‘No Excuse for Inaction’ as Global Energy Efficiency Improvements Lag

The rate at which global energy efficiency is improving has declined for the third year in a row and has hit a low point for the decade, with serious implications for consumers, businesses, and the environment, the International Energy Agency reported in an annual review released earlier this month.

Global primary energy intensity is “an important indicator of how heavily the world’s economic activity uses energy,” but improved by only 1.2% in 2018, the agency writes in a release. That’s “well below the 3% minimum that IEA analysis shows is central to achieving global climate and energy goals.”

Hitting that target would delivered economic as well as environmental benefits, the IEA adds: “If the rate had reached 3% over that period, the world could have generated a further U$$2.6 trillion of economic output—close to the size of the entire French economy—for the same amount of energy.”

IEA Executive Director Fatih Birol called for “bold action” by policy-makers and investors to pick up the pace. “We can improve energy efficiency by 3% per year simply through the use of existing technologies and cost-effective investments,” he said. “There is no excuse for inaction: ambitious policies need to be put in place to spur investment and put the necessary technologies to work on a global scale.”

In the release, the IEA says it looked into the reasons for the decline, concluding that it “results from a mixture of social and economic trends, combined with some specific factors such as extreme weather.” The review also points to policies and investments that have failed to keep pace with rising energy demand, meaning that “new ways of policy thinking that move beyond traditional approaches are required, particularly to maximize the potential efficiency gains from the rapid spread of digital technologies throughout economies and energy systems.”

The Paris-based agency holds out hope for the rise of digital technology in “transforming energy efficiency and increasing its value,” the release states. “By multiplying the interconnections among buildings, appliances, equipment, and transport systems, digitalization is providing energy efficiency gains beyond what was possible when these areas remained largely disconnected. While efficiency in these areas has always had benefits for energy systems, digitalization enables these benefits to be measured and valued more quickly and more accurately.”