Arise, energy efficiency – the only abundant energy resource that every country has!
According to the recently published BP Statistical review of world energy 2017, carbon emissions were essentially flat in 2016, marking the third consecutive year that they’ve either remained stable or fallen.” The 1% growth in primary energy use against a global economic growth rate of 3+% is well below the 10-year average of 1.8%.
Many, even today, expect global energy demand to double by 2050. Oil and gas companies used this premise to continue growing as global markets remain fixated on everything oil with 50% of the top 10 Fortune Global 500 being energy companies.
Success is often measured by increases. Conventional thinking points towards positive progress with increasing energy use. Indeed, some have hard wired economic development correlations to energy consumption. However, the scale and effectiveness of disruptive technologies have emerged at unprecedented levels in the past 5 years and the energy industry is not an exception.
Energy efficiency is an example of using less to produce more. While China’s economy grew by 6.9% in 2015, primary energy demand increased by just 0.9%. Never the less, in terms of energy efficiency, there is considerable scope for an economic giant like China (and the US) to improve against pacesetters like the Europeans, performing at nearly double the efficiency measured in dollars per metric ton of oil-equivalent. Just imagine the enormity of the opportunity that has to offer and how much conventional energy use, hence CO2 emissions, could be avoided if the leading demonstrable energy efficiency level can be attained and sustained. The outcome is nothing less than industry game-changing but also world changing where global economy no longer catches a cold when oil/gas/energy price sneezes.
Government policy has always been recognized as key to improving energy efficiency. For example, fuel economy standards on light-duty vehicles globally reduced oil consumption equivalent to 2.5% of global supply. In Singapore, mandatory energy label for white goods in the household sector helps consumers to make informed choice on energy efficiency. Such initiatives extend to the public and industry sectors.
Energy efficiency is the only energy resource that every country has in abundance, and its effects so far reaching, there is a strong case for increasing policy intervention to accelerate the phenomenon of “less is more, and better”. Germany, for example, has a target of reducing primary energy consumption by 50% come 2050 (base year being 2008), building energy efficiency in as one of the twin pillars of its energy transition. Singapore also has an ambitious target of reducing by 30% come 2030 (base year 2005). The benefits of energy efficiency is multi-dimensional for economic development including employment and skills development. Just as the emerging solar industry in the US now employs significantly more people that the conventional coal industry does, energy services companies in China, for example, employs over 600,000 people in 2015. Singapore amended its 2014 Energy Conservation Act in April to improve its effectiveness, and initiatives coordinated by E2PO, ranging from incentives (e.g. Energy Efficiency Fund, Green Mark Incentive Scheme, Training Fund) for improvement to heftier penalties for failure and non-compliance through legislation.
The notion of “less is more, and better” is already disrupting status quo. Energy efficiency is emerging from being an under-dog resource to play at the main stage. Let’s look forward to economic growth with the win-win of lower energy use and lower carbon emissions.