Because of the complex, cross-sectoral nature of energy efficiency policies and the need for the integration of those policies into other sectors, for instance in the field of housing, transport and industry, all relevant levels of government must ensure a strong and efficient coordination of policy measures.
Commercial energy is essential for national development. But the commercial energy policy of many nations is unsustainable for reasons such as technological constraints, short-term management, and politics. Many nations, for instance, favour using indigenous energy sources, even when this is unduly costly or brings needless environmental impact. This is because they seek to restrict trade in energy to levels that do not constrain their abilities to pursue economic goals of their own choice or reduce their abilities to pursue an independent foreign policy. Such an energy distribution pattern often makes neither economic nor environmental sense in today's interdependent world.
When considering the means to promote energy efficiency, it is understood that any decisions for action should be made within the framework of an integrated national energy strategy. It is the role of government to formulate policies and strategies that direct the energy sector towards an efficient and sustainable future. Decisions must be made with regard to the structure of the energy sector itself, including its institutions and their roles, ownership, financing, availability of fuels and technological choices. Energy sector strategies in developing countries range widely from subsidized public monopolies and parastatals to highly competitive private companies.
An energy strategy must include both supply- and demand-side options in order to ensure an energy efficient future. On the supply side developing countries should consider promoting institutional and regulatory reform and increasing the participation of private sector energy supply companies. Rehabilitation and modernization of existing plants should go hand in hand with loss reduction programmer in transmission and distribution. On the demand side, countries must establish appropriate price structures and competitive markets for consumer choices.
Paragraph 33 of the 1998 UN/ECE Arhus Declaration promotes the development of integrated national policy for energy efficiency.
The Schwerin Communique, issued by the G-8 Environmental Ministers in March 1999, recognises that sustainable development cannot be achieved without more effectively incorporating environmental concerns, such as global warming, into the global economic system. A number of major European governments and the U.S. have thus confirmed the need for consistent and widespread integration of energy and environmental issues into their national and international economic policies. The Schwerin conclusions need to be adopted by Heads of State and put into action immediately.