Energy efficiency is the one energy resource all countries possess in abundance. Strong energy efficiency policy is vital to achieving the central energy-policy goals of reducing energy bills, addressing climate change and air pollution, improving energy security, and increasing energy access.
The IEA's Energy Efficiency Market Report 2016 tracks the core indicators of efficiency progress and policy development globally. This snapshot highlights the report's key findings.
Million barrels of oil
Million tonnes of coal
Billion cubic meters natural gas
This avoided fossil fuel consumption reduced greenhouse gas emissions by 1.5 Gigatonnes, or 13% of total CO2 emissions from fuel combustion in 2015.
In 2014, efficiency gains in China avoided the burning of 350 million tonnes of coal in 2014. The annual energy savings from efficiency now equal China's renewable energy supply. Efficiency and renewables are China's twin "clean fuel" success stories.
Avoided the release of 1.2 bilion tonnes of CO2
Saved USD$230 bilion on new power plants
Drove global intensity gains
Nations cannot harness efficiency's full potential without policy. Efficiency improvements have sped up with the introduction of well-designed and implemented policies.
The potential to drive further gains is large - currently, 70% of global energy consumption is not subject to mandatory efficiency standards targets.
Energy consumption for lighting witnessed the largest jump in policy coverage; mandatory standards now cover more than 60% of energy consumption for lighting worldwide. Standards also cover more than half of the total energy consumed by light-duty vehicles, while coverage in the use of space heating and appliances has doubled.
Last year, car and truck fuel-economy standards around the world saved 2.3 milion barrels of fuel per day. That's 2.5% of global oil demand, which is roughly equal to the annual oil production of Brazil. Vehicle efficiency standards now cover 74% of car sales worldwide, but progress has varied between countries.
If best-in-class standards had been adopted around the world, oil savings would have jumped to 4.3 million barrels per day in 2015. This matches the oil production of Canada - the fourth largest oil producer in the world.
Key policies such as energy taxes and vehicle fuel economy standards are ensuring that energy efficiency continues to improve despite lower energy prices.
For many consumers the price declines have been modest, while headline crude oil price declined by 60%, thanks to taxes, energy prices in Europe and Asia typically only fell by 10 to 25%.
In the United States, where transport fuel tax rates are low, motor gasoline prices fell by almost 40%. Consumption increased by 2.7% and sales of less efficient light-duty trucks, such as sport-utility vehicles, reached a record level of more than 9.5 million vehicles in 2015.
On average, light-duty trucks have become 9% more efficient since 2010, compensating for some of the impact of the change in consumer preferences.
While the overall efficiency of the entire new vehicle fleet improved at an annual rate of 1.8% between 2005 and 2013, the rate of progress slowed to 1.0% per year between 2013 and 2015.
In 2015, investors directed USD$221 billion into incremental energy efficiency improvements - up 6% from 2014.
Efficiency investments comprised 14% of the USD$1.6 trillion spent globally on energy supply last year. Efficiency investment was two-thirds higher than investment in conventional power generation.
Global energy efficiency investment in buildings - including appliances and lighting, has been increasing, and in 2015 reached USD$118 billion.
Energy efficiency investment in large appliances, equipment, and lighting totalled USD$62 billion in 2015.
Where standards have been in place, efficiency levels have risen by at least 16% across all the major appliance categories over the last decade.
Deployment in energy efficient lighting has been particularly impressive. The drastic price declines for LED lighting led to electricity savings of 120 terawatt-hours (TWh).
This is equivalent to over half of the growth in global electricity generation in 2015.
Energy efficiency investment in transport reached USD$64 billion in 2015.
Globally, electric vehicle sales jumped sharply in 2015, up 70% from 2014. There are now more than a million EVs on the road. EVs sold in 2015 will save more than 33 million barrels of oil consumption over their lifetimes, although this is still a small portion of current oil demand (0.01%).
There is not only money to be saved through energy efficiency, there is also money to be made.
Last year, energy services companies (ESCOs) generated USD$24 billion in revenue. In the United States, ESCO revenues reached USD$6.3 billion, in the European Union they were USD$2.7 billion, in China, USD$13.3 billion. Over the past 10 years, market watchers have noted a steady increase in mergers and acquisition activity in this emerging sector.
Investors are showing strong interest in "green bonds," which often have a generous component of energy-efficiency services. Green bond issuances grew to USD$42 billion in 2015, with energy efficiency attracting the second-largest investment (20%) after renewable energy (46%).
The IEA will use its global energy perspective to support countries in implementing the right policies by learning from each other and sharing their experiences. Efficiency is the one energy resource all countries possess in abundance. The world is using only a small portion of the available supply, and this must change.