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Getting the 2 degreesThe role of energy efficiency

Tyler BryantInternational Energy Agency

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Session Objectives

Outline the importance of energy efficiency in the global energy system moving forward

Describe IEA’s strategy to advancing energy efficiency analysis and policy making

Get feedback on this strategy: Is it helping and how can we help more?

Get feedback on issues, themes, focus moving forward

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Issue: Energy efficiency is critical for the transition to a sustainable energy system

IEA Executive Director Fatih Birol:

Mobilising

But with great importance comes great responsibility… the potential needs to be realized

Energy efficiency is an urgent priority. To transition to the sustainable energy system of the future, we need to decouple economic growth from greenhouse gas (GHG) emissions. Energy efficiency is the most important “arrow in the quiver” to achieve this. For its part, the International Energy Agency (IEA) is pursuing a number of strategies to improve energy efficiency both among its member governments and with partner countries.

© OECD/IEA 2015

0

10

20

30

40

50

60

2011 2020 2030 2040 2050

Nuclear 8%

Renewables 30%

End-use fuel switching 10%

CCS 13%

End-use fuel and electricityefficiency 38%

Gt CO2

fuel switching 1%Power generation efficiency and

Some background

Portfolio of actions to reduce energy sector emissions

Energy Technology Perspectives 2015

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0

10

20

30

40

50

60

2011 2020 2030 2040 2050

End-use fuel and electricityefficiency 38%

Gt CO2

fuel switching 1%Power generation efficiency and

40% of emissions savings to 2050 come from energy efficiency in IEA scenarios

Some Background

Portfolio of actions to reduce energy sector emissions

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Energy efficiency crucial to curb final energy demand growth in the 2DS

0

100

200

300

400

500

600

2012 2020 2030 2040 2050

EJ

Savings

Coal

Other

Hydrogen

Oil

Commercial heat

Electricity

Natural gas

Biomass and waste

Energy efficiency provides savings by 2050 in the 2DS, being comparable to the final energy use of China and the EU combined

in 2012.

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Efforts in all sectors are needed

0 50 100 150 200 250 300 350

Power

Industry

Transport

Buildings

Othertransformation

GtCO2

Cumulative reductions by sector and technology

Renewables

CCS

Fuel switching

Energy efficiency

Nuclear

Similar reduction efforts are needed on the supply (power and tranformation) and the end-use side.

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Well-to-wheel GHG reductions in transport

Vehicle efficiency improvements and switching to low-carbon fuels are key to reduce the transport sector’s GHG emissions below

today’s levels.

0

4

8

12

16

2012 2020 2030 2040 2050

GtCO

2

Innovation areas

Avoid ShiftLow-carbon fuels Efficient vehicles

0

4

8

12

16

2012 2020 2030 2040 2050

Modes

2-, 3- and 4-wheelers Light-duty vehiclesHeavy-duty vehicles Rail

6DS

2DS

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Where to save energy in the buildings sector?

53 EJ can be saved in the buildings sector in 2050 in the 2DS, an amount equivalent to the energy consumption of all buildings in

the OECD today.

0 4 8 12 16

2050

2040

2030

2020

EJ

Energy Savings

Space heating

Water heating

Cooking

Lighting, cooling and appliances

Miscellaneous equipment

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Over 115 INDCs, over 140 countriesOver 85% of energy related GHG

Submitted INDCs as of early Oct cover over 85% of energy-related GHG emissions, with implications for future energy & emissions trends

Submitted INDCs (1 October)

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INDCs one step on the journey but we need to cross the bridge

“Room” for more energy efficiency stimulus to support greater climate change mitigation action

24

27

30

33

36

2015 2020 2025 2030

Gt

450 Scenario

INDC Scenario

World Energy Outlook Climate Special Report 2015

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Global energy-related GHG emissions

20

25

30

35

40

2000 2014 2020 2025 2030

Gt C

O2-

eq

Bridge Scenario

INDC ScenarioEnergy

efficiency

49%

Reducinginefficient coal

Renewablesinvestment

Upstream methanereductions

Fossil-fuelsubsidy reform

17%

15%

10%

Savings by measure, 2030

9%

Five measures – shown in a “Bridge Scenario” – achieve a peak in emissions around 2020, using only proven technologies & without harming economic growth

Peaking emissions around 2020:A Bridge Scenario to greater ambition

World Energy Outlook Climate Special Report 2015

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Where do these efficiency gains come from?

Energy-related GHG emissions reduction (CO2e) in Bridge scenario relative to INDC Scenario

World Energy Outlook Climate Special Report 2015

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Energy-related GHG emissions reduction (CO2e) in Bridge scenario relative to INDC Scenario

Where do these efficiency gains come from?

World Energy Outlook Climate Special Report 2015

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Getting to 2 degrees: Doubling the rate of improvement in energy intensity

-4,5%

-4,0%

-3,5%

-3,0%

-2,5%

-2,0%

-1,5%

-1,0%

-0,5%

0,0%

0,5%

1982-1991 1992-2001 2002-2011 2012-2020 (450 ppm) 2021-2030 (450 ppm)

Avera

ge a

nnua

l cha

nge in

energ

y int

ensity

World

OECD

Non-OECD

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Cumulative Investment in the New Policies and 450 Scenarios, 2014-2035

Spending on energy efficiency is $6 trillion higher in the 450 (2DS) scenario

10 20 30 40 50 60Trillion dollars (2012)

22 6 11450 Scenario

26 7 7New Policies Scenario

Fossil fuels Power T&D Low-carbon

14

8

Energy Efficiency

WEO 2013 Special Report

Long term investment landscape for 2 degrees

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Mobilizing investment in energy efficiency: The IEA’s strategy

Current program of work includes (but not limited to): World Energy Outlook Energy Efficiency in Emerging Economies Energy Efficiency Market Report (EEMR)Multiple Benefits of Energy efficiency Energy Technology Perspectives

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Energy Efficiency Market Report

Change conversation from ‘soft-pathways’ to real infrastructure and energy policy

Emphasize investment, markets, and importance of efficiency in the system

Backward looking –real evidence and impacts

Enable policy makers to

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EE generates multiple benefits

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Energy efficiency markets and Multiple Benefits

Bridging work streams this year in EEMR 2015: Avoided GHGs Avoided energy imports Avoided expenditure

10,0

10,5

11,0

11,5

12,0

12,5

13,0

13,5

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

GtCO

2 Emissionssavings

Emissions

IEA emissions from fossil fuel combustion and emissions savings from energy efficiency investments since 1990

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IEA consumers are saving hundreds of billions of dollars each year

IEA countries saved USD 550 billion in 2014 as a result of energy efficiency investments since 1990

Avoided expenditure in IEA countries from energy efficiency investments made since 1990

Annual savings are greater than the EU’s fuel import bill

0

100

200

300

400

500

600

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

USD

billio

n (201

4)

Cumulative savings = USD 5.7 trillion

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Driving Energy Efficiency in Emerging Economies

247

Primary Energy Demand 2035, Source: IEA World Energy Outlook 2014

465

Brazil1 559

India

967Southeast

Asia

4 145

China

178South Africa

Mexico

Ukraine

97% of energy demand growth will come from non-OECD countries by 2035.

Partners China, Brazil, India, Indonesia, Mexico, South Africa, Thailand and Ukraine already account for more than a third of global energy demand.

Brazil India

SoutheastAsia

China

South Africa

Mexico

Ukraine

Working closely with emerging economies to develop high-quality:

Energy efficiency policy and technology recommendations

Projects Modelling the potential for energy efficiency, tracking progress, implementing policies and evaluating impacts

and Capacity Building Energy Efficiency in Emerging Economies Training Week with over 100 policy makersand advisors from 36 countries

tailored to their needs and priorities.

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What’s next? Other benefits?

Dirty air prompts free public transport in ParisPublic transportation in the capital will be "gratuit" from Friday morning to Sunday night, as officials battle against a spike in "dangerously" poor air quality. Velib' rental bikes and the car-sharing Autolib' scheme are also on the house.

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What’s next? Moving to systems efficiency?

Energy intensity measures all change but often too broad a brush Decompose and isolate efficiency changes:

• E.g. Appliance and vehicle efficiency

System efficiency is measured by intensity• Pushing structural levers, economy of future, modal shifting, smart cities

Energy Intensity

Energy Efficiency

Energy ProductivityAnd

0

0.05

0.10

0.15

0.20

0.25

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

toe p

er tho

usan

d 20

05 U

SD P

PP

Non-OECDTotal

World

OECDAmericas

OECD AsiaOceania

OECDEurope

70%

80%

90%

100%

110%

120%

130%

140%

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

Activity effect

TFC

Structure effect

Efficiency effect

Unit efficiencyOperations efficiency

Systems efficiency

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Getting to 2 degrees: Consuming less energy and clean the rest

0

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100

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350

2000 2010 2020 2030 2040 2050

Inde

x 20

12 =

100

GDP

and energy

TPED

Decoupling GDP

CO2

Decarbonisation

TPED per GDP Carbon intensity

0

50

100

150

200

250

300

350

2000 2010 2020 2030 2040 2050

Rate of decoupling energy use from GDP needs to be more than doubled over the next four decades

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Questions for Discussion

What do you think of this focus?

Is the markets angle advancing policy?

What is the role of international partnerships and sharing on energy efficiency policy?

What else?