Energy efficiency is a cornerstone of policies to reduce carbon emissions and fossil fuel dependence in the industrialised world. For example, the European Union (EU) has set a target of achieving 20% energy savings through improvements in energy efficiency by 2020, and 30% by 2030. Measures to achieve these EU goals include mandatory energy efficiency certificates for buildings, minimum efficiency standards and labelling for a variety of products such as boilers, household appliances, lighting and televisions, and emissions performance standards for cars.
The EU has the world's most progressive energy efficiency policy, but similar measures are now applied in many other industrialised countries, including China. On a global scale, the International Energy Agency (IEA) asserts that “energy efficiency is the key to ensuring a safe, reliable, affordable and sustainable energy system for the future”. 2 In 2011, the organisation launched its 450 scenario, which aims to limit the concentration of CO2 in the atmosphere to 450 parts per million. Improved energy efficiency accounts for 71% of projected carbon reductions in the period to 2020, and 48% in the period to 2035.
Do improvements in energy efficiency actually lead to energy savings? At first sight, the advantages of efficiency seem to be impressive. For example, the energy efficiency of a range of domestic appliances covered by the EU directives has improved significantly over the last 15 years. Between 1998 and 2012, fridges and freezers became 75% more energy efficient, washing machines 63%, laundry dryers 72%, and dishwashers 50%.
Do improvements in energy efficiency actually lead to energy savings? At first sight, the advantages of efficiency seem to be impressive.”
However, energy use in the EU-28 in 2015 was only slightly below the energy use in 2000 (1,627 Mtoe compared to 1.730 Mtoe, or million tonnes of oil equivalents). Furthermore, there are several other factors that may explain the (limited) decrease in energy use, like the 2007 economic crisis. Indeed, after decades of continuous growth, energy use in the EU decreased slightly between 2007 and 2014, only to go up again in 2015 and 2016 when economic growth returned.
On a global level, energy use keeps rising at an average rate of 2.4% per year. 3 This is double the rate of population growth, while close to half of the global population has limited or no access to modern energy sources. 5 In industrialised (OECD) countries, energy use per head of the population doubled between 1960 and 2007.
Why is it that advances in energy efficiency do not result in a reduction of energy demand? Most critics focus on so-called “rebound effects”, which have been described since the nineteenth century. 7 According to the rebound argument, improvements in energy efficiency often encourage greater use of the services which energy helps to provide. 8 For example, the advance of solid state lighting (LED), which is six times more energy efficient than old-fashioned incandescent lighting, has not led to a decrease in energy demand for lighting. Instead, it resulted in six times more light.