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==Relevance==
Energy efficiency is one of the EU's primary goals , seeing as it can benefit the economy, the environment and consumers, alike. The inefficient production and consumption of energy is propagating, and worsening the effects of, global warming, polluting the air and lowering the quality of life in cities. In light of [[Article 194 of the Treaty of the Functioning of the European Union]], the EU continuously aims to provide:
* ''‘security of energy supply in the Union’,
* ''‘promote energy efficiency and the development of new and renewable forms of energy’''
* ''‘promote the interconnection of energy networks’''<ref>http://www.lisbon-treaty.org/wcm/the-lisbon-treaty/treaty-on-the-functioning-of-the-european-union-and-comments/part-3-union-policies-and-internal-actions/title-xxi-energy/485-article-194.html</ref>.
With environmental protection and energy policy being such a fundamental goal of the Union, the efficiency of the energy sector, in production, transportation and consumption, should be ensured.
===Energy consumption: facts and stats===
[[File:Eurostat energy consumption.png|thumb|right|Table 1: Gross inland consumption of energy, 1990–2014 (million tonnes of oil equivalent) Source: Eurostat http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=nrg_100a&lang=en]]
With energy production moving towards more sustainable sources, consumption in EU households seems to also be decreasing, albeit rather slowly. This reduction in consumption by households is rather significant, since it accounts for as much as 24.8% of the Union's total. Energy consumption in households in the EU, thus fell by 1.3%, as explained by Eurostat<ref>http://ec.europa.eu/eurostat/statistics-explained/index.php/Consumption_of_energy</ref>. However, this decrease is not equally distributed among MS, with a majority actually experiencing an increase in their electricity consumption (although mostly by less than 10%). Energy conservation efforts , including the installation of conservation equipment, may play a part in this overall decrease; although it is speculated that it is mostly linked to demographic changes. It is, however, tantamount to ensure that energy consumption is further reduced in households, where possible, utilising environmentally friendly technologies.
=== Energy production: facts and stats ===
Energy in the EU is produced through a multitude of sources, chiefly combustible fuels and [[Nuclear power plant|nuclear power plants]], making up for 47,6% and 27,4% of energy production in the Union, in 2014, respectively<ref>http://ec.europa.eu/eurostat/statistics-explained/index.php/Electricity_production,_consumption_and_market_overview</ref> . Recently, however, the importance of renewable energy sources has increased, as highlighted by Eurostat reporting a massive increase of solar and wind power production from 0.02% in 2004 to 3.2%<ref>http://ec.europa.eu/eurostat/statistics-explained/index.php/Electricity_production,_consumption_and_market_overview</ref> of the net electricity production of the EU by 2014. Surprisingly, renewable energy sources were the only resource that experienced such a uniform growth, from 2004 to 2014. There is a long way to go until our energy production becomes more environmentally friendly, sustainable, and efficiently utilises our natural resources.
What is perhaps alarming, is that primary production in the EU has experienced a slump in the years from 2010 to 2014, which does not correspond to a similar drop in demand, with energy production being 17.3 % lower in 2014, than it was in 2004 .
== Main issues, opportunities and challenges: ==
==== Uneven supply and demand ====
A drawback of renewable energy sources is the uneven supply and demand of electricity. The demand for electricity fluctuates throughout the day<ref>https://www.eia.gov/todayinenergy/detail.php?id=830</ref>, as well as throughout the year, and with renewable sources being used, so does supply. Solar panels, for example , produce energy only during the day, and in much greater volume during the warmer months. Thus, it is important to balance the grid and match supply to demand, meaning that either renewable power stations must limit their production during times of low demand, or that energy is not consumed and eventually wasted.
Uneven supply and demand can also affect the EU regionally, as the energy needs of each country may vary greatly, due to such things as: time differences and seasonal requirements (air-conditioning/heating)<ref>https://www.eia.gov/todayinenergy/detail.php?id=4190</ref>.
The problem is intensified, as the analog grids, currently used in most EU Member States, do not involve any storage facilities and, for the most part, do not account for energy wastage, as a direct result of uneven demand and supply of energy.
==== Environmental concerns ====
A stark drawback of conventional energy production is environmental degradation. Only less than one-fifth of the overall energy production of the Union is derived from renewable energy sources, meaning that for the rest, the EU is utilising fossil fuels or nuclear energy, leading to destructive consequences on the environment.
In 2014, Eurostat reported that the EU, as a whole , emitted 4 419.2 million tonnes of greenhouse gases into the atmosphere , as a result of energy production from non-renewable sources. Despite this figure being 22.9% lower than the amount released in 1990<ref>http://ec.europa.eu/eurostat/statistics-explained/index.php/Greenhouse_gas_emission_statistics</ref> environmental damage caused by the release of such a large amount of CO2 and other greenhouse gases into the atmosphere, lead to the depletion of the ozone layer, and consequently, global warming. In fact, due to the amount of environmental degradation which can result from the use of nuclear energy, Germany has sworn off using it. Meanwhile, two reactors in Belgium have been shut down, after the discovery of cracks.<ref>http://www.europarl.europa.eu/atyourservice/en/displayFtu.html?ftuId=FTU_5.7.5.html</ref>
==== Monopolies and weak energy market ====
Another major issue faced by the Union, in terms of energy production is the lack of market liberalisation in the electricity production sector in many Member States. For example, in small States such as Cyprus or Malta, the largest power generator held 100% of the market share for electricity in 2014, according to Eurostat<ref>http://ec.europa.eu/eurostat/statistics-explained/index.php/Electricity_production,_consumption_and_market_overview</ref>. This is an area of concern for the issue of energy efficiency, as it means that the production of electricity in the country is subject to limited or no investment in the free market, potentially hindering the sector’s growth.
Energy monopolies in Member States, have a lot to do with the public sector, as well. In many cases, monopoly in the energy sector exists due to the fact that the biggest electricity production company in the country is state-owned. Such is the case in France, for example, where Electricité de France (EDF) currently provides 90% of the country's net electricity<ref>http://www.economist.com/node/3485202</ref>, especially for residential consumption. The most common argument in favour of this is protection of consumers, as state-owned enterprises are less likely to hold consumers to ransom by cutting supply when the monthly fee is not payed, or raise prices unaccountably. There is also the issue of infrastructure development, an often very costly enterprise, which is not easily taken up by private firms, unless a private monopoly is guaranteed. For this reason, the state often builds energy infrastructure and subsequently also manages it.
Nevertheless, market liberalisation is, one of the key goals of the Commission when it comes to the energy market, as it would allow consumers to choose their providers freely, instead of being forced to abide by the standards of a single- or in any case, very few- companies.
=== Better infrastructure ===
==== Energy sharing between MS ====
In order to be able to match demand to supply in power, and ensure that countries can guarantee energy supply to their citizens (even in the case of a spontaneous halt in the use of imported fossil fuels), it is tantamount for MS to co-operate with each other. Moreover, further investments in infrastructure will allow energy to flow freely and efficiently throughout the EU. Thereby, the vision of the Energy Union could be achieved and the problems regarding the existence of ‘energy islands’ throughout the Union would be addressed.
The European Council set a 10% interconnection target to be completed by 2020, which the Commission believes should be extended to 15% by 2030<ref>http://www.europarl.europa.eu/legislative-train/theme-resilient-energy-union-with-a-climate-change-policy/file-15-electricity-interconnection-target</ref> Investment in such cross-border connective infrastructure is a key step in ensuring stable energy supply and prevent wastage.