Part 1: Energy Efficiency Act (EnEfG) - New legal requirements for companies

In its plenary session on Thursday, 25 May 2023, the Bundestag debated the draft bill on increasing energy efficiency and amending the Energy Services Act (EnEfG) (Drucksache 20/6872) for the first time. Afterwards, the bill was referred to the Committee on Climate Protection and Energy for lead consultation.

In order to implement Europe-wide efforts to combat climate change, the German Federal Ministry of Economics and Climate Protection recently presented a draft bill that aims to drastically increase energy efficiency. The law implements the requirements of the current amendment to the EU Energy Efficiency Directive at the national level and is intended to contribute significantly to achieving national climate goals. The goal is to reduce Germany's final energy consumption by 26.5% compared to 2008 at least by 2030. The draft was approved by the federal government on 19 April 2023. The second and third readings in the Bundestag, as well as the final vote on the draft, are scheduled to take place as early as 22 and 23 June 2023.

 

Final energy savings obligation of the federal government and the Länder

First of all, both the federal government and the federal states are obliged to implement energy-saving measures. The federal government is to achieve an annual final energy saving of 45 TWh and the federal states of 5 TWh. The amount of energy to be saved will be set as an individual percentage for each federal state. In addition, public bodies with a total annual energy consumption of more than 1 GWh are obliged to introduce an energy or environmental management system to reduce their total annual final energy consumption by 2%.

 

What is important for your business now

The regulations for companies are based on their energy consumption. For example, companies whose annual average total final energy consumption of the last three years is more than 15 GWh must introduce an energy or environmental management system no later than 20 months after the law comes into force. In addition, economic energy efficiency measures as well as measures for waste heat recovery must be recorded in plans and published if the annual average total final energy consumption of the last three years is more than 2.5 GWh.

According to the fifth section of the draft, companies will also be obliged to avoid the waste heat generated according to the state of the art and to reduce the waste heat generated to the proportion of technically unavoidable waste heat. In addition, there is to be an obligation to use the waste heat as far as this is possible and reasonable. There are exceptions for companies if the annual average total final energy consumption of the last three years is 2.5 GWh or less.

 

Focus on energy-efficient data centres

Due to their particularly high energy consumption, the planned law subjects data centres to special measures to increase energy efficiency in the fourth section. Thus, in addition to the general regulations for companies, high energy efficiency standards, a minimum temperature for air cooling as well as mandatory waste heat utilisation are planned. Furthermore, a fixed share of electricity is to be obtained from renewable energies.

In its statement of 12 May 2023, the Bundesrat recommended deleting the provisions on air cooling, but the federal government did not follow this recommendation in its counterstatement.

Furthermore, the Bundesrat criticised in particular the lack of compensation by the federal government for the expected additional financial expenses of the federal states and municipalities. In addition, the inclusion of grandfathering provisions is demanded in order to avoid serious negative consequences, especially for data centres in the public sector. The Federal Government has not agreed to the aforementioned proposals of the Bundesrat.

 

Where do we go from here?

The EnEfG is effective soon and it will have a significant impact on companies, which will have to make additional investments in technologies and infrastructure to improve their energy efficiency in order to meet the new legal requirements. Even though there is still a lot of discussion in the legislative process about the cost-bearing, design and implementation of the EnEfG in detail: The law represents an important step towards a sustainable future for Germany and the European Union.

In our second part, "Energy Efficiency Act - New legal requirements for data centres," you can read which regulations apply to data centres under the draft bill for the Energy Efficiency Act (EnEfG-E).