IEA EE Chart

Energy efficiency has saved more energy than is used
by the EU, China or the US according to a new
from the International Energy Agency (IEA). It is an
“invisible powerhouse” for the global economy, improving energy
security, reducing bills and making it easier to avoid dangerous
climate change, says IEA executive director Maria van der

The IEA was singing the praises of energy
efficiency a month ago but governments seem to be
failing to embrace its full potential
. Its
latest publication takes a more optimistic view of recent

So how much has efficiency achieved since the
turn of the century?

Continent-scale energy saving

The most arresting comparison made by the IEA
report is that efficiency efforts in the decade to 2011 saved more
energy (the large light blue bar on the chart below) than a year’s
worth of consumption in the US, China or EU (the dark blue

Those savings were achieved in 18 major
countries including France, Germany, the US and the UK. Energy
efficiency improvements like better boilers and less thirsty
engines mean those countries reduced their combined demand for
energy by five per cent in 2011 compared to 2001, the IEA says. In
2011 alone those countries saved around 1.5 times as much energy as
used by the UK in 2013 (the small blue bars on the far right, in
the chart below).

Source: IEA Energy
Efficiency Market Report 2014
and the
Digest of UK Energy Statistics 2014
; graph by Carbon

The UK comes out as the biggest saver among
those 18 nations, having reduced its energy demand by nearly 20 per
cent in the decade to 2011. The chart below shows the change in
total final energy consumption (TFC) marked with small red

This total is broken down into contributions
from growth in the economy (dark blue bars), structural changes
such as shifts in types of industrial activity (light blue) and the
impact of energy efficiency (green).

Screen Shot 2014-10-08 At 10.14.55

Source: IEA Energy
Efficiency Market Report 2014

When we looked at why
UK energy use has been falling
we found, like the IEA, that
energy efficiency has played a big part. Given this strong
performance it is perhaps surprising that the UK government
continues to oppose
targets for energy saving in 2030

On the other hand the UK’s leadership status is
thought to have
slipped more recently
as a result of policy
reforms. Its Green Deal energy efficiency scheme, for instance, is
broadly considered to have been a

Looking across all 18 nations in the chart above, the IEA

“Efficiency has more
than countered growing populations and preferences for larger
dwellings in reducing absolute energy use among the countries

Global efficiency efforts mean a worldwide
figure for energy saved since the turn of the century would be even
higher than the continent-scale avoided energy the IEA report
focuses on. The global market for energy efficiency was worth
between $310 and $360 billion in 2011 and is growing, the IEA says,
driving efficiency improvements across all sectors.

Where is all this money going? A separate
published by HSBC breaks things down by sector. This shows
that more efficient new homes, insulation and industrial energy
efficiency were the top sectors for energy efficiency investment
worldwide in 2012 (chart, below).

Sectoral EE Spend

Source: HSBC Sizing
energy efficiency investment
report; graph by Carbon

Financial markets have been developing a range
of new business models to make efficiency attractive to investors,
the IEA says. It found that barriers to investing in efficiency
were being removed “almost in real time” as it was in the process
of writing its report.

Van der Hoeven says:

“Energy efficiency is
moving from a niche interest to an established market segment with
increasing interest from institutional lenders and

There is also a substantial role for public investment in
efficiency. The IEA points to Germany’s public investment bank KfW,
which spent €16 billion on efficiency in 2013. The UK’s Green
Investment Bank spent €181 million in 2012, it says, though its
efficiency investments have been
in trouble
more recently.

The more generous German public investment is
often cited as a
of state-backed intervention in the
sector. Next year’s UK general election could see energy
rise up the political agenda
in this country

The IEA’s report says energy efficiency markets
have been growing, reaching over $300 billion per year. That’s a
good start, but much more will be required. The IEA has previously
said investment needs
to reach $900 billion a year
in 2035 if we are to
avoid dangerous climate change.