Energy Efficiency Policy Toolkit 2025

Industry

Introduction

Industry accounts for 37% of final energy consumption globally. Doubling global energy intensity improvement by 2030 would require the decoupling of production from energy demand and raising the share of electricity in energy use from 23% in 2022 to 30% in 2030. An integrated policy approach combining regulation, information and incentives is the most effective way to achieve this goal.

Regulations such as minimum energy performance standards for motors increase the efficiency of industrial processes by requiring new motors to use less energy per unit of output. This also drives the innovation of more efficient technologies. The alignment of international standards can contribute to the strengthening and enforcement of regulation for industrial efficiency and accelerate global progress.

Information instruments such as industry energy efficiency networks can accelerate energy efficiency progress by facilitating knowledge exchange and the sharing of best practices. They can also work in conjunction with other government policies to boost uptake by supporting the dissemination of information on incentives and available funding to industry. Governments should consult local and national industry representatives and associations and profit from the insights of local industrial experts to determine the most effective information instrument for their country.

Incentives such as facilitating access to finance and energy efficiency obligation schemes can be effective tools for encouraging private sector stakeholders to advance energy efficiency priorities. Obligated parties often achieve savings of more than 100% of the target within the first 10 years. Incentives can also encourage companies to invest in the most efficient technologies and practices.

More information

This toolkit provides an overview of the most important elements of each policy instrument, but you can find more by exploring additional resources. ​


Policy Packages – Industry Energy Efficiency

Immediate opportunities
 Implementing better energy management practices has been shown to deliver savings up to 15% in the first 1-2 years, with little or no capital investment.

Heavy industry accounts for over two-thirds of global industrial emissions, while over 70% of short-term industrial energy efficiency savings are in light industry and SMEs.


Efficiency improvements are critical to enhancing industrial productivity over the longer term. Even today, the world’s industry can produce 20% more added value with a given amount of energy than they could two decades ago.

Regulation

  • Minimum Energy Performance Standards for key equipment, such as motors and pumps, can drive up overall industrial efficiency levels.
  • Regulation extends beyond technology to target areas such as research and development, energy auditing, mandatory consumption reporting, energy management systems, and upskilling of the workforce. Incorporating life cycle impacts into regulation helps promote material efficient choices at the design stage.
  • Regulatory instruments yield best results when rooted in a good understanding of local context and include ambitious, regularly updated, standards.
  • Regulations to ensure demand side response capabilities help provide flexibility to the grid.

Information

  • Benchmarking, indicators and other forms of detailed data allow governments to track the progress of policies and allow industries to compare their energy performance with that of their peers.
  • Digital technologies enable industries to track energy use in real time and help ensure flexible demand side response, resulting in energy optimisation and cost saving opportunities.
  • Sharing information on energy efficiency best practice through targeted information and industry networking activities helps industries raise ambition and improve energy performance.

Incentives

  • Incentives such as preferential finance, links to carbon trading, obligations and tax-based measures can motivate crucial energy efficient decisions at the process design and equipment selection stage, supporting industry’s transition to near zero emission technologies.
  • Free or subsidised energy audits, often targeted at SMEs and other sectors of strategic importance, can help rapidly increase energy efficiency.
  • Policies to foster Energy Service Companies provide industry with access to significant external energy expertise and attractive structured financial packages.
  • Incentives for the reuse and recycling of materials reduce the need for higher-emission primary materials production.


Related Case Studies

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