government action to accelerate adoption of ee, ipeec

ExCo 05 // 20-22 September 2011

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Market Penetration of Energy Efficient

Technology: Role of Government Action

Amit Bando Executive Director, IPEEC


IPEEC is a High Level International Forum

Provides global leadership on energy efficiency by identifying and facilitating government implementation of policies and programs that yield high energy-efficiency gains.

Aims to promote information exchange on best practices and facilitate initiatives to improve energy efficiency.

Formally established in 2009 at the G8 summit in L'Aquila, Italy and resulting from the Heiligendamm Dialogue Process.

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ExCo 05 // 20-22 September 2011IPEEC is an autonomous entity

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The IPEEC Secretariat is located in Paris, France

Members account for over 75% of world GDP and energy use.

Italy

Russia

Japan

Republic of KoreaChina

India

Australia

United KingdomFrance

Canada

USA

Mexico

Brazil

Germany

EU

ExCo 05 // 20-22 September 2011Historical Trends in Energy Use

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0

20

40

60

80

100

120

140

160

180

1973 1980 1990 2000 2006

EJ

Actual energy use Energy savings due to efficiency improvements Energy efficiency improvements

Actual energy use

63 %

Hypothetical energy use without energy efficiency improvements

Savings

Source: IEA


Government Action can

Accelerate Progress

on EE Technology Deployment

& Market PenetrationGovernment Action Can

Provide R&D Support Promote Public Awareness Provide Policy Stability

Support markets and industry Provide predictable regime

Establish Regulations, Standards & LabelsMonitor, verify & enforce standardsUse labels - promote awareness and branding

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ExCo 05 // 20-22 September 2011Government Action: Japan’s Top

Runner Program

Energy conservation law prescribes energy efficiency standards for appliances/vehicles Standards are set higher than the best

performance value of each product currently on sale in the market

Standard setting takes into account technological development 21 products are included 6


Government Action: Japan’s

Top Runner Program

(continued)Example: passenger vehicle standards were set in

1999 Target: By 2010, fuel economy improvement

would be 22.8% Fuel economy of passenger vehicles improved

by 22.8% during 1999-2005Example: air conditioners saw EE improvement of

67.4% between 1999-2004 Companies utilized technologies that they may

otherwise have waited to commercialize Improved consumer and retailer awareness

– using labels, etc. - accelerated pace of market penetration

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Government Action: USA’s

Refrigerator Standards,

Labels & Incentives Program

Between 1945 and 2010, the average refrigerator volume has increased from 8 cubic ft. to 21 cubic ft.

Government action on standards, labels and incentives led to sustained EE improvement During 1945-1978 the annual energy used by a

typical refrigerator quadrupled In 1978, refrigerator standards were introduced in

California – other states followed Since 1978, the annual energy used by a typical

refrigerator has declined steadily - reached 1945 levels in 2010 This has not interrupted the long-term decline in real

purchase price – declined from $1,000 to $600 (2009$) 8


Government Action: USA’s

Refrigerator Standards,

Labels & Incentives Program

(cont.)

Government Action on Standards, Labels and Incentives has accelerated the decline in life cycle costs (LCC) of refrigerators During 1945-1978, refrigerator LCC remained

steady at $5,000 (2009$) During 1978-2010, refrigerator LCC declined

steadily to $1,000 ((2009$)

Government Action has led to savings of about $20 billion/year in 2010 and $300 billion cumulative since 1978

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ExCo 05 // 20-22 September 2011Government Action Complements Stages

of Market Maturity

Demonstration & Sample Distribution Creating Awareness & Testing Potential

Early Adopters and Niches Positive Potential

Rational Economic Purchase Market Pull

Technology and Market Evolution Feedback

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Effective Government Action

Recognizes

the Stage of Market Maturity

A “policy package” constitutes effective action

In Japan, government action enhanced market pull by using specific (positive) regulation to provide proof of value and positive profits

In the US, progress on regulation from specific (positive) to general (neutral) has been accompanied by movement on market maturity from early adopters to market evolution

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Use questionnair

e, surveys and focus groups to inventory task group

resources to be adapted for Event

Finance

Utilities

Industry

Indicators

Sustainable Cities

Appliances Determine country &

sector needsDefine format,

activities and contents of workshop, via inputs

from stakeholders

Establish links to other

relevant initiatives & resources

Event

IPEEC Task force

IPEEC’s Capacity Building & Technical Assistance Platform

ExCo 05 // 20-22 September 2011IPEEC’s Policy Assistance Network

Strengthen EE policy design and implementation through action plans developed during capacity building events.

Undertake specific research & studies that codify useful program experience.

Support intra & inter regional cooperation through peer learning & dialogue.

Promote regional knowledge management hubs that leverage existing regional & IPEEC resources. 13


Thank you

For more information, contact the IPEEC Secretariat:

Amit Bando: [email protected]

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mailto:[email protected]