Key Factors for Successful Implementation of Energy Efficiency Policy Instruments: A Theoretical Study and the Case of Latvia

The success of energy efficiency policy depends on a number of factors, however, simultaneous application of more than just one policy instrument, coordination of multiple different policy instruments and a correct sequence of application of policy instruments are identified in research as three key factors related directly to policy making. Energy efficiency policy instruments are about the most appropriate ways of overcoming barriers to energy efficiency. The study adopts a policy analysis approach from social sciences to illustrate the relevance of a correct policy-making process in making energy efficiency policy effective. Analysis of interaction between the modules of decision-making matrix looks at the genesis of the faulty choice of energy efficiency policies. Studies of energy efficiency policy instruments indicate that implementation of a single separate policy instrument will most likely fail to achieve the expected results of overcoming barriers to energy efficiency and simultaneous implementation or combination of several policy instruments is preferable. If more than just one separate policy instrument aiming at improving energy efficiency is employed, then coordination in between two or more policy instruments as well as correct sequence of implementation of policy instruments is essential for achieving success. Lack of or insufficient attention to a full cycle of policy analysis leads to absence of one or more of the three key factors. Decision-making about energy efficiency policy instruments becomes faulty and is based on or influenced by ad hoc decisions and random circumstances, like, for example, availability or unavailability of EU financing. Such an approach contributes to maintaining or amplifying existing or creating new barriers to energy efficiency and leads to a new cycle of faulty decisions unless a proper process of policy analysis is applied in preparing and making decisions.