Energy efficiency has been referred to as a “hidden fuel”, one that extends energy supplies, increases energy security, lowers carbon emissions and generally supports sustainable economic growth. Yet it is hiding in plain sight: in 2011, investments in the energy efficiency market globally were at a similar scale to those in renewable energy or fossil-fuel power generation.

1. Maria van der Hoeven
IEA Executive Director
16 October 2013
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2. IEA fuel market reports
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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
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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
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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
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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
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15. Thank You
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