Energy efficiency and reducing GHG emissions. Keisuke Sadamori Director, Energy Markets and Security Barcelona, 19 September 2016

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1 Energy efficiency and reducing GHG emissions Keisuke Sadamori Director, Energy Markets and Security Barcelona, 19 September

2 Overview 1. Energy efficiency trends in EU countries 2. How efficiency reduces GHG emissions 3. The Paris Agreement and its effect on efficiency 4. The IEA 2 Degree (2DS) and Bridge scenarios and the role of energy efficiency

3 Index 2000 = 1 1. Efficiency trends: concerted progress in the EU Efficiency levels in residential buildings improved by 25% since 2000 Lack of policy in freight sector has coincided with worsening efficiency 1,10 1,00 Change in efficiency levels by sector in Europe Freight transport 0,90 0,80 0,70 0, Commercial buildings Passenger transport Residential buildings

4 Index 2002 = 1 Buildings efficiency showing progress EU efficiency policies implemented in 2002, 2006, 2012 drawing down energy demand Building efficiency indicators in France, Germany, Italy, UK, ,2 Space heating energy per household 1,2 Natural gas consumption per floor area 1,1 1,1 1,0 1,0 0,9 0,9 0,8 0,8 0,7 0,7 0, ,

5 EJ Efficiency gains lead to large energy savings and GHG emissions In 2014, the avoided total primary energy supply generated by energy efficiency improvements since 1990 was 32 EJ (765 Mtoe) Avoided TFC and TPES in 2014 in IEA countries from efficiency investments made since 1990 Avoided TFC Avoided TPES (electricity) Avoided TPES Electricity Nuclear Renewable Natural gas Coal Oil Heat End-use efficiency leads to substantial fossil fuels energy savings

6 3. Post-COP21: Policies and investment shifting to GHG reduction potential One third of NDCs have efficiency targets/policies but a large share of GHG reductions are still unallocated Energy efficiency is the most cost-effective measure to reduce GHGs and is increasingly viewed as a no-carbon fuel GHG reduction Scenarios with high efficiency penetration are USD 2.5 trillion less costly IEA Scenarios show that INDCs will boost efficiency investment, with most early effort in the buildings sector

7 4. Efficiency is a critical action in 2DS Efficiency and renewables make up 2/3rds of GHG mitigation in 2DS Contribution of technology area to global cumulative CO 2 reductions in 2DS DS Energy efficiency 32% GtCO Renewables 32% Fuel switching 10% Nuclear 11% DS CCS 15%

8 GHG reductions from efficiency are spread across all end-use sectors In each end-use sector efficiency is the most important action for direct GHG emission reduction Contribution of technology area to global cumulative CO 2 reductions in 2DS Cumulative reductions by sector and technology Other transformation Buildings Renewables CCS Transport Fuel switching Industry Energy efficiency Power Nuclear GtCO 2

9 Efficiency is a major fuel source in 2DS Contribution of technology area to global cumulative CO 2 reductions in 2DS Cumulative CO 2 reductions GtCO Avoided electricity consumption from efficiency (top) in 2DS is larger than the generation of any one low carbon source

10 Crossing the Bridge to 2 degrees IEA developed the Bridge Scenario which peaks GHGs by 2020 and puts us on a 2 degree pathway by 2030 Energy efficiency is an even larger part of the bridge

11 Efficiency at the core of EU GHG reductions in the Bridge Energy-related GHG emissions reduction in Bridge scenario relative to INDC Scenario World Energy Outlook Climate Special Report 2015

12 Efficiency actions focused on buildings in the EU In the EU over half of the GHG reductions are in buildings World Energy Outlook Climate Special Report 2015

13 Conclusion Energy efficiency improving in the EU driven by policy These improvements are leading to significant energy and GHG savings The Paris Agreement is likely stimulate to another round of policies to boost efficiency In the EU, efficiency is the prime mover of GHG reductions in IEA scenarios