Table of contents

1.Introduction: Political and legal context

1.1.Benefits of Ecodesign and Energy Labelling

1.2.Legal framework

1.3.Legal context of the reviews

1.4.Political Context

2.Problem definition

2.1.Problem 1: Outdated energy efficiency requirements

2.2.Problem 2: Poor ‘Circular Economy’ performance

2.3.Problem 3 – Loopholes and less appropriate requirements for some technologies

2.4.General market failures

2.5.Who is affected?

2.5.1.    Household refrigerating appliances’ manufacturers and retailers    

2.5.2.    Recycling industry    

2.5.3.    Consumers    

2.5.4.    Society as a whole    

3.Why should the EU act?

3.1.Legal basis

3.2.Subsidiarity: Necessity of EU action

3.3.Subsidiarity: Added value of EU action

4.Objectives: What is to be achieved?

4.1.General objectives

4.2.Specific objectives

5.What are the available policy options?

5.1.What is the baseline from which options are assessed?

5.2.Description of the policy options

5.2.1.    Option 1 – Baseline    

5.2.2.    Option 2 – Least Life Cycle Cost (“LLCC”)    

5.2.3.    Option 3 – Ambitious    

5.2.4.    Option 4 – Lenient    

5.3.Options discarded at an early stage

5.3.1.    Voluntary agreement by the industry    

5.3.2.    LLCC with stricter timing    

6.What are the impacts of the policy options?

6.1.Environmental impact

6.1.1.    Final energy savings    

6.1.2.    GHG-emissions    

6.1.3.    Circular Economy perspective    

6.2.Business impacts

6.2.1.    Business revenue    

6.2.2.    Innovation, Research and Development, Competitiveness    

6.2.3.    Compliance costs    

6.2.4.    Intellectual Property Rights    

6.2.5.    Stranded investments    

6.3.Consumer expenditure

6.4.Administrative burden

6.5.Social Impact

6.5.1.    Affordability    

6.5.2.    Health, Safety and Functionality Aspects    

6.5.3.    Employment    

6.6.Linearity of the impacts in between the LLCC and ambitious options

7.How do the options compare?

7.1.Summary of the impacts

7.2.Market Surveillance

7.3.Assessment in view of Article 15(5) of the Ecodesign Framework Directive

7.4.Assessment in view of the objectives

8.Preferred option

8.1.Preferred option – Why?

8.2.REFIT (simplification and improved efficiency)

9.How will actual impacts be monitored and evaluated?

Annex 1: Procedural information

Annex 2: Stakeholder consultation

Annex 3: Who is affected and how?

Annex 4: Analytical methods

Annex 5: Minutes of the consultation forum

Annex 6: Employment and Market in the household refrigerating appliances sector

Annex 7: The Ecodesign and Energy Labelling Framework

Annex 8: Existing Policies, Legislation and Standards affecting household refrigerating appliances

Annex 9: Evaluation of the Ecodesign and Energy Labelling Regulations for household refrigerating appliances

Annex 10: Problem drivers

Annex 11: LLCC scenario

Annex 12: Analysis of the impact details

Annex 13: Glossary

Annex 14: List of Figures

Annex 15: List of Tables

This report commits only the Commission’s services involved in its preparation and does not prejudge the final form of any decision to be taken by the Commission.

1.Introduction: Political and legal context

This impact assessment relates to the review of Commission Regulation (EC) No 643/2009 1 on the ecodesign requirements for household refrigerating appliances and Commission Delegated Regulation (EU) No 1060/2010 2 on the energy labelling requirements for household refrigerating appliances.

1.1.Benefits of Ecodesign and Energy Labelling

Ecodesign and energy labelling are recognised globally as one of the most effective policy tools in the area of energy efficiency. They are central to making Europe more energy efficient, contributing in particular to the ‘Energy Union Framework Strategy’ 3 , and to the priority of a ‘Deeper and fairer internal market with a strengthened industrial base’ 4 . Firstly, this legislative framework pushes industry to improve the energy efficiency of products and removes the worst-performing ones from the market. Secondly, it helps consumers and companies to reduce their energy bills. In the industrial and services sectors, this results in support to competitiveness and innovation. Thirdly, it ensures that manufacturers and importers responsible for placing products on the European Union (EU) market only have to comply with a single EU-wide set of rules.

It is estimated that by 2020, ecodesign and energy labelling regulations will deliver around 175 Mtoe (i.e. about 2035 TWh) of energy savings per year in primary energy in comparison to if there were no measures in place. This is roughly equivalent to Italy's energy consumption in 2010, close to half the EU 20 % energy efficiency target by 2020 and about 11 % of the expected EU primary energy consumption in 2020 5 .

The average household will invest in more expensive and efficient products, but in return saves about € 500 annually on its energy bills by 2020. Although the cost for industry, service and wholesale and retail sectors will increase, it will result in EUR 55 billion per year of extra revenue by 2020.

This legislative framework benefits from broad support from European industries, consumers, environmental non-governmental organisations (NGOs) and Member States (MSs), because of its positive effects on innovation, increased information for consumers and lower costs, as well as environmental benefits.

Household refrigerating appliances have been subject to EU energy labelling measures since 1995 and minimum energy efficiency requirements since 1999. Since then, the energy consumption and carbon emissions have reduced with more than 60% compared to business as usual (BAU), the administrative burden has been modest and market actors are positive on the impact of these instruments on the market 6 .

1.2.Legal framework

In the EU, the Ecodesign Framework Directive 7 sets a framework requiring manufacturers of energy-related products to improve the environmental performance of their products by meeting minimum energy efficiency requirements, as well as other environmental criteria such as water consumption, emission levels or minimum durability of certain components before they can place their products on the market.

The Energy Labelling Framework Regulation 8 complements the Ecodesign Framework Directive by enabling end-consumers to identify the better-performing energy-related products, via an A-G/green-to-red scale 9 . The energy label is recognised and used by 85% of Europeans 10 .

The legislative framework builds upon the combined effect of the two aforementioned pieces of legislation. See Figure 1 for a visualisation of this effect.

Figure 1: Synergetic effect Ecodesign and energy labelling

For those consumers that do not use the energy label to select a product and for consumers in a tenant-landlord situation (where the landlord buys the refrigerating appliance and the tenant pays the bill), ecodesign requirements are important, as it safeguards consumers from the worst performing products.

The Ecodesign framework Directive and the Energy Labelling framework Regulation are implemented through product-specific implementing and delegated regulations. To be covered, the energy-related products must (i) represent a significant volume of sales (more than 200000 units a year), (ii) have a significant environmental impact within the EU and (iii) represent a significant energy improvement potential without increasing the cost excessively, see also Article 15.2 of the Ecodesign Framework Directive.

As an alternative to the mandatory ecodesign requirements, voluntary agreements or other self-regulation measures can be presented by the industry, see also Article 17 of the Ecodesign Framework Directive. If certain criteria are met the Commission formally recognises these voluntary agreements 11 . The benefits are a quicker and more cost-effective implementation, which can be more flexible and easier to adapt to technological developments and market sensitivities

For more details about the legal framework, including a full list ecodesign and energy labelling measures, see Annex 7.

Under this framework, household refrigerating appliances are regulated by Commission Ecodesign Regulation (EC) No 643/2009 and Commission Delegated Energy Labelling Regulation (EU) No 1060/2010. The scope of these measures are:

·household refrigerating appliances with a volume smaller than or equal to 1500 l (including wine storage appliances and mini-bars).

Included in the scope are also:

·household refrigerating appliances sold for non-household use, e.g. chest freezers, or for the refrigeration of items other than foodstuffs, e.g. refrigerating appliances used for storage of medicine;

·electric mains-operated household refrigerating appliances that can be battery-operated, e.g. mini fridges that can be powered by electricity from the gird or by battery.

The EU Ecolabelling Regulation (Regulation (EC) 66/2010 12 ) complements ecodesign and energy labelling. It is a voluntary scheme that awards products with the best environmental performance throughout their lifecycle. Products that fulfil the criteria can bear the EU ecolabel, see Figure 2.

Since 2011, household refrigerating appliances are no longer covered by the Ecolabelling Regulation 13 , because the ecolabel did not bring clear benefits in comparison to the energy label.

An overview of existing policies, legislations and standards affecting household refrigerating appliances in the EU and outside is given in Annex 8.

Figure 2: The EU Ecolabel

1.3.Legal context of the reviews

Article 7 of the Ecodesign and Energy Labelling Regulations for household refrigerators requires both regulations to be reviewed in the light of technological progress no later than five years after their entry into force. This review should in particular assess the verification tolerances of Annex V and the possibilities for removing or reducing the values of the correction factors of Annex IV.

Moreover, the Ecodesign working plan 2016-2019 14  also includes the review of both regulations, requiring in particular to examine how aspects relevant to the circular economy can be assessed and taken on board. This is in line with the Circular Economy Initiative 15 , which concluded that product design is a key in achieving the goals, as it can have significant impacts across the product life cycle (e.g. in making a product more durable, easier to repair, reuse or recycle).

Finally, in August 2017, the new Energy Labelling framework Regulation (EU) 2017/1369 entered into force, repealing Directive 2010/30/EU 16 . Under the repealed Directive, energy labels were allowed to include A+ to A+++ classes to address the overpopulation of the top classes. Over time, due to technological development, also the A+ to A+++ class became overpopulated, thereby reducing the effectiveness of the labels significantly. To resolve this, the new framework regulation requires a rescaling of existing energy labels, back to the original A to G scale. Article 11 of the Energy Labelling framework Regulation lists 5 priority product groups for which new delegated acts with rescaled energy labels must be adopted at the latest on 2 November 2018. Household refrigerating appliances is one of the priority product groups.

1.4.Political Context

Several new policy initiatives indicate that ecodesign and energy labelling policies are relevant in a broader political context. The main ones are the Energy Union Framework Strategy, which calls for a sustainable, low-carbon and climate-friendly economy, the Paris Agreement 17 , which calls for a renewed effort in carbon emission abatement, the Gothenburg Protocol 18 , which aims at controlling air pollution, the Circular Economy Initiative 19 , which amongst others stresses the need to include reparability, recyclability and durability in ecodesign, the Emissions Trading Scheme (ETS) 20 , aiming at cost-effective greenhouse gas (GHG) emissions reductions and indirectly affected by the energy consumption of the electricity using products in the scope of ecodesign and energy labelling policies, and the Energy Security Strategy 21 , which sets out a strategy to ensure a stable and abundant supply of energy.

2.Problem definition

2.1.Problem 1: Outdated energy efficiency requirements 

The problem: The current ecodesign requirements for household refrigerating appliances no longer capture cost-effective energy savings, and the current energy label no longer allows consumers to effectively differentiate sufficiently between the appliances on the market.

Since the entry into force of the current Ecodesign and Energy Labelling Regulations in 2009 and 2010 respectively, the energy efficiency of household refrigerating appliances has increased significantly. In the period 2010-2015, the average energy use of a household refrigerating appliance decreased from 242 kWh/a to 201 kWh/a 22 (see also Annex 12.2). Today, they can easily 23 achieve the existing ecodesign limits and all models reside in the top 3 classes of the energy label.

The total electricity consumption of EU household refrigeration appliances decreased significantly from 120 TWh/a in 2005 to 86 TWh/a in 2015 (40 %) 24 . This decrease happened notwithstanding the fact that the net volume of refrigerating appliances increased with 1.2 % per year and number of refrigerating appliances in the market has increased from 291.4 million units in 2005 to 303.2 million units in 2015 (4% increase).

Despite the reduction in energy consumption, refrigeration appliances are still one of the largest electricity consumers in households (after electric water heaters and lighting, but before televisions, electric ovens, washing machines, dishwashers, etc.), see also Figure 3.

Figure 3: The energy consumption of household appliances versus other household appliances and lighting (Ecodesign Impact Accounting 2016) 25

The energy consumption of refrigerating appliances in comparison to the other ecodesign regulated products is shown in Figure 4.

In 2009, it was projected that the electricity consumption of household refrigeration appliances in a BAU scenario in 2030 would decrease to 57 TWh/a, assuming that the regulations are at least periodically updated, to ensure their effectiveness.

The 2016 Review study suggested that the electricity consumption of household refrigerating appliances could further decrease by an additional 10 TWh/a in 2030 to a level of 47 TWh/a by setting the Ecodesign requirements at the level of the Least Life Cycle Cost (LLCC).

Without an update of the energy label and ecodesign measures, they will lose their effectiveness. In addition, the search cost for energy conscious consumers will increase and the incentives for the industry to develop more energy-saving products will be lower.

Figure 4: The energy consumption of household appliances versus all ecodesign regulated products (Ecodesign Impact Accounting 2016) 26

The drivers of the problem:

Problem driver 1: Technological progress - Technology for household refrigerating appliances keeps evolving, thereby improving energy efficiency. At the time of entry into force, no models qualified for the A+++ energy efficiency class and the share of models qualifying for the A++ energy efficiency class was less than 10%. Today, the top 3 energy efficiency classes are overpopulated, with the share of models in the A+++ label being more than 11 %, and more than 40 % in the A++ class 27 . This makes it more difficult to distinguish between models. Moreover, the "A+", "A++" and "A+++" classes introduced by the Energy Labelling Framework Directive (Directive 2010/30/EU) 28 have shown to be less effective in persuading consumers to buy more efficient products than the A to G scale. 29  

Problem driver 2: Outdated calculations - The existing energy efficiency calculations do not or no longer properly account for the real-life performance of modern refrigerating appliances. This is because some of the correction factors used in the metrics are outdated, others are used as loopholes and several cloud the real energy efficiency of the appliances.

Problem driver 3: New global standard - A new International Electrotechnical Commission (IEC) standard for household refrigerating appliances, IEC 62552:2015, was published in 2015. This standard aims to be universally applicable, more efficient, more accurate and more reliable than the one currently used in the regulations, and the requirements applicable to products sold in the EU should be updated to take this new standard into account.

2.2.Problem 2: Poor ‘Circular Economy’ performance

The problem: The current Ecodesign and Energy Labelling Regulations lack requirements that contribute to Circular Economy objectives, such as for reparability, recyclability and food waste prevention. The existing requirements focus mainly on energy efficiency improvements as the most significant environmental impact during the life-cycle of household refrigerating appliances.

Better design can make products more durable or easier to repair, upgrade or remanufacture. It can help recyclers to disassemble products in order to recover valuable materials and components. Overall, it saves resources. The current market signals appear insufficient to make this happen, in particular because the interests of producers, users and recyclers are not aligned. In addition, reparability can be important to consumers, and products can contain valuable materials that should be made easier to recycle (e.g. rare earth elements in electronic devices). It is therefore essential to provide incentives for improved product design, while preserving the single market and competition, and enabling innovation through Ecodesign.

Improved reparability will maintain or extend the useful product life, but can also contribute to the product’s energy efficiency throughout its life.

It should however be noted that for refrigerating appliances the impact of the energy consumption is still the largest environmental impact with still enough potential for improvement.

Table 1 shows data about the failure rates in the UK and Germany 30 . For Germany the 13% is a significant increase from the 7% reported in the past. Thermostats/thermistors and electronics are the most frequent components to fail, while compressor failure is relatively rare (4% of repairs). (Review Study 2016)

Table 1: Failure rate of household refrigerating appliances in Germany (2012-2013) and the UK (2012)

The energy efficiency of a refrigerator or freezer diminishes by some 10% over a 15-16 year product life. This is caused by the aging of insulation foam material (diminished insulation value over time) and the wear and tear of door gaskets 31 (leading to ice build-up) and interior elements. Insulation foam materials cannot be replaced as they are integrated in the cabinet of the appliance. Door gaskets, on the other hand, could be replaced, but they are often fully integrated into the door and spare gaskets are often not available. (Review study 2016)

Recycling of household refrigerating appliances is regulated by the WEEE Directive 32 . Article 8(2) of this Directive includes a list of materials which need to be collected separately during the recycling process. Today, the design of household refrigerating appliances does not completely facilitate this process.

Another element relevant for material efficiency is food waste caused by spoilage and bad planning. Food production 'from farm to fork' constitutes almost 20% by weight of the EU's total Domestic Material Consumption (DMC). End-users, i.e. private households and food services, waste 18% of those resources. Of this end-use waste, 60% is due to food spoilage and bad planning and thus avoidable.

Refrigerating appliances store two-thirds of food and drinks prior to their consumption. They play an important major role in preventing food spoilage and could contribute to better planning by being designed for optimised food preservation. Over 85% of fridges only include a standard fresh food compartment at a temperature of +4 to +5°C (possibly next to a freezer compartment). For about half of the fresh food (and drinks) this is either too warm or too cold for optimal food preservation. The presence of a chiller (−1 to 0°C) and a cellar compartment (8-14°C) could increase the shelf-life, in days, with on average a factor 3 or 4.

The Complementary Study 2017 33 indicated that refrigerating appliances that are designed for optimised food preservation consume at least 20% more electricity than the average refrigerating appliance on the market today. To compensate for a 20% higher electricity consumption, it would be sufficient to save 2% on end-use waste 34 , 35 .

The current lack of requirements on Circular Economy aspects means that cost-effective improvements to the ‘circularity’ of these products are not captured and that consumers do not benefit from better reparable and more durable appliances that contribute to reducing food waste.

Without an update of the requirements, the problem is expected to remain as described above.

The drivers of the problem:

Problem driver 1/ Availability and replacements of spare parts: Currently no measures exist which regulate the availability of spare parts. The Review study 2016 suggests that a minimum availability of those spare parts that fail most frequently (i.e. thermostats and temperature sensors) or cause an efficiency loss (i.e. door gaskets) would be useful, also after the end of production of a model. If spare parts are available, it is often not clear to end-users where to order them and how to replace them. In some cases broken parts can simply not be replaced because they cannot be removed without damaging (e.g. the lamp and the lamp cover) or replacing a significant part of the appliance (e.g. the door gaskets versus replacement of the complete door). Consequently, appliances are often not repaired at all.

Problem driver 2/ Design for recycling: The recycling requirements in Article 8(2) of the WEEE Directive are not directly applicable to product manufacturers, they are applicable to recyclers. Hence manufacturers are not always incentivised to design their products in view of this requirement.

Problem driver 3/ Design for optimised food storage: When buying a refrigerating appliance, consumers make their decisions based on energy efficiency and price (Review Study 2016). For appliances with optimised design for food storage the energy consumption and price will be higher than for a comparable unit with only a fresh food storage compartment (at a temperature of +4 to +5°C). Hence, without taking action, the market uptake of these products will remain low.

2.3.Problem 3 – Loopholes and less appropriate requirements for some technologies 

The problem: The current regulations suffer from an unclear and technology-prescriptive scope, creating uncertainty as to whether some products are in or out of the scope of the current regulations, creating possible loopholes, and resulting in less appropriate requirements. This causes an unlevel playing field for industry, and Market Surveillance Authorities (MSAs) have difficulties to evaluate the scope and perform proper market surveillance.

For example, professional chest freezers, i.e. chest freezers not used in a household environment, are identical in practical terms to household chest freezers. By declaring these chest freezers as “professional”, manufacturers obtain that they are excluded from the scope of the regulations. Given that professional chest freezers are specifically excluded from the Ecodesign Regulation for Professional Refrigeration 36 , they are not in the scope of any ecodesign or energy labelling regulation, thereby creating a loophole. The total energy consumption of chest freezers sold in Europe is around 0.4 TWh/a 37 .

Mini bars are typically equipped with absorption refrigeration generators. These low noise refrigerating appliances are specifically designed to be installed in hotel rooms where guests sleep. The EU market for low noise refrigerating appliances including mini-bars amounts to 0.2-0.3 million units, consuming in total around 0.6 TWh/a.

While all mini-bars were intended to be in the scope of the current Regulation, the use of mini bars in a ‘commercial’ context (i.e. a hotel room) has led to confusion about their inclusion. Moreover, a German court 38  ruled in 2014 that they should not be considered household refrigerating appliances and hence are out of the scope of the current Regulations, creating further confusion.

Furthermore, the regulations categorise products on the basis of different technologies, e.g. ‘compressor’ or ‘absorption and other’ technology. This means that certain technologies, including new ones, are covered (e.g. thermo-electric) but with less appropriate requirements (i.e. making it too easy or too difficult to comply).

Without an update of the requirements, the problem is expected to remain as described above.

The drivers of the problem:

Problem driver 1: Unclear scope - the ambiguities in the scope of the current regulations result in uncertainty about the inclusion of certain products thereby creating potential loopholes.

Moreover, since the entry into force of the current Ecodesign and Energy Labelling Regulations for household refrigerating appliances, other ecodesign and energy labelling regulations have been published, or are in preparation, which have refrigerating appliances in their scope. Possible overlap or gaps between these regulations exist. Figure 5 shows the different Regulations with refrigerating appliances and the products in their scope which potentially overlap.

Figure 5: Existing and planned EU Ecodesign regulation of refrigerating appliances. Legend: CR=Commission Regulation, HT=High Temperature (+7°C), MT=Medium Temperature (-10°C), LT=Low Temperature (-35°C), CU=Condensing Units, WP=Ecodesign Working Plan, WD=Working Document presented to the Consultation Forum in 2015.

Problem driver 2: Technological progress - New technologies have been developed and are being developed in respect of refrigerating. Some of these have lower efficiencies, but have functional characteristics (e.g. they are mobile or are very silent) which justify their continued placing on the market. This technological progress results in technologies being covered but with less appropriate requirements.

A more detailed description of the problems and problem drivers is given in Annex 10. An evaluation of the regulatory measures is presented in Annex 9.

2.4.General market failures

In addition to the product specific problem drivers described in Sections 2.1, 2.2 and 2.3, some general market failures have been identified:

Myopic behaviour - Without up to date energy efficiency requirements and energy labels, economic actors (both business and private) will not choose the product that is the most cost-effective over the product's life-time. This is because economic actors are limited by the information they have, their knowledge about products, and the finite amount of time they have to make a decision.

Split incentives – Without up to date energy efficiency requirements, the guarantee that the products will be cost-effective over their life-time is lost. This is especially important for a certain group of consumers, in particular those in a landlord-tenant situations, in where the landlord buys the appliance and the tenant pays the energy bill.

Price reflection – The price of the products does not fully reflect the real environmental costs to society. Hence, without setting requirements that will improve the environmental performance of the product, the different actors in the life cycle of the appliance will not be incentivised to improve these aspects of the appliance.

2.5.Who is affected?

2.5.1.Household refrigerating appliances’ manufacturers and retailers

For manufacturers and retailers, the energy label is one of the main market drivers and an important quality feature 39 . Globally, the household refrigerating appliance industry is highly competitive, with Asian manufacturers rapidly expanding their global market share. For these latter manufacturers, product price is the main selling point. The energy label allows EU industry to distinguish itself based on quality and innovation rather than solely on price.

In 2015, the total employment in the household refrigerating sector in the EU was estimated at 166 000 jobs, around 19.4 million units were sold in the EU and the EU turnover was EUR 10.1 billion in consumer price. More information about employment and the size of the market of household refrigerating appliances can be found in Annex 6.

Important manufacturers with EU production facilities are Electrolux 40 , BSH 41 , Whirlpool 42 , Candy and Liebherr. Rapidly growing importers are Arcelik/BEKO of Turkey, and Samsung and LG of South Korea.

Household refrigerating appliances manufacturers usually make the main cabinet-components in-house (i.e. the blow-formed inner-liner, insulation, the folded steel coil cabinet, the roll-bonded or Z-bonded evaporator and the condenser). Refrigerator/freezer doors require a special production line, which may be made in-house or by an external supplier. Other parts, like interior-elements (glass-shelves, containers, lamps, etc.), compressors and electronics are likely to be bought from external suppliers, also outside the EU.

Almost all manufacturers are large companies. Small and Medium-sized Enterprises (SMEs) are only found in niche markets, such as wine storage appliances and related luxury refrigeration/conditioning (for cheese, chocolate, fur-coats; also humidors). Examples are Eurocave, Groupe FRIO (brands: Climadiff, Avintage, La Sommeliere), these SMEs compete with the large manufacturers such as Liebherr, Bosch and Haier. There is one large manufacturer (Dometic) for absorption appliances and a few SME-manufacturers in the minibar market with thermo-electric devices 43 . The European industry association is APPLiA.

In the traditional retail sector the position of larger retail chains such as Metro (Media Markt) and Carrefour is increasing. For built-in appliances (29 % of the market) kitchen suppliers are important. Internet sales exist but the growth rate, especially for the more expensive no-frost appliances, is not higher than for the other distribution channels of this product group. The European association for retailers are Independent Retail Europe and EuroCommerce.

2.5.2.Recycling industry

For recyclers, design requirements that facilitate the separate collection of the materials listed in Article 8(2) of the WEEE Directive would reduce the time needed and cost to disassemble and shred a household refrigerating appliance.

Recycling companies are situated all over the EU . Some of the bigger recyclers are Coolrec in the Netherlands and Belgium, SIMS in the UK and Derichebourg in France.

The recycling industry is represented by the European Recycling Industries’ Confederation (EURIC).

2.5.3.Consumers

For consumers, the energy label offers a unique opportunity to make an informed choice as to which products offer the best environmental and energy performance allowing them to save money in the long run. Ecodesign requirements safeguard consumers from the worst performing products.

Spare part availability improves the reparability of household refrigerating appliances. This ensures that consumers can have their appliances repaired, at least until the appliance reaches a lifetime equal to the simple payback period (6-7 years on average, see Annex 4.8) when the higher investment cost in a more efficient appliance is recuperated through lower electricity bills.

Avoiding food waste by improving functionality not only gives consumers the opportunity to contribute to a more sustainable society but could also save them on average EUR 125/year (Complementary study 2017).

Consumers are represented by the Bureau Européen des Unions de Consommateurs (BEUC) and the European Association for the Co-ordination of Consumer Representation in Standardisation (ANEC).

2.5.4.Society as a whole 

For society as a whole, ambitious policies in the area of energy efficiency are important tools to mitigate climate change. Effective and efficient energy labelling and ecodesign regulations contribute to achieving goals set in the Paris Agreement and they help achieve the 2030 EU climate goal.

Environmental organisations are represented by the European Environmental Citizens Organisation for Standardisation (ECOS), the European Environment Bureau (EEB), TopTen, the Collaborative Labelling and Appliance Standards Program (CLASP).

3.Why should the EU act?

3.1.Legal basis

The legal basis for acting at EU level through the Ecodesign framework Directive and the Energy Labelling framework Regulation is Article 114 and Article 194 of the Treaty on European Union and the Treaty on the Functioning of the European Union (TFEU) 44 respectively. Article 114 relates to the "the establishment and functioning of the internal market", while Article 194 gives, amongst others, the EU the objective "in the context of the establishment and functioning of the internal market and with regard for the need to preserve and improve the environment" to "ensure security of energy supply in the Union" and "promote energy efficiency and energy saving and the development of new and renewable forms of energy".

The Ecodesign Framework Directive and Energy Labelling Framework Regulation include a built-in proportionality and significance test. For the Ecodesign Framework Directive, Articles 15(1) and 15(2) state that a product should be covered by an ecodesign or a self-regulating measure if the following conditions are met:

·The product should represents a significant volume of sales;

·The product should have a significant environmental impact within the EU;

·The product should present a significant potential for improvement without entailing excessive costs, while taking into account:

o an absence of other relevant Community legislation or failure of market forces to address the issue properly,

oa wide disparity in environmental performance of products with equivalent functionality;

The procedure for preparing such measures are described in Article 15(3). In addition, the criteria of Article 15(5) should be met:

·No significant negative impacts on user functionality of the product;

·No significant negative impacts on Health, safety and environment

·No significant negative impacts on affordability and life cycle costs

·No significant negative impacts on industry’s competitiveness (including SMEs see Section 6.5.3).

The Energy Labelling Framework Regulation includes similar criteria for products covered by an energy label:

·The product group should have significant potential for saving energy and where relevant, other resources;

·Models with equivalent functionality should differ significantly in the relevant performance levels within the product group;

·There should be no significant negative impact as regards the affordability and the life cycle cost of the product group;

·The introduction of energy labelling requirements for a product group should not have a significant negative impact on the functionality of the product during use.

During the review process (Review study 2016), it was established that household refrigeration appliances fulfil the above eligibility criteria.

3.2.Subsidiarity: Necessity of EU action

Action at EU level gives end-users the guarantee that they buy an energy efficient product and provides end-users with harmonised information no matter in which MS they purchase their product. This is becoming all the more relevant as the online trade increases. With ecodesign and energy labelling at EU level, energy efficient products are promoted in all MSs, creating a larger market and hence greater incentives for the industry to develop them.

It is essential to ensure a level playing field for manufactures and dealers in terms requirements to be met before placing an appliance on the market and in terms of the information supplied to customers for sale across the EU internal market. For this reason EU-wide legally binding rules are necessary.

Market surveillance is carried out by the MSAs appointed by MSs. In order to be effective, the market surveillance effort must be uniform across the EU to support the internal market and incentivise businesses to invest resources in designing, making and selling energy efficient products.

Finally, Regulation (EU) 2017/1369 requires the Commission to update the current energy labelling regulation for fridges, in particular as regards rescaling the label to remove the A+ to A+++ classes.

3.3.Subsidiarity: Added value of EU action

There is clear added value in requiring minimum energy efficiency levels and energy label class limits at EU-level.

Without harmonised requirements at EU level, MSs would be incentivised to lay down national product-specific minimum energy efficiency requirements in the framework of their environmental and energy policies. This would undermine the free movement of products. Before the existing ecodesign and energy label measures were implemented, this was in fact the case for many products.

4.Objectives: What is to be achieved?

4.1.General objectives

Following the legal basis in the TFEU, the general objectives are to:

1.Facilitate free circulation of efficient refrigeration appliances within the internal market;

0.Promote competitiveness of the EU refrigeration appliances industry through the creation or expansion of the EU internal market for sustainable products;

1.Promote the energy efficiency of refrigeration appliances;

2. Contribution to the Commission's objective to reduce energy consumption by at least 30 % and domestic greenhouse gas (GHG) emissions by 40 % by 2030; implement the energy efficiency first principle established in the Commission Communication on Energy Union Framework Strategy; and

3.Increase energy security in the EU and reduce energy dependency through a decrease in energy consumption of household refrigeration appliances.

There are several synergies between these objectives. Reducing electricity consumption (by increasing the energy efficiency) leads to lower carbon, acidifying and other emissions to air. Tackling the problem at EU level enhances efficiency and effectiveness of the measure.

4.2.Specific objectives

The specific objectives of the policy options considered in this impact assessment are to correct the problems identified in the problem definition (Section 2):

1.Update the energy efficiency requirements and the energy label in line with international and technological developments, and the revised Energy Labelling framework Regulation, to achieve cost-efficient energy savings;

2.Contribute towards a circular economy in the EU by including requirements on spare part availability, recyclability and food waste reduction;

3.Redefine the scope to close potential loopholes and adopt a technology neutral approach.

These objectives will drive investments and innovations in a sustainable manner, increase monetary savings for the consumer, contribute to the Energy Union Framework Strategy and the Paris Agreement, contribute to the Circular Economy Initiative and strengthen the competitiveness of EU industry.

5.What are the available policy options?

The procedure for identifying policy options follows from the Better Regulation Toolbox 45 . Specific measures in the policy options are the result of a combination of initiatives mentioned in the Review study 2016, the evaluation in Annex 9, the Inception Impact Assessment 46 , and inspiration taken from the Ecodesign Framework Directive and the Energy Labelling framework Regulation. They are aimed at addressing the issues identified in Section 3 and achieving the policy objectives defined in Section 4.

The policy options are listed in Table 2.

Table 2: Policy options

*Energy Efficiency Index (EEI)

Figure 6 shows the link between the problems, the drivers, the objectives and the measures proposed in this Section.

Figure 6: Link between the problems, drivers, objectives and the measures

5.1.What is the baseline from which options are assessed?

In the baseline, the current Ecodesign and Energy Labelling Regulations and all other relevant EU-level policies and measures are assumed to continue.

From 2020 onwards, lamps and electronic displays in household refrigerating appliances may be subject to ecodesign and energy labelling regulations. The impact assessment for the ecodesign and energy labelling regulations for both product groups 47 , 48 is ongoing. Hence, today it is too early to take the impact into account in the baseline.

According to the Energy Labelling framework Regulation, products have to be registered in the product database from 1 January 2019 onwards, for all products belonging to models placed on the market after 1 January 2019; and by 30 June 2019 for products belonging to models placed on the market between 1 August 2017 and 1 January 2019.

The requirement in the ETS to reduce emissions (from amongst other electricity production) will impact refrigerating appliances in a baseline scenario. Indeed, inefficient refrigerating appliances lead to more energy consumption. More electricity consumption increases the demand for ETS allowances. This either leads to higher ETS prices (which could in turn increase electricity prices) or to the need for additional emission reductions in ETS sectors (higher renewable energy targets or more reductions in industry).

International policies are being developed for household refrigerating appliances, based on the new global test standard (see Annex 10). This will impact household refrigerating appliances in the EU. If the EU lags behind, the competition in the EU might change focus from innovation and quality to price. In addition, the use of the global standard in ecodesign and energy labelling regulations will enhance global competition for EU manufacturers. The use of the EU standard in ecodesign and energy labelling will result in double testing of the products (according to the EU standard and the global standard), in which case EU manufacturers will be able to compete globally at an increased costs (due to increased testing). Alternatively, it will result in testing of the products according to the EU standard only, in which case they will not be able to compete on the global market. In the baseline, the impact of the new global test standard has been taken into account.

Sections 2.1, 2.2 and 2.3 describe how the situation will evolve in a baseline scenario in terms of energy savings, circular economy and scope.

5.2.Description of the policy options

5.2.1.Option 1 – Baseline

Option 1 forms the baseline for the impact assessment and is described in Section 5.1.

5.2.2.Option 2 – Least Life Cycle Cost (“LLCC”)

The LLCC scenario includes the following measures for the Ecodesign and Energy Label scope, test standard and metrics, energy efficiency limits and circular economy.

Table 3 shows the proposed measures under Option 2.

Table 3: Proposed measures under Option 2

Measures related to problem 1

Measure 1: Ecodesign energy efficiency limits - The LLCC scenario requires household refrigerating appliances to achieve maximum EEI levels as shown in Table 4. The EEI level applicable from 1 April 2024 corresponds to the LLCC point as determined in the Review Study 2016.

Table 4: LLCC - Overview of the maximum EEI values

According the Ecodesign Framework Directive, the level of energy efficiency or consumption must be set aiming at the life cycle cost minimum to end-users for representative product models, taking into account the consequences on other environmental aspects. This is level corresponds to the maximum EEIs in Table 4.

Measure 2: Updated energy Label – The Energy label will apply from 1 April 2021 onwards. The efficiency classes are set out in Table 5. The G class will be empty for standard household refrigeration appliances, but will be used for wine storage and low noise appliances that will have more lenient limit values. The A class is expected to be empty in 2021, this is in line with the new Energy Label Framework Regulation.

Table 5: LLCC - Energy efficiency classes

Table 6 gives an overview of the action that needs to be undertaken.

Table 6: LLCC, Energy efficiency requirements and Energy label - Who, what and by when

The increase of the energy efficiency requirements will result in 5% of the products currently on the market in being removed 2021 and 18% in 2024, compared to a BAU scenario (see Annex 12). This option is feasible in the given time frame. In return these requirements are expected to result in more business revenue for industry.

Stakeholder views – During the consultation forum, a stricter timing was proposed for the application of the stricter requirements, see Section 5.3.2. Some MSs and APPLiA commented that the combination of the ambition level and timing was too demanding. Most asked to postpone the application rather than to lower the ambition level. APPLiA was in favour of a lower ambition level 49 . Environmental NGOs and Switzerland requested for more ambitious efficiency levels 50 . All agreed that the timing for the measures should be sufficient to allow manufacturers to retest their appliances. When presenting this option to APPLiA, they agreed.

Measure 3: Test Standard - The test methods are in accordance with the European version of the IEC 62552:2015 standard. Table 7 gives an overview of the action that needs to be undertaken.

Table 7: LLCC, test standard – Actions: what, who and by when

Industry calculated that the total workload based on the available test capacity amounts to 14 months 51 . Assuming an entry into force on 1 April 2019, the proposed timing gives 24 months to retest. As such, the actions to be undertaken are feasible within the given time frame. In addition, this test standard aims to be universally applicable, faster and less costly, more accurate and more reliable. The use of the same standard in ecodesign and energy labelling will reduce the burden on the industry, improve the quality of the products and enhance global competitiveness.

Stakeholder views: None of the stakeholders were opposed to using of the new test standard. Although the new standard reflects real life conditions better, consumer and environmental NGOs would like to improve this even more. Some Member States were concerned that the new test conditions do not allow optimal food preservation; this was countered by APPLiA in a comprehensive way.

Measure 4: Updated metrics 52 - The reference lines 53 are made more flexible in design and are based on technology instead of sales and marketing. In addition, correction factors have been eliminated or reduced. The details, including the metrics, the full calculation method and a stochastic conversion table for the conversion from EEI values according to the harmonised standard (current EEI) to values according to the new global standard described in this Section (new EEI), are given in Annex 10.2.2. Table 8 gives an overview of the action that needs to be undertaken.

Table 8: LLCC, metrics - Actions: what, who and by when

The introduction of the new standard requires a recalculation of the EEI even without a change to the metrics. Therefore, the introduction of the new metrics is not an additional burden on the manufacturers, importers and suppliers. The new metrics reflect technological progress and improve the transparency.

Stakeholder views: The Open Public consultation (OPC) showed that stakeholders’ opinions are almost equally divided between the pros and the cons concerning the use of correction factors. In general, environmental and consumer NGOs prefer not to use them as they prefer full transparency. However, they welcomed the deletion of some and the reduction of other correction factors as did the other stakeholder. Most of the MSs that participated to the OPC are in favour of the correction factors. According to APPLiA the correction factors help consumers make sustainable choices in finite amount of time they have to make a decision.

Measures related to problem 2

Measure 5: Improved reparability - A requirement is added to ensure that spare part thermostats, temperature sensors and printed circuit boards are available 54 for a minimum period of 7 years (lifetime equal to the simple payback period) and that spare part door gaskets are available for a minimum period of 10 years. Table 9 gives an overview of the action that needs to be undertaken.

Table 9: LLCC, reparability - Who, what and by when

Manufacturers or their component suppliers will have to foresee more storage place for spare parts and/or foresee the possibility to produce them for a longer time. Industry indicated 55 that many EU manufacturers already ensure the availability of the necessary spare parts for white goods today. The impact for EU manufacturers is mainly expected on the models that are no longer produced. For non-EU manufacturers no information is available. In general, the impact is not expected to be big. Having spare parts available ensures that the appliance’s lifetime is at least sufficiently long to ensure that the higher investment cost in a more efficient appliance is recuperated through lower electricity bills and that the appliances remain efficient throughout their life.

Stakeholder views: All stakeholder are in favour of setting requirements on the availability of spare part door gaskets. With regards to the other spare parts, environmental and consumer NGOs, and some Member States, are in favour. For APPLiA, a declaration of the spare parts availability should be sufficient, as this is a driver for competition. This was also confirmed by the results of the OPC, where NGOs and individual citizens raised concern about the poor reparability of appliances, and where companies were cautious or negative about the requirements.

Measure 6: Enhanced recyclability - A requirement is added to ensure that key components (as per Article 8(2) of the WEEE Directive) can be safely and readily removed, and that lamps can be removed without permanent damage to the appliance. Table 10 gives an overview of the action that needs to be undertaken.

Table 10: LLCC, recyclability – Who, what and by when

In general, the EU household refrigerating appliance manufacturers work closely together with their recycling partners to fulfil the requirements laid down in the WEEE Directive. Therefore the impact of these requirements on the manufacturers is not expected to be onerous.

The benefits from improving the efficiency of recycling, on the other hand, reduces its costs and makes it more attractive. This is of benefit to all stakeholders, including industry who finances the collection, treatment, recovery and environmentally sound disposal of WEEE from private households. The requirements for lighting are included in this regulation instead of in the regulation lighting 56 to reduce the burden on manufacturers and make sure that different requirements on the refrigerating appliances apply at the same time.

Stakeholder views: Environmental and consumer NGOs, recycling industry and some Member States, strongly recommend including requirements in the regulation on recyclability. This was confirmed by the OPC. For APPLiA the proposed requirement is an acceptable.

Measure 7: Prevention of food waste - To prevent food waste, beneficial metrics for appliances that optimise their design for food preservation have been proposed. See Annex 11.2 for the full calculation method and Annex 11.3 for the changes to the metrics with regards to food waste, i.e. the use of a correction factor and the change in the target temperature of chill compartments. Table 11 gives an overview of the action that needs to be undertaken. To ensure that consumers are properly informed about correct food storage, requirements that inform consumers about the impacts of food waste, optimal food storage and the presence of compartments that optimise food preservation have been added. Those are:

(a)compartments should be marked with a symbol marking the type of food that should be stored in that compartment;

(b)instruction manuals for end-users and installers and free access website should include:

–clear guidance about where and how fresh food should be stored for the best preservation over the longest period;

–the recommended setting of temperatures in each compartment for optimum food preservation;

–an estimation of the impact of temperature settings on food waste;

(c)the energy label makes a differentiation between different compartments of the appliance, including those compartments that improve the food storage.

Table 11: LLCC, food waste – Who, what and by when

The introduction of the new standard requires a recalculation of the EEI even without a change to the metrics. Therefore, the introduction of the new metrics is not an additional burden on the manufacturers, importers and suppliers. These metrics, on the other hand, will promote an optimised design for food preservation which could help prevent food waste. The additional information requirements and the markings on the energy label will not create an additional burden, because measure 1 and 2 already require an update of the information requirements and energy labels. The marking of the compartments will create an additional burden, but the impact is not expected to be big, as most manufacturers already mark their compartments.

Stakeholder views: Most environmental NGOs, except for CLASP, and the consumer NGOs are not in favour of favourable metrics for appliances that potentially reduce food waste, because believe that there is not enough proof that an improved design guarantees food waste reduction. Several Member States and APPLiA are in favour and see it as a first step to tackle this problem. This was also confirmed by the OPC.

Measures related to problem 3

Measure 8: Refined scope - The present ambiguity in the scope is removed, firstly by defining the main functional (i.e. refrigerating appliances) and technology-neutral categories (i.e. low noise appliances and mobile refrigerating appliances), and secondly by expanding on what is in the scope and what is not. See Annex 11 for a more detailed description. This proposal clarifies was the intended scope, but does not change it. However, some manufacturers of professional chest freezers and mini-bars, including some SMEs, will have to make their products compliant. Table 12 gives an overview of the action that needs to be undertaken.

Table 12: LLCC, scope – Actions: what, who and by when

Most of the products produced by EU manufacturers, including SMEs active in the manufacturing of mini-bars, already comply with the regulations. Therefore, the impact is assumed to be moderate. Including these products in the scope will ensure that EU SMEs who invested in making their products compliant are protected, which reduces the unlevelled playing fields for all manufacturers.

Stakeholder views: All stakeholders agreed that the scope should be clarified. Environmental NGOs and some MSs requested to include professional chest freezers in the scope. The main manufacturers of mini-bars requested to clarify the scope for mini-bars. The OPC showed that most stakeholders are in favour of having mini-bars (low noise appliances) and appliances with glass doors in the scope.

5.2.3.Option 3 – Ambitious

The Ambitious scenario sets minimum energy efficiency limits at 25 % higher than LLCC-level for all refrigerating appliances except for low noise and wine storage appliances 57 , see Table 13. Otherwise, the Ambitious scenario is the same as the LLCC scenario. The actions that need to be undertaken are as described in Section 5.2.2.

Table 13: Ambitious – Maximum EEI values

The increase of the energy efficiency requirements will remove 48 % of the products from the market in 2021 and 20 % in 2024, compared to a BAU scenario behaviour (see Annex 12). This is feasible technologically, given that products with these EEI levels already exist in the market. However, the affordability for some European consumers may be affected. Business revenue for industry is expected to increase.

Stakeholder views: TopTen and other environmental NGOs have expressed interest in this ambitious scenario during the Review Study 2016. For example, Switzerland already applies the A++ level (current EEI=33) as a minimum requirement since 2014. Consumer NGOs requested a careful assessment of ambitious energy efficiency requirements to ensure that low income households can still afford household refrigerating appliances. In general, APPLiA is concerned about the number of products that would be removed from the market by setting ambitious EEI requirements. They presented the possible effects of the LLCC scenario with stricter timing (See Section 5.3.2) on MS with lower incomes to raise awareness about the effect of ambitious requirements.

5.2.4.Option 4 – Lenient

The lenient scenario sets minimum energy efficiency requirements 20 % lower than the LLCC scenario for all refrigerating appliances except for low noise and wine storage appliances 58 , see Table 14. Otherwise, the lenient scenario is the same as the LLCC scenario. The actions that need to be undertaken are as described in Section 5.2.2.

Table 14: Lenient - Maximum EEI values

The increase of the energy efficiency requirements will not remove additional units from the market as compared to the baseline (see Annex 12.1). As such, this will not result in additional business revenue.

Stakeholder views: Based on the proposal that was presented during the Consultation Forum (see Section 5.3.2), APPLiA argued for a more lenient level on the basis that costs were higher than originally estimated.

5.3.Options discarded at an early stage

5.3.1.Voluntary agreement by the industry

A voluntary agreement has to be given priority according to the Ecodesign Framework Directive, provided it meets the objectives in a quicker and more cost-effective manner. Today minimum mandatory requirements are already in force. Since no proposal has been put forward by industry, there is no voluntary agreement that meet the conditions of the Ecodesign Framework Directive. As a consequence, this option is discarded from further analysis. When substituting mandatory requirements by a voluntary agreement there would be a risk of free riders 59 , in case not all actors present on the market would sign such an agreement and comply with it.

Stakeholder views: None of the stakeholders are in favour of voluntary agreements for the reasons set out above.

5.3.2.LLCC with stricter timing

This option is the same as the LLCC scenario, but the application of the requirements are brought forward by one year as indicated in Table 15. This option was presented to stakeholders during the consultation forum.

Table 15: Time table LLCC versus LLCC with stricter timing

Stakeholder views: Almost all stakeholders, including some environmental NGOs, agreed that the timing in combination with the minimum requirements was too demanding. The main reasons that were mentioned were the need to retest all appliances. With an estimated entry into force on 1 April 2019, the time to retest would only be 12 months, while APPLiA calculated the time needed to retest to 14 months (see Section 5.2.2).

6.What are the impacts of the policy options?

The analytical methods used to determine the impacts are described in detail in Annex 4. Details about the share of products that would be removed from the market as a result of the different scenarios can be found in Annex 12.1.

The reparability, recyclability and food waste requirements introduced in the LLCC, ambitious and lenient options will not be quantitatively discussed. Indeed, due to the relatively small monetary and energy impacts involved (Impact Assessment Study 2018), their possible influence on the outcomes of a quantitative analysis would be smaller than the error margin of such an analysis (estimated at ±5%). A qualitative assessment is made in Section 6.1.3.

6.1.Environmental impact

6.1.1.Final energy savings

The final energy (i.e. electricity) savings per product placed on the market are described in Annex 12.2. Figure 7 shows the EU final energy consumption of the total population of household refrigeration appliances for the different scenarios. This excludes wine storage and low noise refrigerating appliances (0.3 TWh/a energy savings, see Annex 4).

Figure 7: EU energy consumption over the period 2005-2030, in TWh/a electricity, for various scenarios (Impact assessment study 2018)

The average lifetime of refrigerating appliances is 16 years, which means that it will take some time before the whole stock of products has changed. As such, there is only a small difference between the scenarios in 2020. The savings expected by 2030 for the different scenarios are given in Table 16. The savings of the baseline relative to 2015 are 14.3 TWh/a (16 %) in 2020 and 26.8 TWh/a (31 %) in 2030.

Table 16: Overview of the final energy consumption and savings, including from wine storage and low noise refrigerating appliances for each scenario in comparison to the baseline (Impact Assessment Study 2018)

Active energy policies will reduce the ETS price. However, this is justified because the ETS only tackles the price reflection based market failures (for electricity using products); market failures such as myopic behaviour and split incentives can only be tackled by these active energy policies.

Stakeholder views – See stakeholder comments on the energy efficiency requirements in Sections 5.2.2, 5.2.3 and 5.2.4.

6.1.2.GHG-emissions

The transition towards low-global warming potential (GWP), non-ozone depleting (ODP) refrigerants and foaming agents is practically complete for this product group (> 98 % isobutane for refrigerant, cyclopentane as foaming agent). As such, the trends for GHG-emissions are similar to the energy consumption trends. The main difference is that for the energy scenarios, by convention, a primary energy factor 60 of 2.5 (according the Annex V of the Energy Efficiency Directive (Directive 2012/27/EU 61 ), whereas for the projections of the GHG-emissions changes in carbon-intensity of electric power generation are taken into account.

Figure 8 shows the EU GHG-emissions of the total population of household refrigeration appliances for the different scenarios, this excludes wine storage and low noise refrigerating appliances (0.1 Mt CO2 eq./a GHG-abatement, see Annex 4).

Figure 8: EU greenhouse gas over the period 2005-2030, in Mt CO2 equivalent, for various scenarios

The GHG emission savings expected by 2030 for the different scenarios are given in Table 17. The savings of the baseline relative to 2015 are 7.2 Mt CO2 eq./a (21 %) in 2020 and 14 Mt CO2 eq./a (41 %) in 2030.

Table 17: Overview of the GHG emissions and savings, including from wine storage and low noise refrigerating appliances for each scenario in comparison to the baseline (Impact Assessment Study 2018)

Stakeholder views – Comments on the GHG-emissions from energy use are included in the comments on the energy efficiency requirements Sections 5.2.2, 5.2.3 and 5.2.4. On the emissions from refrigerants, environmental NGOs requested to include a requirement to avoid that hydrofluoro-olefins (HFOs) would be used in household refrigerating appliances.

6.1.3.Circular Economy perspective

The environmental life-cycle assessments in the Review Study 2016 show that the energy consumption and the related emissions are the dominant environmental impacts for this product category. For this reason, the circular economy requirements are limited only to those requirements that make sense from a life cycle perspective.

Note that the options do not differentiate between these material resources measures, i.e. they are all part of all options, except the baseline option.

Design for optimised food storage - For material resources efficiency, reduction of food waste through better, more specific preservation is the most important element.

The beneficial metrics for appliances that optimise their design for food preservation lead to lower EEI values (higher efficiencies). However in reality, the energy consumption of the appliances will be higher (at least 20 % higher, see also Section 2.2) and the real savings are expected through the reduction of food waste.

The Complementary Study on food waste concluded that with optimal storage conditions the current food waste due to ‘not-used-in time’, estimated at 23 Mt/year (EU 2011-2012), can be reduced by almost 60% (13 Mt). An additional 20-25% (7-8 Mt) can be saved on food waste from leftovers and too much food prepared or served (leftovers) etc. by better preservation.

However, it is clear that measure alone will not solve the food waste problem. Several other barriers need to be overcome:

·consumer behaviour

·current product specific legislation on food preservation 62

·food labelling (e.g. expiry dates)

To steer the consumer behaviour some requirements have been added to inform them about the correct preservation of food, the impacts of food waste and the presence of compartments that optimise food preservation. Without a thorough study on consumer behaviour it is impossible to estimate whether these requirements are sufficient to trigger changes in consumer behaviour. Unfortunately, Ecodesign and Energy Labelling cannot regulate the influencing factors more than that. Therefore, it should be seen as a first step in that direction.

For these reasons, the beneficial metrics only conservatively decrease the EEI values (between 2 % and 5 %, depending on the number of doors, see Annex 11.3), they do not completely compensate for the 20 % increase in energy consumption.

In addition, the Complementary Study 2016 concluded that:

·it would be enough to only reduce the food waste with only 2% to compensated for the 20 % higher energy use (see also Section 2.2);

·the existence of different compartments ranging from -1 °C to 17 °C creates new energy savings opportunities, e.g. by capturing the ‘waste-cold’ from low-temperature compartments and defrosting;

·optimal food storage also keeps food healthier and tastier.

Hence, the measure makes sense from a broader environmental perspective.

Availability and replacement of spare parts - As a safeguard against the possible reduction of the product lifetime and also to maintain energy efficiency over time, the availability of spare part thermostats, temperature sensors, printed circuit boards and door gaskets is important.

Life time extension, including from re-use, is not useful seeing the large energy saving potential that still remains for this product group. Such requirements would stagnate the entry of new, more efficient models on the market. A period of 7 years for safeguarding the reduction in product lifetime and 10 years for maintain energy efficiency over time, is expected not to extend the life time which is on average 16 years.

Design for recycling - Finally, to facilitate recycling, the removability of key components as per Article 8(2) of the WEEE Directive is important.

Stakeholder views – See stakeholder views on circular economy in Section 5.2.2.

6.2.Business impacts

6.2.1.Business revenue

To achieve energy and carbon savings, industry has to invest. As such, the cost will be higher. In retail, with average wholesale- and retail margins (and Value Added Tax (VAT) assumed fixed 63 , the cost will also be higher. This will be translated into a higher price (in absolute euros) of the appliance, which will affect consumer expenditure. Consequently, the acquisition cost for the consumer will increase as a consequence of the policy scenarios (despite the assumption of a learning effect 64 of 1% for prices above the current base case level; see also Section 6.3 and Section 6.5.1). This investment leads to a higher revenue for the industry and retail sector, as indicated in Table 18.

Table 18: Overview business revenue per scenario, in billion Euro [2010**] (Impact Assessment Study 2018).

Option 1 - baseline - gives an increase of 0.3 billion Euros (Net Present Value 65  (NPV) 2010) in 2030 with respect to 2015. Option 2 - LLCC - gives an extra 7% in turnover (EUR 0.6 billion) in 2030. Option 3 - ambitious - gives an extra 21% (EUR 1.9 billion) in total business turnover. Option 4 - lenient - no increase with respect to baseline scenario.

Figure 9 shows the projected industry revenue for the different scenarios.

Figure 9: Projected industry revenue over the period 2005-2030, in Mt CO2 equivalent, for various scenarios (Impact assessment study 2018)

It is expected that the business revenue will not be impacted significantly by the rescaling, even with products in the A+ and the A++ class that will end up in the F and G class respectively.

This is because it is not the intention that manufacturers will keep on making the same products that will end up in the F and G class with competitive lower mark-ups. Today, due to the overpopulation of the top energy classes, energy efficiency improvement cannot be shown to the consumers and will therefore not be rewarded in the price of the model. It is expected that the measures will give sufficient incentive for manufacturers to improve the energy efficiency of their products (see also Section 6.2.2) as to reach the new A and B levels that can then be sold at a higher price.

The move toward more efficient appliances is also shown in Annex 12, Table 44, where in the period 2021 – 2025, the percentage of appliances in the F and G class are rapidly decreasing.

In addition, rescaling itself will have the same impact on all refrigerating appliances, their manufacturers and suppliers. All refrigerating appliances will bear the new energy label at the point of sales after the date of application without overlap. The impact assessment of the energy labelling framework regulation states that a period of overlap is likely to confuse consumers and lead to sales of less efficient appliances, although it is impossible to quantify by how much.

The introduction of the new energy labels will go together with information campaigns for consumers.

Stakeholder views – APPLiA commented that the disregarded scenario (see Section 5.3.2) would remove a large amount of products from the market. Such scenarios will require significant redesign which requires significant investment. Stakeholders did not comment on Business revenue.

6.2.2.Innovation, Research and Development, Competitiveness

The household refrigeration appliances industry spends approximately EUR 0.35 billion (3.8 % of its total turnover) on research and development (R&D) (APPLiA).

The revision of the household refrigeration appliance labelling regulation is expected to support innovation and drive market transformation, as was observed in the past. It is in line with ongoing market trends towards higher energy efficiency, where a high-energy label rating is a strong commercial driver (Review Study 2016).

However, it is not expected that the regulation will lead to any significant structural increase of R&D budgets, unless if the requirements do not take the normal pace of R&D into account. There is however a shift in priorities for the R&D budget, which is directed more towards e.g. energy efficiency improvements instead of e.g. new production techniques. The same goes for investments in new production lines for more efficient products. In addition, products meeting the requirements are already commercially available on the market.

Almost all manufacturers of refrigerating appliances are large companies. Hence, it assumed that they have the technological capabilities that allow them to reach the top label levels.

Impact will be most limited in option 4 - lenient scenario and most challenging in the option 3 - ambitious scenario. The option 2 - LLCC scenario is in line with the pace of innovation over the past period. To further keep the R&D expenditure at its normal pace, the proposed period between the application of the first and second tier of requirements is 3 years, whereas in the current Regulation this is 2 years.

The development of innovative energy-efficient technologies at competitive prices 66  will enhance the competitiveness of European manufacturers. This is important because Asian manufacturers are rapidly expanding their global market share. For these manufacturers, product price, rather than quality, is one of the main selling points.

The SMEs are protected by lower requirements for wine storage appliances and low noise appliances, these are the products they typically produce.

Stakeholder views – Stakeholders did not comment on Innovation, Research and Development, Competitiveness.

6.2.3.Compliance costs 

Ecodesign and energy label requirements for refrigerating appliances in the scope have a strong influence on the market and have been in existence for the last 20 years.

Research and development as well as production investments are common practice in the industry. Redesign would happen with or without new measures. As a consequence, the compliance costs and amongst others, the cost for redesign, are not expected to increase. Any potential extra cost is expected to be absorbed by the industry. With or without the measures, manufacturers will be obliged to test their products according to the new test method, otherwise they will not be able to compete on the global market. Therefore, costs from testing according to the new standard will be the same for all options, including the baseline. As regards the SMEs operating in some niche markets, the Commission proposals have done their utmost to minimise the burden (see Section 6.5.3).

The administrative burden of current and proposed measures is further developed in Section 6.4.

Stakeholder views - The ecodesign requirements have not led to complaints on extra costs that were not repaid, in the short or long run, by extra revenue.

6.2.4.Intellectual Property Rights

The technologies considered in all scenarios are commonly available to all major manufacturers.

Stakeholder views - No concerns were raised that the options would impose proprietary technology on manufacturers.

6.2.5.Stranded investments

The risk of stranded investments could exist for the least energy efficient appliances such as combi appliances with a single thermostat design (Type I). However, these products and their components have been introduced in the market in the 1960s and production lines and other capital costs have long been depreciated (written off).

Therefore, there are no risks on stranded investments.

Stakeholder view - APPLiA did not raise the issue of stranded investments.

6.3.Consumer expenditure

Consumer expenditure consists of acquisition costs, maintenance/repairs and running costs. For refrigerating appliances, the repair costs are modest (estimated in the order of EUR 0.5 billion/year) and are assumed to be included in the acquisition costs. The running costs are equal to the energy costs. For a detailed analysis of the acquisition cost and the energy cost, see Annex 12.3. The overall consumer expenditure (= sum of the acquisition and running costs) for the different scenarios are shown in Figure 10.

Option 1 - baseline - consumer expenditure rises by EUR 4.7 billion (17%) per year between 2015 and 2030. Option 2 - LLCC - saves the most in consumer expenditure, almost 3 billion Euros per year (9%) with respect to the baseline in 2030. Option 3 - Ambitious - The expenditure is considerably more than any other scenario over the period 2021-2030. Only in 2028 it drops below the baseline. In 2030 it drops to a level similar to the lenient scenarios in 2030. Option 4 – Lenient - The expenditure is lower than the baseline, but higher than the LLCC. A sensitivity analysis of the consumer expenditure is included in Annex 12.3.2.

Stakeholder views – APPLiA questioned the feasibility of the discarded scenario (see Section 5.3.2) in certain countries in terms consumer expenditure and affordability. Several eastern European MS also commented on the feasibility of this scenario with respect to consumer expenses and affordability. Consumer organisations stated that the ambitious option would eliminate a specific, very low-cost type of combi-appliance (Type I) which is believed necessary to serve low-income households.

6.4.Administrative burden

The administrative burden of new measures under the Energy Labelling Framework Regulation were calculated in the Impact Assessment for the Energy Labelling Framework Regulation. The costs for household refrigeration appliances are summarised in Table 19.

For ecodesign measures for products with an energy label, the above-mentioned impact assessment study considered that there was no additional administrative burden for industry, because there were vested commercial interests. More details are found in Annex 12.4

Table 19: Administrative burden in '000 euros (Impact Assessment Energy Labelling Regulation)

Stakeholder views – No comments were made on the administrative burden.

6.5.Social Impact

6.5.1.Affordability

In this Impact Assessment, affordability is based on the simple payback time of the appliance. The life cycle costs and payback time are based on EU28 average price values for, amongst others, electricity. For Member States with lower than average electricity prices, the payback time will be higher than this EU28 average payback time. To be affordable in all Member States, the EU28 average payback time is kept lower or equal than half of the lifetime of the product.

A sensitivity analysis of the life cycle costs (LCC) based on the data in the Review Study 2016 and the electricity prices in Germany and Romania, which are at the higher and lower end respectively of electricity prices in the EU can be found in Annex 12.

For option 2 – LLCC, on average the prices are projected to go up by 10-12 %, whereas the annual energy costs go down by 23-25 %. At the projected energy prices this means a simple payback period of 6 -7 years for an appliance that lasts on average 16 years. In other words, also for consumers with below-average income this is economically a worthwhile investment.

The risk that consumers would postpone the purchase of a new appliance exits. However, this behaviour has not been observed with the introduction of the current Regulations, therefore it is not considered here.

Moreover, with the introduction of the previous regulations for refrigerating appliances, the purchase price of refrigerating appliances did not change much. The industry managed to maintain the same average prices over the last 15 years. Only in the first two years, when not all manufacturers were capable of producing the highest energy label levels, there was a slight price increase, which subsequently disappeared.

Only in the case where the purchaser (e.g. a landlord) is not the one paying the energy bill (e.g. a tenant) the economic considerations for the purchaser may be different. Ecodesign measures are intended for just those situations, i.e. to ensure that a landlord or a short-time-user buys an appliance that meets at least a minimum efficiency level.

Stakeholder views – See stakeholder comments consumer expenditure, Section 6.3.

6.5.2.Health, Safety and Functionality Aspects

There are no specific health and safety aspects related to the measures analysed. There are no known negative impacts from using more efficient appliances as prescribed by the policy options.

Stakeholder views – Stakeholders did not report any negative impacts in this respect.

6.5.3.Employment

Total employment - The EU impact on employment is estimated from the increase in revenue and turnover per employee, this is the convention as per the MEErP methodology 67 . Table 20 gives an overview of the employment impact according to the boundaries described in Annex 12.5.

While there is some correlation between revenue and employment for a manufacturing industry, there are however other influencing factors (e.g. macro-economics, EU trade policy, strategy of EU companies to move workforce to low-cost countries outside the EU, etc.) which have not been taken into account in the impact modelling. Hence, the real job impacts are expected to be lower than indicated in the report.

Table 20: Overview direct employment per scenario, in ‘000 jobs (Impact Assessment Study 2018)

In Option 2 - LLCC and Option 3 – ambitious, approximately 11000 and 38000 jobs would be created, respectively, as compared to a baseline, equally divided between industry and trade. Option 4 - lenient - hardly any jobs would be created/retained as compared to the baseline.

SMEs - SME manufacturers of refrigeration appliances in the scope can only be found in niche markets such as minibars (low noise appliances) or customised wine storage appliances produced in one-off or small series for restaurants, bars or connoisseurs usually with glass doors, see also Section 2.5.1. Their market share in these niche markets may be 30-40%. Table 21 shows an overview of the estimated employment in SMEs involved in the production of refrigeration appliances in the scope.

Table 21: Overview of employment in SME industry involved in production, including suppliers (Impact Assessment Study 2018)

In order to retain these SME jobs, it is proposed to apply more lenient requirements for wine storage and low noise appliances. For wine storage and low noise appliances with glass doors even less stringent appliances are proposed, see also Section 5.2.2.

Stakeholder views – Stakeholders did not comment on the total employment. APPLiA and the MSs are in favour of more lenient requirements for wine storage and low noise appliances. For glass door appliances, this could be done either through a glass door correction factor (supported by several MS) or through separate requirements (supported by some MS and APPLiA). NGOs are not in favour of correction factors.

6.6.Linearity of the impacts in between the LLCC and ambitious options

In case that another option would be selected with an ambition level in between the LLCC and ambitious scenario, it should be noted that the impacts are not fully linear.

The expected cut off rate and the affordability for low income households are impacts that are only linear up to a certain point. According to industry and consumer associations, beyond a certain point (somewhere between the LLCC and the ambitious scenario), the impact is no longer linear.

The non-linearity originates from the need to increase R&D efforts and investments in new production lines higher than the normal development pace, see also Section 6.2.2 In this case, industry is confronted with considerably higher costs which they may or may not be able to carry. In addition, as regards to affordability, the price of refrigerating appliances will increase when the extra production costs can no longer be absorbed by a normal development pace. This risks that low-income families will no longer be able to afford a new refrigerating appliance. Instead, they will continue to use and repair their old energy inefficient refrigerating appliance longer than is environmentally responsible.

7.How do the options compare?

7.1.Summary of the impacts

Tables 22 and 23 summarise the impacts described in Section 0.

Table 22: Overview main annual impacts of the options. Best values (Bold), worst values (Italic) (Impact Assessment Study 2018)

Table 23: Overview main accumulative impacts of the options. Best values (Bold), worst values (Italic) (Impact Assessment Study 2018)

7.2.Market Surveillance

All proposed policy options would be subject to Article 15(8) of the Ecodesign Framework Directive, as well as Article 8(1) and (3) of Energy Labelling Framework Regulation, which requires that MSAs can verify the conformity of a product with all regulatory requirements.

The cost for market surveillance organised by MSs is the same for all options, i.e. EUR 330.000 annually, see Section 6.4.

Stakeholder views – APPLiA and other industry associations, have emphasised the importance of securing a sufficient level of market surveillance to ensure that only compliant products are placed on the market. In this respect, they call for increased enforcement by MSAs.

7.3.Assessment in view of Article 15(5) of the Ecodesign Framework Directive

Pursuant to Article 15(5) of the Ecodesign Framework Directive, future implementing measures should fulfil a number of criteria, see Section 3.1. An assessment of the options in view of these criteria and on the basis of Tables 22 and 23 is shown in Table 24.

Table 24: Evaluation of policy options in terms of their impacts compared to the baseline (Impact Assessment Study 2018)

Although option 3 - ambitious has the best values in most of the categories in Tables 22 and 23, it cannot be retained as the option for a future implementing measure because it does not fulfil the criterion ‘no negative impact on consumers’ of Article 15(5). The consumer expenditure in the short term is too high for the average consumer in terms of affordability and life cycle cost, i.e. the simple payback time is higher than half the lifetime of the product (see also Section 6.5.1.). In addition, the ‘x’ also refers to the fact that the option would eliminate a specific, very low-cost type of combi-appliance (Type I) that according to the consumer organisation is believed necessary to serve low-income households. Option 2 – LLCC and option 4 – lenient fulfil all criteria.

7.4.Assessment in view of the objectives

An assessment of the options in view the objectives in Section 4, on the basis of Tables 22 and 23, is shown in Table 25.

Option 4 - lenient does not contribute to the general objectives and only contributes to two out of three specific objectives. It is therefore not seen as an appropriate policy option. Option 1 – baseline does not contribute to any of the objectives. Option 3 – ambitious contributes to all objectives in the same way as option 2 – LLCC, except for the specific objective ‘Update the energy efficiency requirements and the energy label in line with international and technical developments’. Here the option goes beyond the international and technical developments. In any case, this option has been excluded based on the evaluation in Section 7.3. As a consequence option 2 – LCCC is the preferred option. More information on the benefits of option 2 are included in the next paragraph.

Table 25: Score of impacts against objectives. No Change (0), limited improvement (+), significant improvement (++). (Impact Assessment Study 2018)

*Innovation will enhance competitiveness of the EU manufacturers; the effect on innovation is therefore included in this objective.

**The promotion of energy efficient appliances for the ambitious scenario will be significantly higher than for the LLCC scenario. However, we should take into account that the risk exists that the market uptake of these more efficient appliances might be slower because they are unaffordable for low-income families.

***The contribution to the 2030 target increases with 0.16% for energy efficiency and 0.08% for GHG emissions for the ambitious scenario in comparison to the LLCC scenario. This does not make the difference between limited improvement and significant improvements.

8.Preferred option

8.1.Preferred option – Why?

Option 2 - LLCC fulfils the criteria in Article 15(5) of the Ecodesign Regulation and Article 16(2) of the Energy Labelling Regulation, see Section 3.1, and will achieve the objectives as set out in Section 5 in the best way, see Section 7.4.

By 2030, option 2 – LLCC will results in the following:

·Energy savings of 9.6 TWh/yr and GHG emission savings of 3.1 MtCO2eq./a, i.e. 0.66% of the Union’s 2030 target for final energy consumption savings and 0.25 % of the Union’s 2030 target for GHG-emissions savings;

·Savings on annual end-user expenditure of EUR 2.8 billion and extra business revenue of EUR 0.44 billion per year, which translates into around 11 000 jobs;

·An alignment with technological progress and global minimum energy efficiency requirements in other economies;

·Ensuring EU industry’s competitiveness and leading role as high-quality manufacturers;

·Safeguarding of SMEs working in niche markets.

This option promotes innovation and medium-term cost reduction for more efficient household refrigeration appliances.

8.2.REFIT (simplification and improved efficiency)

This section will describe how the preferred option is expected to improve the efficiency of the existing measures.

The LLCC option will reduce the total consumer expenditure as compared to the baseline. This consumer expenditure includes the acquisition cost and the energy cost. The acquisition cost will be higher, but the energy cost will decrease significantly as compared to the baseline. In addition, this option will improve industry’s revenues significantly.

Table 26 gives an overview of the increment in cost and as compared to the baseline.

Table 26: Increment in costs, revenue and administrative burden

9.How will actual impacts be monitored and evaluated?

The main monitoring element will be the tests carried out to verify compliance with the ecodesign and energy labelling requirements. This monitoring should be done by MS market surveillance authorities to ensure that requirements are met.

The main indicator for evaluating the impact of potential ecodesign and energy labelling regulations is the achievement of a market improvement towards household refrigerating appliances with a smaller environmental impact. An analysis of the products on the market (sales figures, performance, etc.) will determine if the shift towards more resource efficient products has happened as estimated, in particular based on the following sub-indicators, which reflect the general and specific objectives:

·Reduction of the electricity consumption and related GHG emissions of household refrigeration appliances;

·Increasing the economic savings for European consumers;

·Safeguarding the competitiveness of the European household refrigeration appliances industry and the full value chain;

·Improving the regulatory effectiveness and efficiency of the regulation;

·Compliance with energy efficiency requirements, i.e. maximum EEI for the different product categories;

·Compliance with material efficiency requirements

ospare part availability,

odisassembly of key-components,

ofood preservation;

·Compliance of those products that were potentially excluded due to loopholes.

The evaluation should therefore assess these sub-indicators.

Annex 1: Procedural information

1.Lead Directorates General (DG), Decide Planning/CWP references

DG ENER is the lead DG for the Ecodesign and Energy labelling regulation for household.

Decide number of the underlying initiative for the review of ecodesign requirements for household cold appliances is PLAN/2016/441 (inception impact assessment published on 23/01/2018 at  https://ec.europa.eu/info/law/better-regulation/initiatives/ares-2018-476272_en )

Decide number of the underlying initiative for the review of energy labelling for household cold appliances is PLAN/2016/445 (inception impact assessment published on 23/01/2018 at https://ec.europa.eu/info/law/better-regulation/initiatives/ares-2018-476308_en )

The following DGs (Directorates General) have been invited to contribute to this impact assessment: ENER (Energy), SG (Secretariat-General), GROW (Internal Market, Industry, Entrepreneurship and SMEs), ENV (Environment), CNECT (Communications Networks, Content and Technology), JUST (Justice and Consumers), ECFIN (Economic and Financial Affairs), REGIO (Regional policy), RTD (Research and Innovation), CLIMA (Climate Action), COMP (Competition), TAXUD (Taxation and Customs Union) EMPL (Employment), MOVE (Mobility and Transport), TRADE (Trade) and the JRC (Joint Research Centre) were consulted on the draft IA in March 2018.

2.Organisation and timing

The last Ecodesign Working Plan 2016-2019, adopted in November 2016, confirms that household refrigeration appliances continue to be a priority product group. Furthermore, the recent Energy Label Regulation (EU) 2017/1369 stipulated that household refrigeration appliances are one of the five priority subjects for which the Commission should adopt a new energy label regulation in accordance with the said overall regulation by 2 November 2018.

Article 19 of the Ecodesign Directive foresees a regulatory procedure with scrutiny for the adoption of implementing measures. Subject to qualified majority support in the Regulatory Committee and after scrutiny of the European Parliament and of the Council, the adoption of the measure by the Commission is planned for the end of 2018.

3.Consultation of the RSB

The Regulatory Scrutiny Board (RSB) delivered its opinion on a draft of the Impact Assessment on 7 May 2018 after the meeting on 3 May.

4.Evidence, sources and quality

For this impact assessment, the main supporting studies were as follows:

·Omnibus’ review Study 2014 68 , concluded that there was still significant energy savings potential for household refrigerating appliances. The Commission Ecodesign Consultation Forum decided in May 2014 that a more extensive preparatory review study was in order.

·Review study 2016 concluded that about 10TWh energy savings could be achieved by setting stricter ecodesign requirements. In addition, it proposed possible measures on spare parts to tackle circular economy aspects of household refrigerating appliances.

·Complementary study 2017 on the possible role of household refrigeration in reducing food waste.

·Impact Assessment Study 2018 by an external consultancy company, Van Holsteijn and Kemna (VHK) 69 .

On the basis of this preparatory work, the Commission drafted the policy options presented in this IA.

Stakeholder input received during the above review studies, the Consultation forum and the consultation on the Inception Impact Assessment for Ecodesign and Energy Label have also been taken into account.

Annex 2: Stakeholder consultation

This Annex gives a brief summary of the consultation process. Details are given of how and which stakeholders were consulted. In addition, it explains how it was ensured that all stakeholder’s opinions on the key elements relevant for the IA were gathered.

There has been extensive consultation of stakeholders during the review studies, and before and after the Consultation Forum meeting. Further external expertise was collected and analysed during this process. The results of the stakeholder consultation are further described in this section.

1.Review study and stakeholder consultations 

The Review Study 2016 started in January 2015 and was completed in February 2016. It followed the structure Methodology for Ecodesign of Energy related Products (MEErP) 70 .

The review study covered household refrigeration appliances in the current scope of those regulations, including wine storage appliances which are currently in the scope of the energy labelling regulation, but not in the scope of the ecodesign regulation. A technical, environmental and economic analysis was performed. This assessed the need of updating the requirements for these products and to assess policy options. This was done as per the review clause of the regulations, and within the framework of the Ecodesign Directive and Energy Labelling Regulation.

The review study was developed in an open process, taking into account input from relevant stakeholders including manufacturers and their associations, environmental NGOs, consumer organisations and MS representatives. To facilitate communication with stakeholders, dedicated website was set up on which the interim results and other relevant materials were published. The study website http://www.ecodesign-fridges.eu is still open for download of the study documents and stakeholder comments (status March 2018). During the study, two open consultation meetings were organised at the Commission premises in Brussels on 1 July 2015 and 14 December 2015. During these meetings, the preliminary study were discussed and validated with results interested stakeholders.  

2.Working Document and Consultation Forum 

The Commission services prepared two Working Documents with ecodesign and energy labelling requirements based on the results of the Review Study. The Working Documents were circulated to the members of the Ecodesign Consultation Forum and for information to the secretariat of the ENVI and ITRE Committees of the European Parliament. The Ecodesign Consultation Forum consists of a balanced representation of MS' representatives, industry associations and NGOs in line with Article 18 of the Ecodesign Directive. On 6 December 2017, they were discussed in the Ecodesign Consultation Forum meeting.

The Working Documents and the stakeholder comments received in writing before and after the Consultation Forum meeting were posted on the Commission’s CIRCA system. Minutes of the Consultation Forum meetings can be found in Annex 5. Around 20 written comments were received from 18 different MSs' representatives, industry associations and NGOs.

3.Results of stakeholder consultation during and after the Consultation Forum 

The comments of the main stakeholders on key features of the Commission services’ Working Document received during and after the Consultation Forum can be summarized as follows:

·Scope – All stakeholders agreed that glass door appliances should be in the scope of the regulations. Lower EEIs should be set for these appliances or a correction factor should be introduced to make sure that these appliances are not eliminated.

·EEI requirements – Most stakeholders agreed that the limits are unfeasible in the proposed time frame. Either the limits should be lowered or the measure should be postponed. Most stakeholders agreed on postponing the application.

·Circular Economy – Environmental NGOs and some MSs preferred more requirements on the circular economy aspects of the refrigerating appliances in the scope of this measure. On the beneficial metrics for optimised food storage appliances, most stakeholder were in favour, though NGOs and some MSs were not.

·Metrics - Environmental NGOs are not in favour of the use of correction factors. They should at a minimum not be used in the energy label. The other stakeholders welcomed the reduction and agreed on the current values.

·Standard – Environmental NGOs requested that the regulation would require a modification of the new global test standard to represent real life conditions even better.

·Energy label classes – APPLiA requested a revision of the energy efficiency classes to allow more products to reside in the top classes. Most stakeholders requested to make sure that the G-class was populated.

4.Open public consultation

An online public consultation (OPC) 71 took place from 12th February to 7th May 2018, with the aim to collect stakeholders' views on issues such as the expected effect of potential legislative measures on business and on energy consumption trends.

The OPC contained a common part on Ecodesign and Energy labelling, followed by product specific questions on (i) refrigerators, (ii) dishwashers, (iii) washing machines, (iii) televisions, (iv) electronic displays and (v) lighting.

1230 responses were received of which 67% were consumers and 19% businesses (of which three quarters were SMEs and one-quarter large companies). NGOs made up 6% of respondents, and 7% were "other" categories. National or local governments were under 1% of respondents, and 0.25% came from national Market Surveillance Authorities.

The countries of residence of the participants were predominantly the UK (41%) and Germany (26%), with a second group of Austria, Belgium, France, the Netherlands and Spain comprising together some 17%. Nine other Member States comprised another 9.5% of replies, but residents in 12 EU Member States gave either zero or a negligible number of responses. Non-EU respondents comprised around 5% of replies.

It should be noted that of the 1230 respondents, 719 (58%) replied only to lighting related questions as part of a coordinated campaign related to lighting in theatres. This was considered to significantly distort the replies, and for some questions the “lighting respondents” were removed from the calculation. Furthermore, as respondents did not have to reply to all questions, a high rate of “no answer” was observed (from 5% - up to 90%), in addition to those who replied “don’t know” or “no opinion”. To reflect better the actual answers, the number of “no answers” was deducted and the remaining answers treated as 100%.

4.1.Overall results

The first part of the questionnaire asked general questions aimed at EU citizens and stakeholders with no particular specialised knowledge of ecodesign and energy labelling regulations.

When asked regarding whether their professional activities related to products subject to Ecodesign or Energy Labelling, two-thirds (67%) of business respondents replied in the positive, and one-third (33%) in the negative, with no "no answer" replies. Almost the same percentages for "yes" (63%) and "no" (37%) were given when the business entities were asked whether they or their members knew of the Ecodesign requirements for one or more of the product groups concerned by the questionnaire, although this was reduced to 50% "yes" and 50% "no" when asked about Energy Labelling.

In reply to the question: "In your opinion, does the EU energy label help you (or your members) when deciding which product to buy?" 56% of the total respondents to the OPC gave a positive answer. Of the remainder, around 22% cited "don't know or no opinion", 3% did not reply and 19% responded negatively.

Figure 11: Consumer’s views on Label – including lighting

However, looking only at the ‘lighting respondents’ (526 of the total 1230), 73% of them replied ‘No’, ‘Don't know or no opinion’, or ‘no answer’. Given that the ‘lighting respondents’ mainly focused their comments on a narrow issue related to the current exemption for theatre lighting under ecodesign, the replies of these respondents to the earlier questions cannot necessarily be considered representative. Therefore, the calculation was also done with “lighting respondents” removed. Then, 84% of the respondents to the OPC agree that the EU Energy Label helps when deciding which product to buy. Of the remainder, around 7% cited "don't know or no opinion" or did not reply and 9% responded negatively.

Figure 12: Consumer’s view on the energy label – excluding lighting

When asked where they would look to find additional technical information about a product, respondents listed the following (more than one response permitted), ranked by the options provided: manufacturer's website (82%), the booklet of instructions (50%), [the Ecodesign] product information sheet (47%), internet user fora (39%), the retailer's website (18%), and consumer organisations (10%).

Some 63% of the participants were in favour of including Ecodesign requirements on reparability and durability, and 65% of respondents considered that this information should be on Energy Labels.

Regarding the reparability of products, participants valued mostly as "very important" to "important" (in the range 62%-68%) 72 each of the following: a warranty, the availability of spare parts, and a complete manual for repair and maintenance. The delivery time of spare parts was rated as 56% "very important" to "important".

Small and Medium Enterprises (SME) Consultation [SMEs < 250 employees]

One of the aims of the OPC was to gather specific information on SMEs' roles and importance on the market, and to acquire more knowledge on how the aspects related to the environmental impacts of these six product groups were considered by SMEs.

The quali-quantitative evaluation of the effect on SMEs of potential regulatory measures for the environmental impact of all six product categories gave the following results. Approximately 10.5% or replies were from SMEs. These SMEs were involved in the following activities (most popular cited first): (i) product installation, (ii) rent/ leasing of appliances, (iii) repair, (iv) retail of appliances or spare parts, (v) final product manufacture/ assembly, (vi) sale of second-hand appliances, (vii) "other" activities, and (viii) manufacture of specific components.

In the OPC responses, SMEs reported that they were aware of the Ecodesign and EU Energy Label requirements applicable to the products they were involved in. Nevertheless, SMEs mostly declined to respond (90%) or replied in "don’t know/ no opinion" (6%) when asked about the potential impact on their businesses per se, or potential impacts on SMEs compared to larger enterprises, of the introduction of resource efficiency requirements in the revised Ecodesign and Energy Labelling regulations. Of those SMEs who gave an opinion, some 3-4% considered that the impacts could be negative, and around 1% thought that the effects would be positive.

4.2.Responses relating specifically to refrigerating appliances

Between 37 % and 39 % of the participants answered the questions on refrigerating appliances and between 20 % and 29 % of the participants answered don't know or no opinion, depending on the question.

On the question whether the wine storage and low noise appliances should be covered by the definition of a household refrigerating appliance or should be in a separate class, the majority of the stakeholders were of the opinion that wine storage appliances and low noise refrigerating appliances should be covered by the definition of a household refrigerating appliance. This trend was seen in all stakeholder groups (i.e. MSs, NGOs, industry, NGOs, citizens and others). Of all stakeholders 24 % and 39 % respectively answered yes; 14% and 5% respectively answered no. These results are not in line with the results from the other stakeholder consultations. One stakeholder commented that it was unclear whether the question was whether these products should be in the scope or whether they should be in the scope with different requirements. If most stakeholders interpreted the question in the first sense, then the results would be in line with the results from the other stakeholder consultations.

Figure 13: Stakeholder’s view on wine storage appliances

With regards to whether different types of appliances should be treated differently in the energy efficiency calculations, in general the positive results were almost equal to the negative results. This is in line with the results from other stakeholder consultations.

·For automatic versus manual defrost, 19 % of all stakeholders said yes (i.e. 11 % yes, 5 % yes for ecodesign and 3 % for energy label) and 21 % said no. When looking into the results for the different stakeholder groups, NGOs clearly are against a different treatment (55 % contra - 9 % pro), while MSs are clearly in favour (50 % pro - 25 % contra).

Figure 14: Stakeholders’ opinion on treatment of auto versus manual defrost

·For the built-in versus standalone appliances, 13 % of all stakeholders said yes (i.e. 9 % yes, 2 % yes for ecodesign and 1 % yes for energy label) and 29 % of all stakeholders said no. In the different stakeholder groups, NGOs and citizens are clearly against a different treatment (respectively 60% and 33 % contra - 7 % and 16% pro), and MSs are in favour.

Figure 15: Stakeholders’ opinion on treatment of built-in versus standalone

·For appliances with different compartments, 22 % of all stakeholders said yes (i.e. 15 % yes, 3 % yes for ecodesign and 4 % yes for energy label) and 20 % said no. The results for the different stakeholder groups show that NGOs are clear against a different treatment (49 % contra - 13 % pro), while MSs are clearly in favour (50% pro - 17% contra).

Figure 16: Stakeholders’ opinion on treatment of appliances with different compartment types

·For appliances that help prevent food waste, 19 % of all stakeholders said yes (i.e. 13 % yes, 5% % yes for ecodesign and 1 % yes for energy label) and 16% said no. NGOs were clearly against (23% contra – 7 % pro). MSs and companies are in favour (respectively 42 % and 10% pro – 17 % and 6% contra).

Figure 17: Stakeholders’ opinion on treatment of appliances with optimised food storage

With regards to whether refrigerating appliances with glass doors should be in the scope of this regulations or the future regulation for commercial refrigerating appliances 22% was of the opinion that they should be in the scope here, and 15% was of the opinion that they should be in the scope of the commercial refrigerating appliances. This trend can be seen in all the stakeholder groups. This is in line with the results from other stakeholder consultations.

Figure 18: Stakeholders’ opinion on glass door appliances

Finally, the further comments revealed that NGOs and citizens are most concerned about the circular economy aspects of the products such as the lifetime, the repair, the warranty and planned obsolescence. Companies are most concerned about the level of the energy efficiency requirements and the circular economy aspects; recycling companies ask for more circular economy requirements, while product manufacturers are more cautious and in some cases negative. One MS commented that the label should be easily understandable by consumers.

5.IA

An IA is required when the expected economic, environmental or social impacts of EU action are likely to be significant. The IA for the review of regulations (EC) No. 643/2009 and (EU) No. 1060/1020 was carried out between May 2017 and March 2018.

The data collected in the review studies, see Annex 1.4, served as a basis for the IA. Additional data and information was collected and discussed by the IA study team with industry and experts, and other stakeholders including MSs. During this process, several meetings were organised with industry and MSs experts. The additional data and information collection focused on:

·Additional market data on energy efficiency for the period 2015-2016;

·Fine-tuning of the metrics, especially for the combi-factor;

·Fine-tuning of definitions;

·Investigation of various options for wine storage appliances and minibars;

·Sensitivity analysis regarding electricity tariffs;

·Extended company information on SMEs, possible impacts.

In addition, inception impact assessments for the ‘Regulatory measure on the review of ecodesign requirements for household cold appliances - (EC) No 643/2009’ and for the ‘Regulatory measure on the review of energy labelling for household cold appliances - (EU) No 1060/2010’ were published on 26 January 2018 for feedback until 23 february 2018. In total 12 comments were received for the ecodesign measure and 9 for the energy labelling measure.

In general all stakeholdes are in favor of Ecodesign and Energy labelling requirements for refrigerating appliances. The submitted feedback commented amongst others on the strictness of Ecodesign requirements, the affordability of appliances, resource efficiency requirements and the use of the correction factors.

Annex 3: Who is affected and how?

This annex explains the practical implications of a potential ecodesign and energy labelling measures based on implementation of the preferred policy option, see Section 5.2.2.

1.Practical implications of the initiative

The ecodesign regulation will apply to the manufacturers, importers and authorised representatives of refrigerating appliances in the scope of the regulations.

The energy labelling regulations will apply to the suppliers and the dealers of refrigerating appliances in the scope of the regulations.

They will need with comply the ecodesign requirements summarised in Table 27.

Table 27: Summary of the Ecodesign requirements

2.Summary of costs and benefits

For the preferred option, Table 28 and Table 29 present the costs and benefits which will have been identified and assessed during the impact assessment process.

Table 28: Overview of Benefits (total for all provisions) as compared to the baseline– Preferred Option

(1) Estimates are relative to the baseline for the preferred option as a whole (i.e. the impact of individual actions/obligations of the preferred option are aggregated together); (2) Please indicate which stakeholder group is the main recipient of the benefit in the comment section;(3) For reductions in regulatory costs, please describe details as to how the saving arises (e.g. reductions in compliance costs, administrative costs, regulatory charges, enforcement costs, etc.; see section 6 of the attached guidance).

Table 29: Overview of the additional costs as compared to the baseline – Preferred option

(1) Estimates to be provided with respect to the baseline; (2) costs are provided for each identifiable action/obligation of the preferred option otherwise for all retained options when no preferred option is specified; (3) If relevant and available, please present information on costs according to the standard typology of costs (compliance costs, regulatory charges, hassle costs, administrative costs, enforcement costs, indirect costs; see section 6 of the attached guidance).

Annex 4: Analytical methods

1.General introduction

Given the long track record of energy label and ecodesign regulation of household refrigeration appliances, the data availability is good. APPLiA collects data of all models on the EU-market and has done so for many years. These data are not sales-weighted. However, given the large number of models (>13500 models), it is fairly representative of energy efficiency and number of sales. Sales data from market research institutes (e.g. Growth from Knowledge (GfK)), periodically acquired by NGOs (e.g. TopTen) and other stakeholders confirmed this.

These sales data also give an overview of representative market prices, related to energy efficiency classes, in the larger MSs. It enables the assessment of the instantaneous price increases that would follow from the review of the measures (these price increases will diminish on the long run due to a ‘learning curve’ effect set at 1% price reduction per year).

The Review Study 2016 used APPLiA-data up to 2014; for the impact analysis the datasets for 2015 and 2016 were added. The reliability of most data could be checked by various sources and ultimately the data were confirmed by stakeholder consensus in various stakeholder meetings, bilateral and plenary. Employment impacts are derived from revenue per employee, again checked against reported revenue totals for the sector and anecdotal information from annual reports of individual manufacturers.

Employment impacts are derived from revenue per employee, again checked against reported revenue totals for the sector and information from annual reports of individual manufacturers.

In this Impact Assessment, in line with the Methodology for the Ecodesign of Energy-related Products 73 (MEErP), energy prices were assessed from Eurostat data. For future projections an escalation rate of 4% was used. All prices and costs are expressed in Euro 2010, calculated with historical inflation. For investment-type considerations, a discount rate of 4% is used, in line with the Commission's recommended values (as per the Better Regulation Toolbox).

In addition, there has been a sensitivity analysis that calculates energy costs and consumer expenditure at an escalation rate of 1.5 %. In short, this means that electricity tariffs in 2030 are not EUR 0.36/kWh, but EUR 0.24/kWh (all in Euro 2010).

For primary energy conversion rates for electricity generation and distribution a Primary Energy Factor (PEF) of 2.5 is used, implying by convention a 40% efficiency over the full projection period. For GHG emissions, the emission rate (in kg CO2 eq./kWh) does vary over the projection period in line with overall EU projections as indicated in the MEErP.

The focus is on the period 2010-2030; projections till 2040 are relevant because at that time there will have been be a complete stock change.

2.Main characteristics of the model

The impact assessment uses a stock model developed by VHK first in the context of the Methodology for the Ecodesign of Energy-using Products 74 (MEEuP) and then further developed in the MEErP and the Ecodesign Impact Accounting Study 75 (EIA Study) for the Commission. It has been used successfully, i.e. to the satisfaction of stakeholders and Commission, in over 20 impact assessment studies for Ecodesign and Energy Labelling studies.

The stock model has been specifically developed and paid for by the Commission (DG GROW and DG ENER) and is thus subject to the same intellectual property provisions as other contract work for the Commission.

Over the years, as it was part of various Commission contracts it has been scrutinised by many Commission officials of various DGs as well as experts from various stakeholder groups (industry, MSs and NGOs).

The input data for the stock model have been retrieved from preparatory studies and additional stakeholder consultation. For throughput data the model follows the MEErP and latest official (e.g. Eurostat) publications.

3.Model structure

The general structure of the model follows the format and conventions as laid down in the EIA Study.

Figure 19 gives an illustration of the parameters used. The parameters with extension ‘BAU’ are used for the baseline scenario. The parameters with extension ‘ECO’ are used for one or more policy options (ECO1, ECO2, etc.).

The model is built in MS Excel, using a 1 year time step. Every parameter name corresponds to an Excel sheet. Auxiliary sheets are added for the calculations.

In the case of household refrigeration appliances, 4 scenarios are calculated (BAU, LLCC, Ambi, Lenient). The BAU scenario does not go back to the period before the first introduction of efficiency measures (1995), but picks up from the previous 2007 study and corrects for the changes in the AAPLiA database since then, up till 2016. From 2016 onwards the scenario follows the trends, taking into account a slightly diminished effectiveness of the energy label and the lack of minimum requirements that will keep the “A+” energy class (the lowest of the 3 remaining classes) alive.

The other scenarios are calculated from the most recent 2016 APPLiA-database (> 13 000 models). The cut-off at a given minimum energy efficiency index is determined and then the average energy consumption of the cut-off models versus the remaining models is calculated to find the energy saving. This is the most conservative approach, i.e. it assumes no innovation but merely an increase of models with better existing technology. It applies only until 2023 (Tier II). After that, it is assumed that the energy label classes will develop as in the past.

As regards the number of models that will be forced from the market in 2021 (Tier I) and 2024 (Tier II), the scenarios take into account that in a business-as-usual and over a period of 6 years, e.g. in the period 2010-2016, at least 50% of old models – say 9% per year - are voluntarily removed from the catalogue and replaced by new models that have a better energy label classification. Likewise, over the period 2017-2023 it is assumed that 50% of models would be renewed voluntarily.

For instance, the LLCC option sets a Tier I-limit for 2021 at an index of 125% (new metric). The limit eliminates 40 % of 2016-models, but over the 2017-April 2021 period anyway 35% would have been eliminated, so the forced removal in April 2021 is in the order of 5-10%. Taking into account that the effectiveness of the energy label over the 2017-2021 period is less than before (conservative), the scenario takes an extra safety margin and says that 20% of models will be removed.

Likewise in 2024, the LLCC scenario sets a Tier I-limit for 2021 at an index of 10% (new metric). This limit removes 83% of 2016-models. Of this, already 40% were removed in 2020, 27% will be removed over the 2020-2023 period in a business-as-usual, so 16% remains to be forcefully removed in 2023. Taking into account that the new energy label classification (A-G) will not have an immediate effect, this figure is rounded up conservatively to 18%.

This representation is in itself already more ‘dramatic’ than what will happen in real-life. However, it can also be expected that manufacturers will anticipate the new limits. In addition, there is the effect that e.g. for the first year after the implementation of the limit there will still be non-compliant models in stock that can be sold. Overall, the actual transition will be smoother than what is projected. The tables hereafter gives the details of main inputs and outputs of the model.

Figure 19: Structure of the core calculation

4.Inputs

Table 30: Calculation main scenario inputs (sales weighted average)

Changes since the Consultation Forum meeting:

·Inclusion of glass door wine storage & glass door mini bars 76 ;

·Extra resource efficiency measures for status display and lighting 77 .

5.Outputs

Table 31: Results scenario analysis