By - Jim Vess

Global energy efficiency drops to lowest rate since the start of the decade in 2018, IEA says

Energize Weekly, November 6, 2019

Primary energy intensity, a key indicator of how much energy is being used by the global economy, was down 1.2 percent in 2018 – the slowest improvement since 2010, according to the International Energy Agency (IEA).

It marked the third year in a row of declining rates, with 2017 posting a 1.7 percent improvement.

The 1.2 percent improvement in energy intensity was equal to about $1.6 trillion more GDP for the amount of energy used when compared to 2017.

Recent performance has been below the target 3 percent a year improvement in the EIA’s Efficient World Strategy. The last year close to that goal was 2015.

“The historic slowdown in energy efficiency in 2018 – the lowest rate of improvement since the start of the decade – calls for bold action by policy makers and investors,” Fatih Birol, the IEA’s executive director, said in a statement. “We can improve energy efficiency by 3 percent per year simply through the use of existing technologies and cost-effective investments. There is no excuse for inaction: ambitious policies need to be put in place to spur investment and put the necessary technologies to work on a global scale.”

Among the factors slowing the improvement in energy intensity was demand for all primary energy fuels due to an increase in production by energy-intensive industries in a several countries, including the U.S. and China.

A cold winter and warm summer in the U.S. also played a role in driving more demand for heating and cooling.

By contrast, Europe’s milder winter cut gas demand and was a major factor in the 2 percent energy intensity improvement, up from 1.4 percent in 2017, for the continent.

After three years of decline or flat growth, coal-fired generation increased in 2018 by 2.5 percent, after a 3 percent increase in 2017, as the demand for electricity also increased.

In transport, energy use continues to grow despite improvements in vehicle efficiency. Sales of new, more efficient vehicles have slowed and typical vehicle occupancy rates have fallen, the agency said. Consumers have also shown a preference for larger cars.

Residential buildings’ energy efficiency and structural changes have consistently matched or outpaced efficiency gains since 2014.

“At $240 billion, incremental efficiency investments across the buildings, transport and industry sectors were about 1.6 percent higher in 2018 than in 2017, but still well below the levels required to capture the cost-effective opportunities available,” the IEA said.

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