Energy Efficiency Simply Makes Sense

What simple tool offers the entire world an extended energy supply, increased energy security, lower carbon emissions, cleaner air and extra time to mitigate climate change? Energy efficiency. What's more, higher efficiency can avoid infrastructure investment, cut energy bills, improve health, increase competitiveness and enhance consumer welfare -- all while more than paying for itself.

Maria van der Hoeven

The challenge is getting governments, industry and citizens to take the first steps towards making these savings in energy and money.

The International Energy Agency (IEA) has long spearheaded a global move toward improved energy efficiency policy and technology in buildings, appliances, transport and industry, as well as end-use applications such as lighting. That's because the core of our mandate is energy security -- the uninterrupted availability of energy at an affordable price. Greater efficiency is a principal way to strengthen that security: it reduces reliance on energy supply, especially imports, for economic growth; mitigates threats to energy security from climate change; and lessens the global economy's exposure to disruptions in fossil fuel supply.

In short, energy efficiency makes sense.

In 2006, the IEA presented to the Group of Eight leading industrialized nations its 25 energy efficiency recommendations, which identify best practice and policy approaches to realize the full potential of energy efficiency for our member countries. Every two years, the Agency reports on the gains made by member countries, and today we are working with a growing number of international organizations, including the European Bank for Reconstruction and Development, the Asian Development Bank and the German sustainable development cooperation services provider GIZ.

The opportunities of this "invisible fuel" are many and rich. More than half of the potential savings in industry and a whopping 80 percent of opportunities in the buildings sector worldwide remain untouched. The 25 recommendations, if adopted fully by all 28 IEA members, would save $1 trillion in annual energy costs as well as deliver incalculable security benefits in terms of energy supply and environmental protection.

Achieving even a small fraction of those gains does not require new technological breakthroughs or ruinous capital outlays: the know-how exists, and the investments generate positive returns in fuel savings and increased economic growth. What is required is foresight, patience, changed habits and the removal of the barriers to implementation of measures that are economically viable. For instance, as the World Energy Outlook 2012 demonstrates, investing less than $12 trillion in more energy-efficient technologies would not only quickly pay for itself through reduced energy costs, it would also increase cumulative economic output to 2035 by $18 trillion worldwide.

While current efforts come nowhere close to realizing the full benefits that efficiency offers, some countries are taking big steps forward. Members of the European Union have pledged to cut energy demand by 20 percent by 2020, while Japan plans to trim its electricity consumption 10 percent by 2030. China is committed to reducing the amount of energy needed for each unit of gross domestic product by 16 percent in the next two years. The United States has leaped to the forefront in transportation efficiency standards with new fuel economy rules that could more than double vehicle fuel consumption.

Such transitions entail challenges for policy, and experience shows that government and the private sector must work together to achieve the sustainability goals that societies demand, learning what works and what does not, and following the right path to optimal deployment of technology. Looking forward, energy efficiency will play a vital role in the transition to the secure and sustainable energy future that we all seek. The most secure energy is the barrel or megawatt we never have to use. More

Maria van der Hoeven is the Executive Director of the International Energy Agency, an autonomous organization which works to ensure reliable, affordable and clean energy for its 28 member countries and beyond. This commentary appeared first this month inIEA Energy, the Agency's journal.