Energy efficiency from hidden fuel to world’s first fuel?
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The document discusses the significant untapped potential for improving energy efficiency, estimating that two-thirds of economic potential remains unrealized by 2035. It highlights the role of investment in energy efficiency, which, while substantial, still falls short of fossil fuel subsidies and emphasizes the importance of regulations and technology in stimulating the market. Additionally, it forecasts growth in energy efficiency markets driven by private investment and government policies, indicating a vast opportunity for reducing energy consumption globally.
Energy efficiency from hidden fuel to world’s first fuel?
- 1. Maria van der Hoeven IEA Executive Director 16 October 2013 © OECD/IEA 2013 © OECD/IEA 2013 – Photo credit: © thermalcities.com
- 3. Energy efficiency: a huge opportunity going unrealised going unrealised Energy efficiency potential used by sector in the WEO 2012 New Policies Scenario 100% Unrealised energy efficiency potential 80% Realised R li d energy efficiency potential 60% 40% 20% Industry Transport Power generation Buildings Two‐thirds of the economic potential to improve energy efficiency Two thirds of the economic potential to improve energy efficiency remains untapped in the period to 2035 © OECD/IEA 2013
- 4. USD300Bn global EE market in 2011 Comparable to RE and fossil power generation investments BUT, investments in energy efficiency are still less than two‐thirds USD billion b of the level of fossil fuel subsidies 700 600 500 EE stands alongside supply resources 400 300 Estimated range of USD 147 to 300 billion 200 100 0 © OECD/IEA 2013 Upstream oil Coal, oil and Renewable Energy and gas * gas electricity electricity efficiency generation *** generation ** Renewable energy subsidies * Fossil fuel subsidies *
- 5. IEA’s first fuel? EJ • Between 1974 and 2010, energy efficiency was the largest energy resource Cumulative avoided energy consumption due to energy efficiency in these IEA countries amounted to over 1 350 EJ (32 billion toe) 180 160 140 Hypothetical energy use had there been no energy efficiency improvements 120 4000 3500 Avoided energy equal to 65% of 2010 TFC 3000 100 2500 80 2000 60 1500 40 20 1000 Total final Consumption (TFC) 500 0 0 Coal C l Electricity TFC © OECD/IEA 2013 Mtoe • Oil Other Gas G Avoided energy use Long‐term improvements in energy efficiency in 11 IEA countries
- 6. In 2010 energy efficiency was the largest resource Energy efficiency contributed 63 exajoules (EJ) (1400 Mtoe) of avoided energy use in 2010 70 1600 60 1400 50 Mtoe EJ larger than the supply of oil (43 EJ), electricity or natural gas (22 EJ each) 1200 1000 40 800 30 600 20 400 10 200 0 0 Oil © OECD/IEA 2013 Electricity Gas Coal Other Avoided energy use Contribution of energy efficiency compared to other energy resources consumed in 2010 in 11 IEA countries
- 7. Energy efficiency has been the key factor g gy g restraining energy growth Final energy use increased by 0.5%/year between 1990 and 2010 Efficiency effect is larger than the effect of structural changes in Avera annual cha age ange restraining energy growth 3% 2% 1% 0% 1% -1% -2% 1990-2000 TFC © OECD/IEA 2013 2000-10 Activity effect Structure effect 1990-2010 Efficiency effect Changes in TFC, decomposed into structure, activity and efficiency effects for 15 IEA countries
- 8. For 4 out of 15 countries energy efficiency was the dominant factor reducing energy intensity g gy y Overall, just over half (54%) of the average annual reduction in Ave erage annual change l intensity was due to improved efficiency. 46% of the reduction was due to changes in economic structure. 0.0% -0.5% -1.0% -1.5% -2.0% -2.5% -3.0% Efficiency effect © OECD/IEA 2013 Structure effect Changes in aggregate intensities of 15 IEA countries, decomposed into structure and efficiency effects, 1990‐2010
- 9. Country case studies Markets have distinctive characteristics related to country‐specific socio‐economic conditions and resource endowments. Information provision and regulation have played a leading role in stimulating the energy efficiency market standards and labelling providing access to energy assessments and financing energy efficiency obligations placed on energy suppliers Utility and energy service company (ESCO) schemes have also driven growth, especially among large energy users. © OECD/IEA 2013
- 10. Technology focus: the digital era is defining pp future appliance EE markets USD millio ons Appliances are increasingly becoming network‐connected 30,000 26,149 26 149 10% of all f ll products will be ‘smart’ within 6 years 25,000 20,000 15,000 15 000 19,942 14,597 9,773 10,000 6,266 3,772 5,000 40 509 984 2,150 0 Smart appliance global market value Network‐connectivity and information communication technology can enable energy efficiency BUT they are also rapidly driving up energy demand Network standby could be 550TWh/yr if we don’t act k db ld b h/ if d ’ Standards (Energy Star, Top Runner) are key © OECD/IEA 2013
- 11. Japan: a Top Runner in Energy Efficiency Additional cost * (JPY billion) Direct benefit ** (JPY billion) 2005 3.4 38.1 2004 19.0 80.7 2010 41.5 107.6 Video tape recorder 2003 3.5 8.8 Air conditioner 2004 29.1 63.7 2008 2.1 2.4 2015 60.7 60 7 65.4 65 4 Warming toilet seat 2006 5.5 6.0 Television 2003 28.1 23.9 Personal computer 2005 48.0 17.9 Microwave 2008 5.1 1.5 Products Target year Lighting Refrigerator Gasoline vehicle (1 regulation) st Electric rice-cooker Gaso e e c e (2 Gasoline vehicle ( regulation) Totals nd - 246.0 416.0 Avoided energy demand 14 040 GWh (1.2 Mtoe) 29 749 GWh (2.6 Mtoe) 7 654 ML (6.6 (6 6 Mtoe) 3 241 GWh (0.28 Mtoe) 23 483 GWh (2 Mtoe) 888 GWh (0.08 Mtoe) 4 436 ML 36 (3.9 Mtoe) 2 210 GWh (0.19 Mtoe) 8 819 GWh (0.76 Mtoe) 6 611 GWh (0.57 Mtoe) 588 GWh (0.05 Mtoe) - Expected to deliver USD 3 bn in consumer benefits for lighting, vehicles and appliances vehicles and appliances Broaden scope to cover three‐phase induction motors, LEDs, heat pumps and printers in 2015. What is the energy efficiency spillover to international markets What is the energy efficiency spillover to international markets from Top Runner’s stimulation of efficient technologies? © OECD/IEA 2013
- 12. Korea: accelerating high‐efficiency appliances Korean ESCOs reached USD 330 million in 2011, an increase of 63% from 0 0. SCO s avoided .3 increase of 63% from 2010. ESCO’s avoided 1.3 Mtoe in in 2011. The total number of high‐efficiency products is increasing very fast in Korea. i i f i K Fuel‐efficient vehicles are accelerating rapidly in Korea from 30% to 100% compliance with 17 from 30% to 100% compliance with 17 km/l by 2015. by 2015. Thou usand units 500 450 400 350 300 250 200 150 100 50 0 2007 Level 5 © OECD/IEA 2013 2008 Level 4 2009 Level 3 2010 Level 2 2011 Level 1
- 13. Prospects – looking forward Energy efficiency markets are expected to grow in the medium term: medium term: Significant growth expected in private investment enabled by government policy rather than direct public investment. End‐use energy price is also a key driver, but analysis is limited by data availability and relatively greater uncertainties in projecting future pricing trends. i i d © OECD/IEA 2013
- 14. A big market with bigger potential USD 300 billion market Already delivers substantial reduction Recent growth driven by policy and high energy prices Bright national policy prospects Significant impact on the global economy Huge growth potential © OECD/IEA 2013
- 15. Thank You © OECD/IEA 2013 © OECD/IEA 2013 – Photo credit: © thermalcities.com