It’s time for governments and industry to act on energy efficiency

Amid a global energy crisis, policy makers, industry executives and consumers are all talking about how to bring down the cost of energy and reinforce security of supply. Often that conversation focuses on energy source we should use.

Discussions on energy supply tend to dominate the headlines. Yet, there’s one energy source, the “first fuel” as it’s known, that rarely gets the airtime it deserves – energy efficiency. The last year has taught us all how important smarter use of energy is to our security of supply and economic resilience.

Energy efficiency is equally vital to climate action and clean energy transitions around the world. Few technologies can claim to save energy, save money, and save the planet all in one go – while creating jobs in the process. The energy efficiency industry employs tens of millions of people around the world, and there’s more to come. If we meet our energy efficiency targets – stay tuned for more on that – the industry could deliver an additional 12 million direct jobs worldwide by 2030.

There’s never been as much interest in energy efficiency as there is today. That’s why next week we’re hosting the most significant high-level conference on this subject ever: the IEA’s 8^th Annual Global Conference on Energy Efficiency. From 6-8 June, 600 people from more than 80 countries, including over 30 ministers and 50 CEOs, will gather in the historic setting of Versailles to discuss how to accelerate energy efficiency. The event is co-hosted by France’s Minister for Energy Transition Agnès Pannier-Runacher and our Executive Director Fatih Birol, and is being organised in partnership with Schneider Electric. Across three days of high-level discussions, a wide range of topics will be on the agenda including finance, innovation, digitalisation and consumer engagement. In addition, we will be launching a special report ahead of the conference setting out what needs to be done this decade to ensure the world remains on track to meet its climate and energy objectives. 

Policy will have a critical role to play in whether the world delivers on energy efficiency in the short, medium and long term. Just in the past year or so, we have seen many new policies announced. The RePowerEU plan in Europe, the Inflation Reduction Act in the United States and Japan’s Green Transformation (GX) initiative are just a few examples, while various emerging and developing economies – including India, Chile and South Africa – have enacted progressive measures to stimulate the energy efficiency agenda. Countries around the world are demonstrating a commitment to efficiency whether that’s through smart meters, high-quality appliances, well-insulated buildings or supporting industrial consumers and businesses to optimise their operations. But no country has implemented them all, and there is no silver bullet to deliver the energy savings needed to help put the world on course for net zero emissions while limiting global warming to the 1.5 °C target.  

Knowledge sharing and implementing best practices to ensure that countries take a holistic approach to energy efficiency measures is essential. That’s why the IEA’s Global Conference on Energy Efficiency will convene high-level representatives from government, industry and finance to impart lessons learned, exchange views and expertise with the aim of stimulating further action in the sector.  

In 2022, global investments in energy efficiency – such as building renovations, public transport and electric car infrastructure – reached USD 560 billion, an increase of 16% on 2021, according to the IEA’s latest energy efficiency market report. But overall efficiency investment in 2023 is expected to be largely flat, hampered by the global energy crisis and higher costs in the building sector among a number of other factors. At our conference, the IEA will be urging greater ambition and the need to prioritise energy efficiency implementation without delay.

It’s time for governments and industry to act. And what we must remember is that, unlike other fuels, energy efficiency can be used in everything, everywhere and, if we commit to it, all at once.