LITTLETON: A global energy market shock that has sent electricity costs soaring is causing a lot of pain, from rising utility bills to factory shutdowns and government bailouts.
But the energy crisis that has plagued the economy and mining industry alike this year also presents an opportunity to boost the efficiency levels of energy systems that have slowed the rate of efficiency improvements in recent years.
Decades of relatively low and stable electricity prices have allowed many homes and businesses to ignore energy costs as they go about their daily existence, and in many cases have led to wasteful spending and delays in energy efficiency improvements.
But the combined rise in natural gas, coal and oil costs over the past year has forced every consumer to reassess the true cost of the energy they use at home, in their cars and at work – prompting a concerted effort to reduce energy use. every aspect of their lives.
The potential cumulative impact of such a broad and simultaneous energy reduction push is huge, with consequences not only for the capacity of the current international energy supply, but also for emissions from the use of fossil fuels burned to produce energy.
Together with the planned global expansion of renewable energy supply, these sustained combined cuts in overall energy demand can help achieve the goal of reversing the trend of climate-changing emissions.
REDUCTION OF ENERGY
A key energy efficiency measure developed by research and consulting firm Enerdata tracks the total amount of energy used by each country to produce one unit of Gross Domestic Product (GDP).
The so-called Energy Intensity of GDP allows different economies to be compared and ranked, and it reveals that while at the global level the energy intensity has gradually decreased over time, several countries have struggled to reduce their energy beyond a certain point as the population increases and the production sectors use energy. hundreds and thousands of businesses.
Indeed, many major, fast-growing economies including Saudi Arabia, Nigeria, Iran and Brazil have stopped energy use and increased energy consumption per unit of GDP since 2015.
Other economies with ambitions to develop industrial and manufacturing sectors – including India and Vietnam – are at risk of doing the same, as human consumption patterns and capital expenditure are adjusted to create more workers and factories.
However, many major economies have successfully reduced energy consumption while simultaneously increasing economic output, and could serve as a potential blueprint for other nations looking to adopt ambitious targets for both economic and emissions reductions.
These success stories include China, which has reduced its energy by 15 percent since 2015 while growing GDP by more than 60 percent, data from Enerdata and the World Bank show.
Even after the sharp decline in energy, China has room for further reductions before joining fully industrialized countries including Germany and Japan, which boast electricity rates roughly half that of China by 2021.
Beijing is targeting a further 13.5 percent reduction in energy consumption per unit of production over the period 2021 to 2025, which it aims to achieve by eliminating outdated smoke plants and rolling out more modern electricity and distribution systems.
China has ambitions to become a leader in clean energy technology, and it will look to export energy-saving energy in the coming decades just as households, businesses and governments look to adopt it on a larger scale.
Similar products and systems look set to emerge in Europe, the United States and elsewhere as a result of extensive investments made in the space in direct response to rising fossil fuel prices this year.
This means that consumers around the world should be given options in terms of energy efficiency as they recover from the shock of today’s energy crisis and look to make changes to their energy use in the future.