Despite the rapid growth of renewables, emissions reductions are likely to fall short of the reductions required to avert catastrophic climate change. Improvements in energy efficiency are therefore an important strategy to close the gap. IEA’s latest update on the state of energy efficiency around the world titled, ‘Energy Efficiency 2017,’ provides mixed conclusions. While energy intensity of the global economy continued to decline, the downward trend has slowed to 1.8% compared to 2.1% in 2016. Energy efficiency made the largest contribution to offsetting the increase in GHG emissions resulting from global growth in GDP making 2017 the third consecutive year in which global GHG emissions remained stable.
On the other hand, the study finds energy efficiency policies address only 32% of global energy use, an increase of 1.4% since 2016. Most of the increase was due to the expansion of existing policies. New policies, which often support deeper reductions in energy intensity, were responsible for only 1% of the increase in coverage, a historic low as the report states. China continues to be the leader in implementation of new mandatory energy efficiency policies accounting for 70% of all new policies globally.
Other findings include: increasing use of energy management systems is driving energy efficiency in industry; energy efficiency of buildings is improving, but falls short of potential improvements enabled through innovative technologies, such as LED lighting; and fuel economy standards are driving rapid change in the motor vehicle market, including accelerating growth in the sale of electric vehicles.
Regarding the future of energy efficiency, the study states that investments grew by 9% to a total US$231 billion, dominated by investments in the building sector. In addition, two trends are expected to support improvements in energy efficiency in the next years: the rise of energy services companies that support turning energy efficiency into a tradable commodity; and the deployment of connected devices, such as smart meters, that allow for more accurate control of consumption.