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10 key recommendations to rapidly boost energy efficiency progress worldwide

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Higher ambition and faster action by governments to accelerate improvements in energy efficiency worldwide are both vital and achievable, according to 10 key recommendations published today by a group of national leaders, ministers, top business executives and prominent energy experts. The list of proposed actions will be a key part of discussions at a major IEA conference that takes place tomorrow.

With the support of the IEA, the members of the Global Commission for Urgent Action on Energy Efficiency have over the past year explored the most effective ways to achieve stronger global progress in energy efficiency, which brings major benefits such as lower energy bills, large numbers of new jobs and significant reductions in greenhouse gas emissions. Their 10 recommendations highlight the best approaches to designing and implementing policies to unlock the huge advantages that energy efficiency offers to economies and societies around the world.

The Global Commission’s work comes as many governments are increasingly focusing on plans to repair the social and economic damage caused by the Covid-19 crisis. The Commission’s recommendations focus on this new reality and highlight the strong role that energy efficiency can play in bringing about a sustainable recovery.

“At this critical time, the importance of energy efficiency has not faded. If anything, the case is stronger and more urgent than ever before,” said Prime Minister Leo Varadkar of Ireland, the Commission’s Honorary Chair, in an introduction to the recommendations. “We need transformative change. Therefore, we have developed this set of 10 recommendations that identify policies that can be implemented quickly to boost activity on energy efficiency globally.”

Established a year ago, the Global Commission is an independent body comprising 23 members from around the world spanning government, industry, research and civil society. Drawing on the IEA’s analysis showing the worrying slowdown of global efficiency progress in recent years, the Global Commission was tasked with examining how to reverse this trend through new and stronger policy action by governments across key sectors of the economy.

The work of the Global Commission complements a major IEA report released last week that outlines a Sustainable Recovery Plan designed to enable governments to simultaneously boost their economies, create millions of jobs and put global greenhouse gas emissions into structural decline. Based on an analysis conducted in collaboration with the International Monetary Fund, the new IEA report shows that energy efficiency is an essential element in achieving these results.

“The IEA sees energy efficiency as a crucial clean energy resource,” said Dr Fatih Birol, the IEA Executive Director. “It has enormous untapped potential to help put the world on a more secure and sustainable path if governments make it an integral part of their policies and programmes across key parts of the economy. This is why I invited the members of the Global Commission to come together to identify global best practices and make actionable recommendations to spur the faster progress that the world urgently needs. I thank all the Commission members for their extremely valuable contributions to this endeavour.”

The Global Commission’s recommendations will be discussed at the IEA’s Fifth Annual Global Conference on Energy Efficiency, which will take place online on 23 June. The conference will hear from 15 ministers from around the world, with a focus on policy actions that can deliver the multiple benefits of energy efficiency as governments respond to the Covid-19 crisis. High-level speakers will bring a range of perspectives from governments, companies and international organisations.

The role of energy efficiency in economic stimulus plans and clean energy transitions will be an important part of discussions at the IEA Clean Energy Transitions Summit on 9 July. The Summit, which will take place online, will bring together dozens of ministers from countries representing over 80% of global energy demand as well as energy industry CEOs, big investors and other key leaders from the public and private sectors around the world.

Actions proposed by Global Commission for Urgent Action on Energy Efficiency highlight benefits of efficiency for sustainable recovery plans and will be discussed at major IEA conference tomorrow

1. Prioritise cross-cutting energy efficiency action for its economic, social and environmental benefits

A stronger, all-of-government policy focus will enhance social and economic development, energy security and resilience, decarbonisation, and rapid job creation and economic stimulus

2. Act to unlock efficiency’s job creation potential

Energy efficiency can quickly deliver job growth and can become a long-term, sustainable employment sector

3. Create greater demand for energy efficiency solutions

Efficiency action will be most rapidly scaled up through a focus on increasing demand for efficient products and services and enabling greater levels of market activity

4. Focus on finance in the wider context of scaling up action

Mobilising finance is an essential element of efficiency action, and policies to do so will be most effective if they are part of a wide, coherent approach to driving market scale

5. Leverage digital innovation to enhance system-wide efficiency

Policymakers can take advantage of digital innovation’s potential to enable smart control, better energy management, and wider energy system optimisation

6. The public sector should lead by example

Governments should lead through investment in public sector efficiency and driving innovation and higer standards throughout its reach

7. Engage all parts of society

Implementation of efficiency action can happen at all levels of society, with cities, businesses, and local communities all playing a particularly important role in its success

8. Leverage behavioural insights for more effective policy

People are at the centre of energy efficiency action, and insights from behavioural science can help design smarter policies

9. Strengthen international collaboration

International collaboration and exchange of best practice allow countries to learn from each other and to harmonise approaches and standards where appropriate

10. Raise global energy efficiency ambition

Governments should be significantly more ambitious in both the short- and long-term when setting their efficiency targets, policies and actions

The Global Commission’s 10 Recommendations

Honorary Chair: H.E. Mr. Leo VARADKAR, Prime Minister of Ireland H.E. Dr. Amani ABOU-ZEID, Commissioner for Infrastructure and Energy, African Union Commission, Ethiopia H.E. Mr. Richard BRUTON, Minister of Communications, Climate Action and Environment, Ireland Mr. Nick BUTLER, Visiting Professor, King’s College London, United Kingdom H.E. Mr. Alfonso CUSI, Secretary, Department of Energy, Philippines Ms. Lisa DAVIS, CEO, Gas and Power, Siemens, United States Ms. Connie HEDEGAARD, Chair, KR Foundation, Denmark Mr. Michael LIEBREICH, Chairman and CEO, Liebreich Associates, United Kingdom Dr. Ajay MATHUR, Director General, The Energy and Resources Institute, India Ms. Lisa MURKOWSKI, US Senator, Chairman of the Senate Energy and Natural Resources Committee, United States (honorary member) Mr. Gil C. QUINIONES, President and CEO, New York Power Authority, United States H.E. Mr. Aziz RABBAH, Minister of Energy, Mines and Sustainable Development, Morocco H.E. Ms. Teresa RIBERA RODRIGUEZ, Deputy Prime Minister and Minister for the Ecological Transition, Spain Mr. Adam SIEMINSKI, President, King Abdullah Petroleum Studies and Research Center, Saudi Arabia H.E. Ms. María Fernanda SUÁREZ LONDOÑO, Minister of Mines and Energy, Colombia Mr. Masakazu TOYODA, Chairman and CEO, Institute of Energy Economics, Japan Mr. Jürgen TRITTIN, Member of the German Parliament, Germany H.E. Mr. Claude TURMES, Minister for Energy and Minister for Spatial Planning, Luxembourg Mr. Ben van BEURDEN, CEO, Royal Dutch Shell, the Netherlands H.E. Dr. WAN Gang, Chairman, Science and Technology Association of China H.E. Dr. Megan WOODS, Minister of Energy and Resources, New Zealand Dr. Kandeh YUMKELLA, Former UN Under-Secretary-General, CEO & Special Representative of the Secretary-General, Sustainable Energy for All, Sierra Leone H.E. Ms. Salomé ZOURABICHVILI, President of Georgia

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Greek shipowners do not care about the boycott of Russian oil

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European sanctions against Russian oil will only lead to higher prices, it will hit the pocket of the end consumer, says Nicolas A. Vernicos, the largest Greek ship owner and president of the International Chamber of Commerce. He made this statement in connection with the decision of the European Union to impose a price cap on Russian oil.

The French ‘Liberation’ published an interview with N. Vernicos under the title “Russian oil: Greek shipowners, in whose hands half of the world’s  tankers, do not care about the boycott.”

Vernicos says: “Transportation costs, which are already skyrocketing, will rise even faster, but the embargo on the transportation of Russian oil by sea will have a positive effect on shipowners, because we will become richer.”

At the same time, he warns that Greece will comply with the new conditions. The European decision on sanctions will bring a net benefit only to maritime carriers. Nicolas A. Vernicos recalls: “The Greek shipping community is the strongest in the world… Nothing can be done without it, and the Greeks will definitely find a way around the sanctions.”

And on the fact that prices will rise, Russia will also earn.

‘Liberation’ writes that in the hands of the Greeks 21% of the world’s shipping tonnage and 40% of the world’s tonnage in the transportation of oil, their trade cooperation with Russia has existed since the 19th century, and they do not intend to stop it.

The EU countries have already agreed on the issue. An agreement was reached to set the price limit at $60 per barrel. The decision came into force on 5 December.

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OPEC+ agrees to stick to its existing policy of reducing oil production

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Led by Saudi Arabia and Russia, OPEC+ agreed in early October to reduce production by 2 million barrels per day from November, – informs CNBC.

An influential alliance of oil producers on Sunday agreed to stay the course on output policy ahead of a pending ban from the European Union on Russian crude.

OPEC and non-OPEC producers, a group of  23 oil-producing nations known as OPEC+, decided to stick to its existing policy of reducing oil production by 2 million barrels per day, or about 2% of world demand, from November until the end of 2023.

The European Union is poised to ban all imports of Russian seaborne crude from Monday, while the U.S. and other members of the G-7 will impose a price cap on the oil Russia sells to countries around the world.

The Kremlin has previously warned that any attempt to impose a price cap on Russian oil will cause more harm than good.

Led by Saudi Arabia and Russia, OPEC+ agreed in early October to reduce production by 2 million barrels per day from November. It came despite calls from the U.S. for the group to pump more to lower fuel prices and help the global economy…

The looming Russian oil price “cap” has all the hallmarks of a historic debacle in the making, – notes “The Hill”.

For months, the United States and the G-7 have haggled over a complex plan to constrain the money that the Kremlin makes from some of its oil exports.

Despite Russian war against Ukraine and subsequent Western sanctions on his regime, Russia is swimming in petrol dollars. By the end of the year, the Russian Economy Ministry estimates that the country will have made a record $338 billion from its energy exports.

Together with America’s existing embargo on Russian crude, when the European Union’s oil embargo comes into full force on Dec. 5, policymakers fear that the move will constrain global petroleum supplies and push prices upward.

Assuming that EU and G-7 leaders can sort out their current price puzzle and fix Russian crude below what the international market would prefer to pay, who will pick winners and losers in the subsequent scramble for cheap Kremlin oil: Putin and his energy cronies?  

The Russian oil “cap” would not be necessary if the Biden White House had been making it easier to open the spigots of American oil from the start. The president’s pledge of “no more drilling” in America continues to undercut his economic and foreign policy against Russia.

If the Russian oil price cap fails to materialize or work as officials intend, the United States and its allies should drop the scheme, – stresses “The Hill”.

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G7 agrees oil price cap: reducing Russia’s revenues, while keeping global energy markets stable

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The international Price Cap Coalition has finalised its work on implementing an oil price cap on Russian seaborne crude oil. EU Member States in the Council have also just approved in parallel its implementation within the EU.

The cap has been set at a maximum price of 60 USD per barrel for crude oil and is adjustable in the future in order to respond to market developments. This cap will be implemented by all members of the Price Cap Coalition through their respective domestic legal processes.  

Ursula von der Leyen, President of the European Commission, said, “The G7 and all EU Member States have taken a decision that will hit Russia’s revenues even harder and reduce its ability to wage war in Ukraine. It will also help us to stabilise global energy prices, benefitting countries across the world who are currently confronted with high oil prices.”

While the EU’s ban on importing Russian seaborne crude oil and petroleum products remains fully in place, the price cap will allow European operators to transport Russian oil to third countries, provided its price remains strictly below the cap.

The price cap has been specifically designed to reduce further Russia’s revenues, while keeping global energy markets stable through continued supplies. It will therefore also help address inflation and keep energy costs stable at a time when high costs – particularly elevated fuel prices – are a great concern in the EU and across the globe.

The price cap will take effect after 5 December 2022 for crude and 5 February 2023 for refined petroleum products [the price for refined products will be finalised in due course]. It will enter into force simultaneously across all Price Cap Coalition jurisdictions. The price cap also provides for a smooth transition – it will not apply to oil purchased above the price cap, which is loaded onto vessels prior to 5 December and unloaded before 19 January 2023.

More Information

The EU’s sanctions against Russia are proving effective. They are damaging Russia’s ability to manufacture new weapons and repair existing ones, as well as hinder its transport of material.

The geopolitical, economic, and financial implications of Russia’s continued aggression are clear, as the war has disrupted global commodities markets, especially for agrifood products and energy. The EU continues to ensure that its sanctions do not impact energy and agrifood exports from Russia to third countries.

As guardian of the EU Treaties, the European Commission monitors the enforcement of EU sanctions across the EU.

The EU stands united in its solidarity with Ukraine, and will continue to support Ukraine and its people together with its international partners, including through additional political, financial, and humanitarian support.

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