Comments: Energy Efficiency—Is It Time To Take It Seriously?
Authors: Boschee Pam 
Published: August 2022

The solutions are there to improve energy efficiency in all sectors. We don’t need to wait. We need action because the greenest energy is the energy we don’t use.—Kim Fausing, president and CEO, Danfoss

I don’t know any other solution like energy efficiency that can simultaneously address our economic crisis, energy crisis, and climate crisis. … efficiency is the very first fuel.—Fatih Birol, executive director of the IEA

Energy security, energy prices, and the cost of living were the focus of the International Energy Agency’s (IEA) 7th Annual Global Conference on Energy Efficiency held last month in Sønderborg, Denmark. Twenty-four governments from around the world issued a joint statement stressing the importance of energy efficiency to address the energy crisis, rising inflation, and greenhouse-gas emissions. IEA said, “It was the first event of its kind at which so many governments—including France, Germany, Indonesia, Japan, Mexico, Senegal, and the United States—have made a specific call for stronger action on energy efficiency.”

Although energy efficiency has long been mentioned as a means toward achieving Paris Agreement goals, the “more exciting” announcements such as carbon capture and storage grabbed attention. Big projects offering big solutions proposed by big corporations and governments outshone energy efficiency, which also called for personal actions. Although that may be an unpleasant truth, more attention may be turning to it.

Global energy prices are high and volatile—an unsettling mix—and are hitting hard the wallets of individuals, households, industries, and entire economies. Gasoline, other fuels, and electricity prices are high (and likely to get higher), and added to inflation, are increasing the cost of most everything else.

A threshold has been met or surpassed for what is considered “affordable,” and the critical role of demand-side actions, including energy efficiency, should gain traction.

Consider this: Doubling the current rate of improvement in energy intensity, a measure of the economy’s energy efficiency, from 2 to 4% per year over this decade could potentially avoid 95 exajoule (EJ) per year of final energy consumption—equivalent to China’s current final energy consumption. (One exajoule is equal to 1018 joules.) IEA added that with each unit of energy delivering more than it does today, final energy demand by 2030 could be 5% lower yet serve an economy 40% larger.

With an eye toward energy security, cutting 95 EJ per year by 2030 avoids 30 million BOPD, approximately triple Russia’s average 2021 production. And it avoids 650 billion m3 of natural gas, around four times the EU’s imports from Russia in 2021.Also highlighted was a shift in global efforts to provide clean and efficient cooking and hearting to all who lack it today. More than 20 EJ demand would be reduced for the traditional use of biomass such as wood and charcoal in 2030, dramatically improving the lives of billions of people. For example, household air pollution is linked to around 2.5 million premature deaths a year, with women and children most affected.

One-third of the decreased energy demand is forecast to come from the use of more technically efficient equipment ranging from air conditioners to vehicles, including the adoption of electric vehicles. Electrification provides around 20%, for example through switching to electricity for low-temperature heat in industry and replacing fossil-fuel boilers with more-efficient heat pumps. Smart (digital) controls and an increase in recycling of plastics and scrap steel account for another 30% of the decrease in demand. Changes in human behavior, our personal actions, could cut 18% or so through changing travel patterns and turning down thermostats.

Buildings, heavy industry, manufacturing, and the transport sector hold significant potential for reducing energy use. In 2020 transportation’s energy consumption totaled around 105 EJ and accounted for around 27% of total global energy-related emissions, according to IEA. Buildings accounted for 129 EJ and contributed 28%, and industrial energy consumption was 156 EJ and contributed 39% of the emissions.

Although IEA said the oil market may rebalance in the second half of this year as oil demand is tempered, OPEC+ increases supply, and strategic reserves are released, it added, “This situation might prove short-lived. OPEC+ capacity constraints set the stage for 2023, when global oil supply will struggle to keep pace with demand. While non-OPEC+ continues to power ahead, OPEC+ would have to further deflate its shrunken capacity cushion to keep the implied balance from tipping into deficit.”