Demand-side efficiency improvements represent nearly half of the total emissions abatement opportunity to meet the Paris climate goals, particularly in the near term — and at the same time they offer enormous economic and social benefits. Energy efficiency is at the core of our sustainable future, and yet the rate of improvement in energy intensity declined three years in a row from the peak in 2015, leaving it far below the pace needed to achieve Sustainable Development Goal (SDG) 7: Ensure access to affordable, reliable, sustainable and modern energy for all. Addressing this gap is critical for meeting climate targets, and also presents an opportunity to reap significant societal benefits from energy efficiency, including better local jobs, air quality, health and well-being.
In the wake of the Covid-19 pandemic, people are facing major disruptions to their livelihoods, are traveling less and are working from home with higher frequency. These and other disruptions impact global energy use and incomes (GDP), which are the basis for tracking energy efficiency progress using a metric of energy intensity (units of energy per unit of GDP). Initial indications for energy intensity improvements in 2020 are uncertain, as energy consumption and GDP are both likely to be significantly lower. However, the key is how we respond to this unique situation to invest in future progress. The recent IEA World Energy Investment 2020 report suggests energy efficiency investment could fall as much as 10% this year. However, governments around the world are spending trillions of dollars on recovery packages, which provides opportunities to support energy efficiency whilst investing jobs, the economy and recovering better. According to the IEA’s Sustainable Recovery Plan, 35% of new jobs could be created through energy efficiency measures, which was key to the discussions at the IEA Clean Energy Transitions Summit which gathered more than 40 ministers representing 80% of global energy consumption and underlined the importance of energy efficiency and the Recommendations of the Global Commission for Urgent Action on Energy Efficiency.