Energy efficiency as the world’s “first fuel” confirmed by IEA
October 21, 2014 - According to a new report from the International Energy Agency (IEA)—which confirms the position of energy efficiency as the world’s “first fuel”—the global energy efficiency market is worth at least $310-billion USD a year and growing.
By Anthony Capkun
“Energy efficiency is the invisible powerhouse in IEA countries and beyond, working behind the scenes to improve our energy security, lower our energy bills and move us closer to reaching our climate goals,” said IEA executive director Maria van der Hoeven as she launched IEA’s Energy Efficiency Market Report 2014.
The report also finds that energy efficiency finance is becoming an established market segment, with “innovative new products and standards helping to overcome risks and bringing stability and confidence to the market”.
Now in its second year, the annual report shows that investments in energy efficiency are helping to improve energy productivity (the amount of energy needed to produce a unit of GDP). Among 18 IEA countries evaluated in the report, total final energy consumption was down 5% between 2001 and 2011, primarily as a result of investments in energy efficiency. Cumulative avoided energy consumption over the decade from energy efficiency in IEA countries was 1732 million tonnes of oil equivalent, which is larger, says IEA, than the energy demand of the United States and Germany in 2012 combined.
Previous IEA analysis has shown that energy efficiency is not just a hidden fuel but is also the first fuel in IEA’s largest economies. This year’s report shows that energy efficiency investments over the past four decades have avoided more energy consumption than the total final consumption of the European Union in 2011. Efficiency investments and policies are reducing a continent’s-worth of energy demand in a time when fast-developing economies are adding energy demand to the global energy system.
“Energy efficiency is moving from a niche interest to an established market segment with increasing interest from institutional lenders and investors,” said van der Hoeven. “To fully expand this market, initiatives to continue to reduce barriers will need to strengthen.”
IEA’s stated mission is to ensure reliable, affordable and clean energy for its 29 member countries and beyond. Founded in response to the 1973/4 oil crisis, IEA’s initial role has evolved and expanded to be at the “the heart of global dialogue on energy, providing reliable and unbiased research, statistics, analysis and recommendations”.