Fraunhofer-Institut für
System- und Innovationsforschung ISI

The contribution of energy efficiency to reducing the cost of decarbonization (DecarbEE)

Burning fossil fuels for energy production is a prime source of global GHG emissions: about 25% of global GHG emissions are emitted in the process of producing electricity and heat, another 40% of emissions is released in the sectors industry, transport, and buildings. Managing the demand for energy is thus a significant lever for reducing GHG emissions. In decarbonization scenarios such as those associated with meeting the 2°C target, energy efficiency is one corner stone. Yet, in contrast to other measures such as renewable energy production, nuclear power or CCS the contribution of energy efficiency to reducing GHG emissions is more complex due to the involvement of so many sectors and the small size of the single measures. Also, cost estimates are difficult due to the complexity of the measures and the dependence on additional factors such as energy prices and energy demand developments. Further, the contribution of energy efficiency measures has even been questioned on the cause of rebound effects that may reduce the effectiveness of energy efficiency in reducing demand.

This study increases transparency on the role energy efficiency plays in GHG reduction. The analyses is based on existing estimates of energy efficiency in different countries and the associated reductions in energy use. This is coupled with information on alternative decarbonization measures to estimate the cost savings associated with energy efficiency measures. The study addresses the USA and EU as well as China, India, Brazil and Mexico as newly industrialized countries with a significant (and rising) share in global energy demand and GHG emissions. The approach taken consists of three steps:

  1. Assessment of existing energy efficiency policies and their impacts
  2. Assessment of the cost effects of energy efficiency in 2°C scenarios
  3. Projection of potential cost reductions by energy efficiency policies until 2030

The project is funded by the US-based ClimateWorks foundation and  realized jointly by Fraunhofer ISI (lead), NewClimate Institute and the greenwerk. In addition, local experts review the individual results for each focus region.

The results of this study will be presented to the public in the forefront of COP 21 in Paris in November 2015.

© 2018 Fraunhofer ISI