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Energy efficiency

Increasing energy efficiency is a practical, simple and cost-effective method to reduce and avoid greenhouse gas emissions and abate the negative impacts of climate change on the planet and our way of life.

What is it?

Energy efficiency is the ratio of useful energy output of a system, conversion process or activity to its energy input. The energy efficiency of an industry, building, appliance or activity can be improved through a range of practises and policies and by employing energy efficient technologies.

Energy efficiency and the built environment

The IEA estimates that buildings account for approximately 40 per cent of energy used in most countries. Building efficiencies for both residential and commercial buildings in design, construction, materials, retrofitting and operation is monitored by a mixture of government regulation and policy, industry awareness and self regulation, investment, as well as consumer awareness and demand.

Energy efficient building practices include sustainable building design and use of energy efficient products and materials, such as insulation, energy efficient appliances, lighting, solar and heat pump water heating, and ventilation and cooling. These practices and technologies significantly reduce the amount of energy needed to produce the same outcome. Industry, business and consumers are increasingly employing energy efficient practices and products to lower energy costs, consume less and produce the same or better outcome.

In Australia NABERS (the National Australian Built Environment Rating System) rates the operational energy and water performance of new and retrofit buildings throughout the country. The Green Building Council of Australia (GBCA) also offers a framework called Green Star to assess the expected environmental performance a building’s design, and rates it accordingly. The two organisations have recently signed an agreement to create a more compatible approach to building rating.

Energy efficiency opportunities in the Australian market

Australia has significant opportunities to reduce its energy use and emissions through increased energy efficient practices. According to a recent report released for the Energy Efficiency Opportunities program, Australia’s industry sector could be saving an extra 6.4 million tonnes of CO₂ emissions each year through energy efficiency measures.

Further, the Centre for International Economics estimates that energy efficiency in the building sector alone would save the Australian economy $38 billion per annum by 2050.

Market benefits from implementing and achieving the energy efficiency program are significant, and further work is required to ensure that the full extent of the economy-wide opportunity is understood, and that implementation of energy efficiency measures is facilitated.

Future prospects

The IEA estimates that 54 per cent of global carbon cuts by 2030 will be derived from energy efficiency measures, and that improved energy efficiency on a global scale could deliver fuel cost savings of over $US7 trillion ($9 trillion) between 2010 and 2030.

The potential of energy efficiency extends beyond reducing emissions and abating climate change to cost savings and growth for a promising a sector of the Australian economy. However, Australia has a lot of work to do – according to the IEA, Australian industry is amongst the least efficient in the world; its efficiencies have improved by only 0.5 per cent per annum between 1990 and 2005, while other IEA countries recorded a 1.3 per cent improvement.
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