“Energy efficiency is already an industry in itself.”
Energy efficiency is a key principle of the UN Sustainable Development Goals and an essential part of the fight against climate change. It can path the way to clean and affordable energy and can help make our cities, buildings and economies more sustainable. Outstanding examples of how energy efficiency can help reach these goals exist all around the globe.
Wanted: political will to fight climate change
“It is still possible, with the political will and a wide array of technological measures, to limit the increase in global mean temperature to two degrees Celsius above pre-industrial levels. This requires urgent collective action,” according to the United Nation Development Program website. Said action is missing today, even though industrialised countries have tried a broad spectrum of these technological measures.
A recent study by several NGOs shows that Germany doesn’t have a sufficient climate policy framework. The Climate Change Performance Index ranks Germany 27 out of 60 countries and especially finds fault with energy consumption and climate policies. This contrasts with the government’s coalition agreement, which proclaims that Germany should become the “most energy-efficient economy in the world”.
Germany is not the only country that lacks political will. The 2018 Energy Efficiency report by the International Energy Agency shows that, even though energy efficiency policies helped to prevent 12% more energy use worldwide between 2000 and 2017, more action is needed to meet the goals of the Paris Agreement.
Efficiency boost for energy production, buildings and industry
The UN Sustainable Development Goal 7 (or SDG7) is as much about energy efficiency as it is about the access to affordable and clean energy and the increasing share of renewable energy. It aims to “ensure access to affordable, reliable, sustainable and modern energy for all” and international collaboration as well as the exchange of best practices are essential in that matter and will lead to more effective policies.
According to the United Nations Development Programme, efficient energy standards could reduce building and industry electricity consumption by 14% by 2030. The energy efficiency labels of the European Union are a great example of how such standards can help to cut energy consumption. By covering home appliances, they help consumers make better-informed purchasing decisions and save money in the long term.
Cities and buildings we live and work in are a central position in increasing energy efficiency. SDG11 states that we should “make cities and human settlements inclusive, safe, resilient, and sustainable.” Cities like Copenhagen have already set ambitious targets towards carbon neutrality. One way they intend to do so is by renovating old buildings and making them more energy efficient. This comes as no surprise, as Denmark is the global frontrunner in energy productivity. France’s Réglementation Thermique also sets an interesting path towards a carbon-neutral building sector.
While the planet benefits from these measures, they also contribute to fighting energy poverty and promoting healthy living. People who live in poverty tend to live in old and inefficient buildings and therefore pay the higher energy bills. The Affordable Warmth Government Grants in the United Kingdom aim to help them overcome energy poverty.
When it comes to energy efficiency, the industry sector is often described as a “hot potato”. While process emissions — probably the toughest nut to crack in the whole sector — are successfully addressed in Germany, the Klimapfade für Deutschland study points out that there are still huge energy efficiency potentials with negative mitigation costs.
Economic growth versus energy efficiency
Energy efficiency is already an industry in itself. In Germany, the sector employs more than 600,000 people. That’s more than ever worked in the hard coal industry, even at the height of German coal production in the 1950s. Energy-intensive industries profit from exceptions from the German Renewable Energy Sources Act. To keep those benefits, they must establish an energy management system certified by the International Organization for Standardization (ISO). This is what contributed to making the German industry a worldwide trailblazer in this area.
Many countries have already managed to dissociate energy consumption from economic activity. In China (see below) and Ghana, governments support industries to become more energy efficient with the aim to reduce greenhouse gas emissions but also to stay competitive.
The winning bet: China’s efforts to reduce energy intensity
An interview with Sang Jing by Anne-Sophie Garrigou
“Energy efficiency brings great benefits and opportunities for social and economic development.”
Sang Jing is the Founder and Executive Director of China Council for an Energy Efficiency Economy (CCEEE), an organisation that works collaboratively with experts in energy efficiency to initiate Energy Efficiency China, a research project designed to summarise and analyse important issues related to energy efficiency in China. The role of her organisation is to provide policymakers with technical assistance and feasible policy recommendations with the research results. We asked Sang Jing about the challenges that come with energy efficiency in China.
China is the world’s leading renewable energy producer and the country’s renewable energy sector is growing faster than its fossil fuels and nuclear power capacity. Yet, China is still the world’s largest emitter of greenhouse gases. How important is it to work towards energy efficiency in this context?
Renewable energy provides more choices for the energy supply end. Today, renewable energy only contributes to more than 10% of the total energy consumption, and at a high cost. Energy efficiency plays an inevitable role in energy use, with most of the benefits being realised as ‘avoided’ energy consumption, so it’s the most economical way to reduce energy consumption along with GHG emission.
What is the most important progress that China has made with regards to energy efficiency in the past decade?
The most important progress could be briefed into one sentence: since 2006, the upward trend in energy consumption has slowed down, and the energy intensity (which measures energy inefficiency) has dropped dramatically.
These achievements translate China’s efforts. The country set ambitious energy intensity reduction target and strict policies and has established a well-working energy management administrative and institutional system, upgraded technology for phasing out outdated production capacity and provided strong financial inputs on promoting energy efficiency.
What are the main challenges that China faces today when it comes to improving energy efficiency?
There are two main challenges in improving energy efficiency in China today. Firstly, the market-based mechanisms for energy efficiency are not well implemented and the motivation of the internal impetus of enterprises are still weak.
The second challenge is the lack of appropriate mechanisms and favourable environment to disseminate and scale-up the best practices on management practice, technology transformation, business models etc. Although this is not unusual, even outside of China.
What opportunities does achieving sustainable development bring for social and economic development in China?
Energy efficiency brings great benefits and opportunities for social and economic development. It helps create new industries and more job opportunities, gain more tax income, cut down domestic expenses on energy consumption, and increase productivity. Take China’s energy service industry for example: by 2018, the industry had nearly 6,500 companies and 730,000 employees, with its total production value reaching more than 477 billion renminbi.
Why is it so important to join forces with all stakeholders when it comes to the promotion of the latest energy efficiency-related research achievements?
Energy efficiency is identified as the ‘first fuel’. Improving energy efficiency and reducing emission reduction are linked and it calls for close collaboration and joint efforts for information sharing and exchange of best practices among all stakeholders.
However, the nature of energy efficiency itself determines that its important role is relatively undetectable, and the emphasis it gains does not yet match its significance. By far, the NGOs and research institutes from China and the world have played a very important role in highlighting the significance of energy efficiency and enhancing international cooperation on energy efficiency.
In this context, CCEEE works to integrate domestic and international resources and establish a platform that will inspire multilateral communications and collaboration. The platform is designed for in-depth, multidimensional exchange in policy, management, technology, financing and best practice to foster development and low-carbon economic transition.