New EU Energy Label Explained – Energy Efficiency Marking for Home Appliances and Electrical Goods

[tweetmeme http://www.URL.com%5D Update: the full text of the new Directive that came into force can be found in this related post.

The European Parliament adopted a directive revamping the way electrical products are labeled in terms of energy efficiency.  This directive has been formally adopted and is expected to be published in the Official Journal in June, at which time it will come into force.  Member States will have one year to transpose it into national legislation.  But, what does it mean for manufacturers and consumers?

Background Information

The first Energy Labelling Directive was adopted in 1992 and the label became one of the instruments for fostering energy efficiency products. The revamped Directive aims to extend its scope beyond the household sector and have more energy efficient products. Energy Labelling and Ecodesign measures are seen as contributing significantly towards the EU target to improve energy efficiency by 20% by 2020.  An example of the old style label for a washing machine is given to the right of this post.

Up till now, most major appliances and light bulb packaging had to have an EU Energy Label clearly displayed when offered for sale or rent. The energy efficiency of the item was rated in terms of a set of energy efficiency classes from A to G on the label, A being the most energy efficient, G the least efficient.  This system was defined under several EU directives and implemented in national legislation in each EU Member State.

Some critics of the old labels argued that the labels did not take account of advances in energy efficiency engineering and the scale should be expanded.

The New Labels

With the new directive, the existing labelling scale from A-G will be further differentiated by adding the new classes A+, A++ and A+++ on top of class “A”.  Critics of the new label state that it will only confuse consumers and the older system of simply “buying A” was more clear and concise.  These same critics say that the European Commission only caved in to pressure from manufacturers seeking a new marketing gimmick.

However, the EU believes that the new scale will further increase competition between manufacturers for the benefit of the consumer and of climate change mitigation. It will also help them to advertise their products better. The Directive foresees that advertisement containing energy-related information or price must include a reference to the energy efficiency class of the product. This helps consumers to assess the running costs when buying new household appliances.

Based on the Directive, the Commission will identify a number of products in the commercial and industrial sector with energy-saving potential which will also fall under the new labelling system.  New products such as televisions, water heaters and boilers are planned to be adopted under the new labelling rules.

Under the new legislation, the layout of the energy efficiency label will allow for up to three new energy classes, to reflect technological progress, but will still limit the total number of classes to seven. The present scale is from “A” to “G”, so in future it will probably evolve as follows:

– If a new product using less energy than existing ones is classified as “A+”, then the least energy efficient class will be “F”,

– If a new product using less energy than existing ones is classified as “A++”, then the least energy efficient class will be “E”,

– If a new product using less energy than existing ones is classified as “A+++”, then the least energy efficient class will be “D”.

The labelling colour scheme – from dark green for most energy efficient products to red for least energy efficient ones – will be adjusted accordingly, so the highest energy efficiency class will remain dark green and the least energy efficiency one will be red.

The energy classes and the specific products that must labelled will be determined by a Commission working group.

Any advert mentioning the energy consumption or price of a specific model of household appliance will have to show the product’s energy class. Advertising with additional information should help consumers make a choice based on the energy savings potential of products to reduce their energy bill in the long run.

Similar provisions will apply to any technical promotional literature such as manuals and manufacturers’ brochures, whether printed or available on the internet.

Answers to Frequently Asked Questions

In order to address frequently asked questions regarding the new labelling scheme, the EU issued a memo (MEMO-10-202), giving these answers:

1. What does change under the new Directive?

The Directive sets out clearly that the label is to be based on a A-G scale, a maximum of 3 more classes may be added on top of class A and these new classes will be named A+, A++ and A+++. The new label layout will be easy to understand for consumers, as shown by the consumer survey carried out during the summer 2009.

The old Energy Labelling Directive from 1992 obliged manufacturers and retailers to provide consumers with labels indicating the energy consumption of household appliances. The recast of the Labelling Directive extends the new labelling scheme to a wider range of products in the commercial and industrial sector, including energy-using and energy-related products. It is also the legal basis to extend the scope to other consumer products such as televisions, water heaters and boilers.

2. Will the colours scheme of the label remain the same?

Yes. The highest energy efficiency class will remain dark green and the least energy efficiency one will be red.  (A sample of the layout of the new style label (also for a washing machine for ease of comparison) is presented to the left of this post.

3. Why was the scale of energy efficiency classes extended?

There was a need to go “beyond A” to allow manufacturers to further compete by developing products that are more and more efficient and to show how much better they are for consumers who could then make well informed choices.

4. What brings the new Directive for the consumer?

The Directive obliges the manufacturers to declare the level of consumption of their products. This allows consumers to make informed choices by being alerted on the running costs of a product before they make their purchasing decision. By buying more energy efficient appliances, consumers might pay higher upfront prices but make a profit on the lifetime of the appliance by saving on the running costs. If for example a typical medium sized gas domestic boiler (power input 22kW) is replaced by a high-efficiency boiler this could lead to an annual saving on fuel costs of about 250-300 € during a payback period of 5 to 6 years. The new scale will further increase competition between manufacturers given consumers even a better choice.

5. How can Energy Labelling contribute to the EU’s energy efficiency target?

It is estimated that the implementation of the Directive results in energy savings corresponding to 27 Mtoe (million tonnes of oil equivalent) annually by 2020, which translates into the annual abatement of 80 Mt of CO2 emissions or equivalent to the annual anticipated emissions of Austria in 2020.  Labelling has helped consumers to choose energy-efficient products. For example, for household’s washing machines and dishwashers in 1998 10 % of the appliances sold were in class “A”, whilst by 2005 some 90% washing machines and dishwashers were class “A”.

6. Which new products will be affected?

Products legislated in the near future are e.g. commercial refrigerators, vending machines and display cabinets in the commercial sector. Televisions, domestic refrigerators, dishwashers, washing machines, water heaters, boilers and air-conditioners for the household sector are planned for adoption by the Commission this year.

7. When will products under the new labelling regime enter the market?

The Commission will adopt delegated regulations for each product after the Energy Labelling Directive is published in the Official Journal of the European Union (OJ). The new label will be mandatory for products placed on the market from 12 months after the delegated regulation has been published in the OJ.

8. What is the benefit of the “energy- or price-related information” on a specific product for consumers?

The energy label helps consumers assess the running costs when buying new household appliances such as fridges, freezers, washing machines, driers, dishwashers, ovens, lamps and air-conditioners. Consumers can make even more informed purchasing decisions on the energy consumption of the product since advertisements draw their attention already to information that they will also find in shops and indirectly awareness on energy efficient products is also raised.

9. What is the benefit of the “energy- or price-related information” on a specific product for manufactures?

Any advertisement mentioning energy consumption or price of a specific model will have to show the product’s energy efficiency by reference to its energy class. Any technical promotional literature such as manuals and manufacturers’ brochures will have to indicate the product’s energy consumption or energy efficiency class. By this, manufacturers can differentiate their products even better.

More Detailed Information

Additional insight into the reasoning behind the introduction changes to a system that seemed to be working well can be found in the Commission staff working document – Accompanying document to the Proposal for a directive of the European Parliament and of the Council on the indication by labelling and standard product information of the consumption of energy and other resources by energy-related products – Impact assessment {COM(2008) 778 final}.  This very detailed 89 page document describes the flaws seen in the heretofore directive and the positive (and possible negative) impacts foreseen for the new text.  You may download the Impact Assessment in PDF from EUR-Lex by clicking here.

A mark-up version of the old text of the directive, showing the changes adopted may be read in PDF format by clicking here.

The text adopted by the European Parliament on 19 May 2010 can be accessed by clicking here (European Parliament legislative resolution of 19 May 2010 on the Council position at first reading with a view to the adoption of a directive of the European Parliament and of the Council on the indication by labelling and standard product information of the consumption of energy and other resources by energy-related products (recast) (05247/1/2010 – C7-0094/2010 – 2008/0222(COD)).

Citations:  Memo of the European Commission MEMO-10-202_EN, 19 May 2010, Press Release of the European Commission IP-10-584_EN.  Press release of the European Parliament of 19 May 2010 “New energy labels for household appliances; low-energy buildings from 2020”. New label image credited to the European Commission, sourced from the aforementioned press release.

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