime of the measure. Stakeholders must
be prepared to discuss and negotiate the details of this approach (e.g., assumptions, parameters, baseline
selection, resulting energy savings, “deadweight” of measures, etc.). Again, as energy efficiency is a
moving target, the assumptions, baselines and methods included in this approach need to be carefully
scrutinized and reviewed/updated periodically.

6. Evaluation methods
The evaluation method to be used to evaluate a TWC scheme and other alternative policy instruments
needs to be defined. By stressing that there is no single-best method for evaluating TWC schemes,
preferably both quantitative and qualitative methods need to be used. We hereby briefly summarize the
different and complementary evaluation approaches used, to some extent, under the EWC project.

Modelling tools
One type of method often used for evaluating policy instruments relies on different kinds of models. In
these models the design and the mechanisms of the different types of policy instruments needs to be
generalised in different ways and the actual acceptance or change in behaviour of relevant actors will be
characterised as a parameter such as a discount rate or elasticity. The baseline used in these methods
will most often be time series analysis, i.e. an extrapolation of a given trend. The effect of the policy
instrument will then be seen as a deviation from this given trend line.
Models could be either top-down or bottom-up oriented. Top-down models are more aggregated and
development will rely on parameters such as economic growth, energy consumption and energy prices.
The major advantage of these models will be the existence of relevant statistical data and the relative
elementary calculations. The method will also be easy to harmonize with other countries. The major
disadvantage is the difficulties in actually analyzing and identifying any actual change due to policy
instruments; this is due to the aggregated parameters in these models. Bottom-up models are more
disaggregated and rely on technical data describing each sector; moreover, different actor categories
could be characterized using different parameters, i.e. different discount rates. The major advantage in
using bottom-up models will be the use of disaggregated data that will make it easier to see the effects of
any policy instrument. The major disadvantage will be the requirement of good data. Hybrid models,
combining both top-down and bottom-up models also exist.
A useful departure point for the modelling of a TWC scheme is its characterization (i.e., saving target, time
horizon, eligible measures, etc.) and thus coverage (i.e., eligible sectors, eligible fuels, eligible/obliged
parties). As mentioned before, different design schemes can be used to build different scenarios. A
simulation exercise can then take into account some elements of the design of a TWC scheme and thus
give a better understanding of the potential outcomes. Some studies have demonstrated their benefits
when applied to a specific geographical context.20

20
See for example DEFRA, The Energy Efficiency Commitment from April 2005. Consultation proposal. Department for
Environment, Food and Rural Affairs, May 2004. London, UK, 2004; Farinelli, U., Johansson, T., McCormick, K., Mundaca, L.,
Oikonomou, V., Örtenvik, M., Patel, M., and Santi, F. ‘‘White and green: Comparison of market-based instruments to promote energy
efficiency.” Journal of Cleaner Production 13 (10–11): 1015–1026, 2005; Mundaca, L., Santi, F., Quantitative assessment of selected
policies and measures using the Western European MARKAL Model. IIIEE Report 2004:10. Available at
http://www.iiiee.lu.se/Publication.nsf/$webAll/CC3321975132486FC1256F96005AB5E3/$FILE/Report_Western_Europe.pdf

14
Under the EWC, a modelling exercise was undertaken. It entailed the modelling of a possible TWC supply
at the EU level as derived from existing estimates of national saving potentials as well as unit cost of
energy savings in the sectors covered by TWC schemes.21 A simple cost minimisation model was
devised, whereas data about the level and spread in unit cost of energy saving options and of energy
retail prices were obtained for four countries (i.e., Finland, the Netherlands, Hungary and the UK) and the
EU-25. The results were compared with simulation results from earlier studies as well as with the
simulation gaming sessions (see below) and country assessments under WP5 of this project.
While modelling work supports TWC schemes as cost-efficient policy instruments, the actual design and
implementation process of a TWC scheme is a complicated task, and theoretical benefits of TWC must
not underestimate the challenges to get these schemes to work effectively. Whilst modelling studies do
provide useful insights, stakeholders should bear in mind that the outcome must be taken with due caution
because assumptions, limitations and many challenging and complex issues need to be overcome to get
TWC schemes to work effectively and efficiently, as theory indicates. Due to the simplification of the policy
instrument as such and the actual change pattern achieved by this policy instrument, this type of
evaluation is likely to yield only indications of any probable results. In all, this type of evaluation method
should be complemented with other evaluation approaches.

Gaming simulation exercises

A gaming simulation exercise can be a powerful analytical tool that allows the evaluation of system
behaviour in response to actions and events via the use of archived data and pre-determined rules. Under
the EWC project, a simulation study was undertaken in order to explore, among others, how the design of
a possible EU-TWC scheme may affect the market potential of TWC. A certain number of players
(representing Austria, Bulgaria, Finland, Germany, Italy, Portugal and United Kingdom) were recruited
among project partners as well as the identified TWC demand group representatives. Both supply and
demand of TWC met via internet in different simulation rounds aiming at testing possible market actor
response to the implications of the various designed TWC schemes.22
Based on analyses accomplished within the framework of the EWC project and the lessons learnt through
the interviews performed, key design features of a TWC scheme were identified and simulated based on
mandatory national energy saving obligations. An OTC (Over the Counter) international market consisting
of TWC bilateral trades was designed for the first simulation round. For the second and third round,
simulated national TWC schemes integrated in an EU trading platform were analysed. Learning outcomes
from each simulation round can be used to further design the next simulation round.

Surveys and interviews

A variety of qualitative methods can be used to complement quantitative results. A survey is basically a
method to gather information from a number of individuals. A sample (statistically determined) is usually
drawn to learn key aspects from a large population. A questionnaire is then the “mean” or “vehicle” to
bring in the needed data for analysis. The questionnaire needs to be carefully designed and validated. An
interview is basically an inquiring research method with the aim to identify and explore the
views/perceptions/knowledge of interviewees about a given subject. An interview is usually built upon a
specific topic, interview protocol, respondents and performing the interview as such.
Under the EWC project, key actors in a number of EU countries were interviewed in Hungary, Bulgaria
and the UK in order to explore the possibility and desirability of having TWC schemes. Here, the
perception that stakeholders –mostly policy makers- might have under a hypothetical TWC scheme was
tackled. Interview protocols were designed and questions addressed a number of institutional and market
issues. For instance, how would TWC fit into the policy objectives for energy efficiency/carbon/energy?

[Accessed Dec 2004]. and , Mundaca, L. A European market for energy efficiency? Implications of an EU-wide “Tradable White
Certificate” scheme. Working paper. International Institute for Industrial Environmental Economics, Lund University, Sweden, 2006.
21
See Perrels, A., Tuovinen, T. (2007). Assessing the overall market potential of Tradable White Certificates in EU member
countries. Task report work package 4.4. EuroWhiteCert Project.
22
For further details see Adnot, J, Duplessis, B., Labanca, N., Rezessy, S. (2007). Demand side: Identifying alternative market
participant types and structuring the demand side. Task report work package 4.3. EuroWhiteCert Project.

15
Would the policy aim be to reduce carbon emissions; improve energy savings; and/or stimulate the energy
efficiency sector? What additional institutional infrastructure would be required to establish a domestic
TWC scheme? Would it be desirable to trade energy savings nationally/internationally?
In addition to the study of stakeholders’ perception of TWC mentioned above, interviews were also made
with respondents from nine countries (the UK, France, Italy, Germany, Austria, Finland, Portugal, Hungary
and Bulgaria) focusing on stakeholders that might represent the demand side in TWC schemes. Different
types of interviewees were identified through a preliminary analysis devoted to get a proper understanding
of parties with possible interest in TWC and to structure the demand of TWC. The interviewee categories
addressed included energy distributors and suppliers, large energy consumers, state energy efficiency
authorities, businesses or other entities maintaining a green image, ESCOs and financial institutions
active in energy efficiency.
In order to identify the nature and scale of transaction costs (e.g., search and assessment of information,
negotiation with business partners, measurement and verification of energy savings, acquisition of legal
services), a survey among grid companies was used under the EWC project. This survey was used to
identify and analyse the transaction costs affecting the planning of energy efficiency projects based on
experience of the grid companies in Denmark that have to meet mandatory energy savings. As a result,
key sources of transaction costs were identified (e.g., search for information, contacts and/or contract
negotiation, due accreditation of the energy audit).

Panel methods
Generally speaking, in panel method respondents –usually experts- are asked to give their opinions about
a given topic, problem and/or situation (e.g., Delphi method). This usually requires the development of
questionnaires, definition of facilitator, preparation of information, efficient communication, selection of
experts, analysis of responses, and reporting.
With due limitations, a similar approach was undertaken under the EWC project. A group of experts and
stakeholders were appointed forming a steering committee. This served as a discussion forum on the
overall project progress and result. This group was exposed to the findings of the project and consulted
about further guidelines and feedback. The group gave inputs on different aspects concerning the design,
implementation, operation and performance of TWC schemes and related policy instruments.

Additional aspects
In addition to the evaluation methods described above, it will be important to identify/capture the following
and critical factors influencing the performance of TWC schemes:

• potential cost sources

• potential institutional and administrative burden
• potential co-benefits
• potential distributional effects
• potential political feasibility

Each of these factors may have a major effect on the actual acceptance, effectiveness and efficiency of
TWC schemes.
The cost sources to be included will cover data on the potential costs of eligible measures faced by
obliged/eligible parties and/or end-users. The institutional and administrative burden should cover
programme cost by the government related to design, redesign as well as the need of special
competences and specific data for both the authority and obliged /eligible parties. Moreover, estimations
of transaction costs should be assumed covering, for example, search and assessment of information,
negotiation with business partners, measurement and verification of energy savings and acquisition of
legal services.
The co-benefits and the distributional effects need to be identified; however, to value these may be
problematic. Important outcome may be to emphasise co-benefits and minimise actual unwanted
distributional effects in any given design of a TWC scheme.

16
The outcomes of the analysis must be analyzed against the evaluation criteria. They also have to
feedback the different design scheme options. This feedback process should be understood as an
iterative process. In all, quantitative and qualitative assessments of TWC schemes must be performed
consistently with due justification and analysis of other policy instruments to improve energy efficiency.
Thus, stakeholders can analyse, discuss and compare different design options of TWC, as well as
alternative energy policy instruments for energy efficiency (e.g. taxes, subsidies, information programmes
etc.).

7. Concluding remarks
The design of a TWC scheme could look very different and it is not easy to draw a given TWC that will be
more effective and efficient than other policy instruments. To actually find out the design of a preferable
TWC scheme one needs a carefully outlined assessment as described in this handbook; and to achieve a
preferable TWC scheme several alternative design options should be designed and evaluated
accordingly. These TWC schemes should then be compared to each other and to other possible policy
instruments applying different types of methods. The evaluations, which will require extensive data, time
and resources will provide valuable insights of effectiveness and cost of the different schemes.
Additionally, it must be kept in mind that the results of the analysis will only give indicative results to guide
the programme managers, analysts and planners. Moreover, continuous ex-post assessments are
recommended for implemented TWC schemes. As an outcome, these studies serve as a basis to make
the necessary corrections to the scheme, enhancing the performance of the TWC scheme. Overall, these
studies should aim at identifying key market and institutional conditions influencing the performance of
TWC schemes, providing key policy recommendations to improve their actual performance. Regardless of
the type of assessment that is carried out, stakeholders must remember that uncertainty about the impacts
of TWC schemes is an inherent and critical element influencing the policy decision-making process.

17
 Stepwise towards European energy efficiency policy portfolios involving White Certificates

www.eurowhitecert.org

eERG - Politecnico di Milano

EuroWhiteCert is supported by the European Commission and several national governments.

It is conducted under the auspices of the Intelligent Energy for Europe (IEE) Programme of the European community and fifteen
national agencies: Austria – AEA, the Austrian Energy Agency; Bulgaria – EnEffect, Centre for Energy Efficiency; ESD Bulgaria
Ltd, Energy for Sustainable Development; Finland – VATT, the Government Institute for Economic Research; France – ARMINES,
Contract research organisation of the Ecole des Mines de Paris; ADEME, French Agency for Environment and Energy
Management; Germany – ZSW, Centre for Solar Energy and Hydrogen Research; Greece – CRES, Centre for Renewable Energy
Sources; Hungary – CEU, Department of Environmental Sciences and Policy of the Central European University; Italy – eERG,
end-use Efficiency Research Group of Politecnico di Milano with the support of la220 and LEONARDO ENERGY; APAT, the Italian
Agency for Environmental Protection and Technical Services; The Netherlands - Ecofys, international consultancy company
specialised in sustainable energy and climate change issues; Portugal – ISR-UC, research and technology transfer institute
associated with the University of Coimbra; Sweden – IIIEE, the International Institute for Industrial Environmental Economics with
the support of ELFORSK (Swedish Electrical Utilities R&D Company) and STEM (Swedish Energy Agency); United18Kingdom –
ESD, Energy for Sustainable Development Ltd with the support of DEFRA (Department for Environment, Food and Rural Affairs)