Planning versus implementation of energy saving projects by industrial companies. Insights from the Dutch Long Term Agreements

Abstract

Companies participating in the Dutch voluntary agreements on energy efficiency are required to announce the energy-saving projects that they have planned for a specified reporting period in an Energy Efficiency Plan (EEP). All projects with a payback period less than 5 years should be implemented. The aim of this paper is to provide insight into the differences in planning and implementation of energy efficiency investments by companies. This analysis is based on the EEPs submitted in the period 2009-2012. By comparing the characteristics of projects that have been implemented with those that were planned, insight is gained in the adjustments that companies make in their energy efficiency investment plans. We look at external circumstances that could explain these adjustments. Our results show that over 12,000 projects have been planned by the 904 long-term agreement (LTA) participants, about half of which are planned 'certain', which means that companies are certain that these projects will be implemented. However, we find a large difference between the planned and realised savings of companies and a huge variation in the payback period of both planned and implemented projects. We do not find a correlation between implementation rate and payback period. This suggests that the payback period in the EEPs was not assessed properly or that other than economic motives are more decisive for investment decisions. Our results can be used to improve the effectiveness and efficiency of voluntary agreements.