THE DRAFT FRENCH ENERGY LAW AND WHITE CERTIFICATES SYSTEM

1. THE DRAFT FRENCH ENERGY LAW AND WHITE CERTIFICATES SYSTEM Robert ANGIOLETTI Head of MS2E Department March, 3rd 2005

2. WHITE CERTIFICATES : MAIN RULES (1) • Energy suppliers have to meet a target of energy savings (or pay a penalty) • They can implement actions or buy certificates • Over a threshold of savings, “eligible” bodies (building owners, companies, communities…) can made savings and get certificates • Energy savings must be “additional” 03/03/2005 - White certificates calculation with bottom up methodology

3. WHITE CERTIFICATES : MAIN RULES (2) • Obligations are given to electricity, gas, LPG, heat, cooling and heating suppliers • The savings can be made everywhere (except plants under CO2 quota Directive) => Whatever the sector, the supplier, the energy source… • WC added value when renewables are used and within some geographic (specific) zones 03/03/2005 - White certificates calculation with bottom up methodology

4. WHITE CERTIFICATES : MAIN RULES (3) • Target 54,7 TWh (discounted) For the first three years (2006/2008) • Obliged suppliers : sales > = 400 GWh/year ( still in discussion - level should be lower depending on nature of energy and market structures…) 03/03/2005 - White certificates calculation with bottom up methodology

5. WHITE CERTIFICATES : MAIN RULES (4) • Transaction costs can be reported in case of regulated tariffs • Expected cost : 10 €/MWh (max 20 €/MWh as penalty = 2 c€/kWh) • Minimal WC program size : 3 GWh (discounted 6 % rate, on life time of equipment and/or measure) 03/03/2005 - White certificates calculation with bottom up methodology

6. Main rules to integrate additionnality • All measures initiated by an “obliged” energy supplier are accepted • All measures operated by an “eligible” owner (building owner, industrial company …) for its own patrimony are accepted • For “other bodies” (manufacturers, traders…), measures are accepted only if : - No increasement of turn over, - If increasement of turn over, measure is an innovative product or service (to be defined) 03/03/2005 - White certificates calculation with bottom up methodology

7. Bottom-up methodology (1) These methodologies apply only for standard elementary measures They are still under discussion EXEMPLE • Application sector : Heating in residential sector • Name of elementary measure : Installing a condensing boiler • Definition of a reference consumption for a typology of houses using criterions to disaggregate (depending on kind of measure) : . Type of house, year of construction and heating energy (Cmch) . Climatic degree-days (c1) . House size (c2) 03/03/2005 - White certificates calculation with bottom up methodology

8. Bottom-up methodology (2) • Definition of a reference consumption, issued from statistical surveys, applied to the typology : Average heating consumption Cmch (kWh/year) 03/03/2005 - White certificates calculation with bottom up methodology

9. Bottom-up methodology (3) • Climatic correction coefficient : c1 03/03/2005 - White certificates calculation with bottom up methodology

10. Bottom-up methodology (4) Cref = Cmch * c1 * c2 (kWh/year) 03/03/2005 - White certificates calculation with bottom up methodology

11. Bottom-up methodology (5) • Definition of a reference situation and calculation of part of energy savings in % = ∆ŋ % energy savings are calculated by difference between real efficiency of the new boiler (measure) and the average efficiency of total boiler’s market (sales = M) ∆ŋ = ŋc - [ (Ms * ŋs + Mlt * ŋlt + Mc * ŋc]/ ΣM (s+lt+c) 03/03/2005 - White certificates calculation with bottom up methodology

12. Bottom-up methodology (6) ES = energy savings ES = Cref * ∆ŋ(kWh/year) ES = Cmch * c1 * c2 * ∆ŋ 03/03/2005 - White certificates calculation with bottom up methodology

13. Bottom-up methodology (7) White certificate value : • ES ( kWh/year) • Life time of the measure : e.g. LT = 15 y. • Discount factor : f = 0,647 for LT =15 y. and 6% rate WCvalue = ES * LT * f (kWh) 03/03/2005 - White certificates calculation with bottom up methodology

14. Standard elementary measures For building sector • Roof insulation, wall insulation, efficient glazing, ground insulation… • Low temperature boiler, condensing boiler, heat pump, temperature controls, thermostatic valves… • CFLs, A+ refrigerator, A+ washing machine, public lighting … 03/03/2005 - White certificates calculation with bottom up methodology

15. Standard elementary measures For industry • High efficiency motor, boiler… • Heat recuperation on boiler smokes and compress air system… • Electronic speed variation motor, • Efficient lighting system, • Efficient cooling and freezing system… 03/03/2005 - White certificates calculation with bottom up methodology

16. Standard elementary measures For transport • Combined transport container • Bus driver training • Clean vehicle • Green puncture • Recuperation on brake energy 03/03/2005 - White certificates calculation with bottom up methodology

17. Standard elementary measures Energy efficiency services and performance contracting (EPC) • Steam, heating, cooling, electricity systems and equipment for industry • Steam, heating, cooling, electricity systems and equipment for buildings 03/03/2005 - White certificates calculation with bottom up methodology

18. Expected Schedule • March 2005 : Law approval • Summer 2005 : Application decrees approval • End 2005 : Standard elementary measure’s saving values publication • January 2006 : Launching WC scheme 03/03/2005 - White certificates calculation with bottom up methodology

19. Bottom-up methodology Thank you for attention 03/03/2005 - White certificates calculation with bottom up methodology