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© OECD/IEA 2015
The energy efficiency transition
Luis Munuera, PhD
International Energy Agency
© OECD/IEA 2015
Issue: Energy efficiency is critical for the
transition to a sustainable energy system
 IEA Executive Director Fatih Birol:
Mobilising
But with great importance comes great responsibility… the
potential needs to be realized
Energy efficiency is an urgent priority. To
transition to the sustainable energy system
of the future, we need to decouple
economic growth from greenhouse gas
(GHG) emissions. Energy efficiency is the
most important “arrow in the quiver” to
achieve this. For its part, the IEA is
pursuing a number of strategies to
improve energy efficiency both among its
member governments and with partner
countries.
© OECD/IEA 2015
The global challenge: Climbing down the
mountain
Sources: CDIAC and IEA
0
5000
10000
15000
20000
25000
30000
35000
40000
1900 1925 1950 1975 2000 2025 2050
MtCO2e
2DS
“Getting to the
top is optional.
Getting down is
mandatory.”
Ed Viesturs
© OECD/IEA 2015
0
10
20
30
40
50
60
2011 2020 2030 2040 2050
Nuclear 8%
Renewables
30%
End-use fuel switching 10%
CCS 13%
End-use fuel and electricity
efficiency 38%
Gt CO2
fuel switching 1%
Power generation efficiency and
What does the transition look like?
Portfolio of actions to reduce energy sector emissions
Energy Technology Perspectives 2015
© OECD/IEA 2015
0
10
20
30
40
50
60
2011 2020 2030 2040 2050
End-use fuel and electricity
efficiency 38%
Gt CO2
fuel switching 1%
Power generation efficiency and
40% of emissions savings to 2050 come from energy efficiency in IEA scenarios
Portfolio of actions to reduce energy sector emissions
What does the transition look like?
© OECD/IEA 2015
Energy efficiency savings greater than
primary renewable electricity
0
100
200
300
400
500
600
2012 2020 2030 2040 2050
EJ
Savings
Coal
Other
Hydrogen
Oil
Commercial heat
Electricity
Natural gas
Biomass and waste
Energy efficiency provides savings by 2050 in the 2DS, being
comparable to the final energy use of China and the EU combined
in 2012.
© OECD/IEA 2015
Energy Efficiency Market Report
 Change conversation from
‘soft-pathways’ to real
infrastructure and energy
policy
 Emphasize investment,
markets, and importance
of efficiency in the system
 Backward looking –real
evidence and impacts
© OECD/IEA 2015
*IEA-11: Australia, Denmark, Finland, France, Germany, Italy, Japan, Netherlands, Sweden, United Kingdom, United States
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
1973 1978 1983 1988 1993 1998 2003 2008
Mtoe
Savings
Oil
Gas
Coal
Electricity
Other
How to unlock energy efficiency potential?
Treat efficiency as energy supply
Total Final
Consumption
Hypothetical energy
use had there been
no energy efficiency
improvements
Including Energy Efficiency savings in the energy picture shows that
Energy Efficiency is the ‘First Fuel’
© OECD/IEA 2015
These savings required investment
* IEA (2014), Energy Efficiency Market Report, Paris: OECD/IEA. ** IEA (2015), Renewable Energy Market Report, Paris: OECD/IEA.
*** Frankfurt School-UNEP Center (2015), Global Trends in Renewable Energy Investment, Frankfurt: Frankfurt School of Management, UNEP and Bloomberg New Energy Finance. **** IEA (2014),
World Energy Investment Outlook, Paris: OECD/IEA.
310 270 290 950
0
50
100
150
200
250
300
350
400
Energy efficiency* Renewable power** Fossil fired power*** Upstream oil, gas
and coal****
USDBillion
Investments in various fuels
© OECD/IEA 2015
These savings required investment
* IEA (2014), Energy Efficiency Market Report, Paris: OECD/IEA. ** IEA (2015), Renewable Energy Market Report, Paris: OECD/IEA.
*** Frankfurt School-UNEP Center (2015), Global Trends in Renewable Energy Investment, Frankfurt: Frankfurt School of Management, UNEP and Bloomberg New Energy Finance. **** IEA (2014),
World Energy Investment Outlook, Paris: OECD/IEA.
310 270 290 950
0
50
100
150
200
250
300
350
400
Energy efficiency* Renewable power** Fossil fired power*** Upstream oil, gas
and coal****
USDBillion
Investments in various fuels
© OECD/IEA 2015
80%
90%
100%
110%
120%
130%
140%
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Decomposition of Total Final Consumption (TFC) in IEA countries, 1990-2014
Energy efficiency pulling down TFC
Economic growth is
pulling demand up
Total energy
consumption is
declining
Structural change is
having some impact
Energy efficiency is responsible for two thirds
of downward pressure on consumption
© OECD/IEA 2015
IEA consumers are saving hundreds of
billions of dollars each year
 IEA countries saved USD 550 billion in 2014 as a result of energy
efficiency investments since 1990
0
100
200
300
400
500
600
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
USDbillion(2014)
Cumulative
savings
= USD 5.7
trillion
Avoided expenditure in IEA countries from energy efficiency investments made since 1990
Annual savings are greater than the EU’s fuel import bill

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V-ELEC 05 The energy efficiency transition

  • 1. © OECD/IEA 2015 The energy efficiency transition Luis Munuera, PhD International Energy Agency
  • 2. © OECD/IEA 2015 Issue: Energy efficiency is critical for the transition to a sustainable energy system  IEA Executive Director Fatih Birol: Mobilising But with great importance comes great responsibility… the potential needs to be realized Energy efficiency is an urgent priority. To transition to the sustainable energy system of the future, we need to decouple economic growth from greenhouse gas (GHG) emissions. Energy efficiency is the most important “arrow in the quiver” to achieve this. For its part, the IEA is pursuing a number of strategies to improve energy efficiency both among its member governments and with partner countries.
  • 3. © OECD/IEA 2015 The global challenge: Climbing down the mountain Sources: CDIAC and IEA 0 5000 10000 15000 20000 25000 30000 35000 40000 1900 1925 1950 1975 2000 2025 2050 MtCO2e 2DS “Getting to the top is optional. Getting down is mandatory.” Ed Viesturs
  • 4. © OECD/IEA 2015 0 10 20 30 40 50 60 2011 2020 2030 2040 2050 Nuclear 8% Renewables 30% End-use fuel switching 10% CCS 13% End-use fuel and electricity efficiency 38% Gt CO2 fuel switching 1% Power generation efficiency and What does the transition look like? Portfolio of actions to reduce energy sector emissions Energy Technology Perspectives 2015
  • 5. © OECD/IEA 2015 0 10 20 30 40 50 60 2011 2020 2030 2040 2050 End-use fuel and electricity efficiency 38% Gt CO2 fuel switching 1% Power generation efficiency and 40% of emissions savings to 2050 come from energy efficiency in IEA scenarios Portfolio of actions to reduce energy sector emissions What does the transition look like?
  • 6. © OECD/IEA 2015 Energy efficiency savings greater than primary renewable electricity 0 100 200 300 400 500 600 2012 2020 2030 2040 2050 EJ Savings Coal Other Hydrogen Oil Commercial heat Electricity Natural gas Biomass and waste Energy efficiency provides savings by 2050 in the 2DS, being comparable to the final energy use of China and the EU combined in 2012.
  • 7. © OECD/IEA 2015 Energy Efficiency Market Report  Change conversation from ‘soft-pathways’ to real infrastructure and energy policy  Emphasize investment, markets, and importance of efficiency in the system  Backward looking –real evidence and impacts
  • 8. © OECD/IEA 2015 *IEA-11: Australia, Denmark, Finland, France, Germany, Italy, Japan, Netherlands, Sweden, United Kingdom, United States 0 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 1973 1978 1983 1988 1993 1998 2003 2008 Mtoe Savings Oil Gas Coal Electricity Other How to unlock energy efficiency potential? Treat efficiency as energy supply Total Final Consumption Hypothetical energy use had there been no energy efficiency improvements Including Energy Efficiency savings in the energy picture shows that Energy Efficiency is the ‘First Fuel’
  • 9. © OECD/IEA 2015 These savings required investment * IEA (2014), Energy Efficiency Market Report, Paris: OECD/IEA. ** IEA (2015), Renewable Energy Market Report, Paris: OECD/IEA. *** Frankfurt School-UNEP Center (2015), Global Trends in Renewable Energy Investment, Frankfurt: Frankfurt School of Management, UNEP and Bloomberg New Energy Finance. **** IEA (2014), World Energy Investment Outlook, Paris: OECD/IEA. 310 270 290 950 0 50 100 150 200 250 300 350 400 Energy efficiency* Renewable power** Fossil fired power*** Upstream oil, gas and coal**** USDBillion Investments in various fuels
  • 10. © OECD/IEA 2015 These savings required investment * IEA (2014), Energy Efficiency Market Report, Paris: OECD/IEA. ** IEA (2015), Renewable Energy Market Report, Paris: OECD/IEA. *** Frankfurt School-UNEP Center (2015), Global Trends in Renewable Energy Investment, Frankfurt: Frankfurt School of Management, UNEP and Bloomberg New Energy Finance. **** IEA (2014), World Energy Investment Outlook, Paris: OECD/IEA. 310 270 290 950 0 50 100 150 200 250 300 350 400 Energy efficiency* Renewable power** Fossil fired power*** Upstream oil, gas and coal**** USDBillion Investments in various fuels
  • 11. © OECD/IEA 2015 80% 90% 100% 110% 120% 130% 140% 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 Decomposition of Total Final Consumption (TFC) in IEA countries, 1990-2014 Energy efficiency pulling down TFC Economic growth is pulling demand up Total energy consumption is declining Structural change is having some impact Energy efficiency is responsible for two thirds of downward pressure on consumption
  • 12. © OECD/IEA 2015 IEA consumers are saving hundreds of billions of dollars each year  IEA countries saved USD 550 billion in 2014 as a result of energy efficiency investments since 1990 0 100 200 300 400 500 600 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 USDbillion(2014) Cumulative savings = USD 5.7 trillion Avoided expenditure in IEA countries from energy efficiency investments made since 1990 Annual savings are greater than the EU’s fuel import bill