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Global energy intensity improved by 2% in 2019, but when adjusted for weather, the improvement was only 1.6%, roughly in line with 2018. This improvement is below the average between 2010 and 2017 and well below the rate of 3.6% between 2020‑40 required to achieve the IEA Sustainable Development Scenario (SDS) that shows how the world can deliver on the three main energy-related Sustainable Development Goals. Nonetheless, energy efficiency improvements in 2019 avoided an increase of 170 MT in global emissions almost equivalent to the fuel combustion-related CO2 emissions of the Ukraine 2017.

Average annual change in primary energy intensity, historically and in the IEA Sustainable Development Scenario, reflecting weather adjustment for 2018 and 2019

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The global economy required an average of 2% less energy input for every unit of GDP in 2019 than it did in 2018. This improvement in energy intensity offset around 70% of the potential increase in global energy demand that would have occurred due to economic growth. This change can be largely attributed to improvements in energy efficiency, representing almost 70% of the effects that decreased energy demand.

More temperate weather in key geographies contributed more than 20%, mostly in the form of reduced heating and cooling demand, normalising for the weather impact the improvement in the energy intensity of the global economy was 1.6% in 2019. Fuel switching also created additional energy efficiency gains of about 10%. These gains were almost entirely from changes in power generation composition in China, Europe and the United States, which displaced thermal power generation with a collection of renewables, efficient natural gas, and nuclear, and thereby reduced energy losses in the combustion and conversion processes. Changes to the structure of the global economy had a small negative effect on the rate of global energy intensity improvement in 2019.

Although energy efficiency contributed the most to energy intensity improvements in 2019, total energy savings from efficiency were 11% lower than in 2018. This decline reflects, in part, stagnation in the passing of new energy efficiency policies in recent years. In addition, slower growth in global economic activity reduced purchases of new equipment covered by energy efficiency regulations, thereby slowing the replacement of inefficient stock.

Only a little over one third of final energy use is covered by policies that mandate energy efficiency improvements, according to current estimates. Building energy codes, appliance standards, and vehicle fuel efficiency standards make up the bulk of current energy efficiency policies globally. Policy coverage has grown steadily but marginally in recent years, therefore most gains in efficiency are due to replacement of equipment covered by current policies, not new policies. Increasing the coverage and strength of codes and standards is essential to improve energy intensity fast enough to achieve the SDS. The required annual rate of over 3% is nearly double the effective rate of structual improvement in 2019.

Change in global final energy demand and causes, 2018 compared to 2019

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The major global energy users – in order, China, the United States, Europe and India – contributed the most to global energy efficiency savings in 2019, owing to their size. In the United States, Japan, India and Russia, savings from energy efficiency increased substantially in terms of gross primary energy reductions. Europe’s annual energy efficiency savings also increased from 2018 levels. In China, energy efficiency savings dropped substantially in 2019, greatly reducing the global average given China’s size.

Although many factors reduced China’s efficiency savings, a key cause was a stimulus package implemented in 2019 to stabilise economic growth and bolster competitiveness amid US-China trade tensions. Stimulus drove up energy consumption in some of the most energy-intense segments of the economy (5% growth in cement and 7% in steel). China had been improving efficiency by shifting production to the most efficient units, but under the stimulus package, some of the less efficient plants increased operation. Nonetheless, China’s energy intensity improvement rate was 2.6%, higher than the historical global average but the lowest energy intensity improvement rate since 2015.

In the United States, energy intensity improved by 2.9% in 2019, following 2018 when energy intensity worsened. This rate of improvement is higher than the average rate over the past decade and was driven largely by energy efficiency improvements. Weather was also a major factor, however, both in the 2018 deterioration and the improvements in 2019.

Average annual change in primary energy intensity in selected regions and countries, 2010-2019

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The rate of energy intensity improvement also increased in both Europe and India. In Europe, the rate of improvement rose to 3.3% in 2019 from 2.5% in 2018. In India, primary energy intensity improved by 3.8%, better than in 2018 despite lower economic growth. India’s improvement can be attributed to a slowdown in heavy industry output, lower use of energy for irrigation and a higher share of electricity generation from hydroelectricity, while intensity improvements also benefited from an increasingly comprehensive set of policies and measures.

The IEA Global Commission for Urgent Action on Energy Efficiency seeks to catalyse an acceleration of energy efficiency improvement.

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