Global energy efficiency market ‘an invisible powerhouse’ worth at least USD 310 billion per year
IEA report sees energy efficiency finance becoming established market segment in its own right
8 October 2014 Verona, Italy
The global energy efficiency market
is worth at least USD 310 billion a year and growing, according to a new
report from the International Energy Agency that confirms the position
of energy efficiency as the world’s “first fuel”. The report also finds
that energy efficiency finance is becoming an established market
segment, with innovative new products and standards helping to overcome
risks and bringing stability and confidence to the market.
“Energy efficiency is the invisible
powerhouse in IEA countries and beyond, working behind the scenes to
improve our energy security, lower our energy bills and move us closer
to reaching our climate goals,” IEA Executive Director Maria van der
Hoeven said at the Verona Efficiency Summit as she launched the IEA’s Energy Efficiency Market Report 2014.
The annual report, now in its second
year, shows that investments in energy efficiency are helping to improve
energy productivity – the amount of energy needed to produce a unit of
GDP. Among 18 IEA countries evaluated in the report, total final energy
consumption was down 5% between 2001 and 2011 primarily as a result of
investments in energy efficiency. Cumulative avoided energy consumption
over the decade from energy efficiency in IEA countries was 1 732
million tonnes of oil equivalent – larger than the energy demand of the
United States and Germany combined in 2012.
Previous IEA analysis has shown that
energy efficiency is not just a hidden fuel but is also the “first fuel”
in the IEA’s largest economies. This year’s report shows that energy
efficiency investments over the past four decades have avoided more
energy consumption than the total final consumption of the European
Union in 2011. Efficiency investments and policies are reducing a
continent’s worth of energy demand in a time when fast-developing
economies are adding energy demand to the global energy system.
Indeed, the report reveals that huge
potential for energy efficiency exists in emerging economies outside the
OECD, with efficient vehicles and transport infrastructure a major
opportunity. The IEA estimates that efficiency can reduce up to USD 190
billion in fuel costs in transport globally by 2020 and can help
alleviate local air pollution and even address critical congestion
issues in rapidly developing urban transport systems.
According to the IEA, some 40% of the
global energy efficiency market is financed with debt and equity,
meaning that the financial market for energy efficiency is in the range
of USD 120 billion per year. The number of products and the volume of
finance have greatly expanded in recent years, with green bonds,
corporate green bonds, energy performance contracts, private
commitments, carbon and climate finance, and multilateral development
banks and bilateral banks all offering expanded sources of finance for
energy efficiency improvements. Bilateral and multilateral lending alone
amounted to more than USD 22 billion in 2012.
“Energy efficiency is moving from a
niche interest to an established market segment with increasing interest
from institutional lenders and investors,” said the IEA Executive
Director. “As energy efficiency is essential to meeting our climate
goals while supporting economic growth, the increasing use of finance is
a welcome development. To fully expand this market, initiatives to
continue to reduce barriers will need to strengthen.”
Energy efficiency represents the most
important plank in efforts to decarbonise the global energy system and
achieve the world’s climate objectives: in the IEA scenario consistent
with limiting the long-term increase in global temperatures to no more
than 2 degrees Celsius, the biggest share of emissions reductions – 40% –
comes from energy efficiency.
Energy Efficiency Market Report 2014 is on sale at the IEA bookshop. Accredited journalists who would like more information or who wish to receive a complimentary copy should contact ieapressoffice@iea.org.
Download the following resources:
- Executive Summary
- Executive Director Maria van der Hoeven's speech at the launch
- The slides that accompanied the launch
- Energy Efficiency Market Report 2014 factsheet.
The International Energy Agency (IEA) is an autonomous organisation which works to ensure reliable, affordable and clean energy for its 29 member countries and beyond. Founded in response to the 1973/4 oil crisis, the IEA’s initial role was to help countries co-ordinate a collective response to major disruptions in oil supply through the release of emergency oil stocks to the markets. While this continues to be a key aspect of its work, the IEA has evolved and expanded. It is at the heart of global dialogue on energy, providing reliable and unbiased research, statistics, analysis and recommendations.
Photo: © GraphicObsession
http://www.iea.org/newsroomandevents/pressreleases/2014/october/global-energy-efficiency-market-an-invisible-powerhouse-at-least-usd-310byr.html
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