UNEP: As fuel prices rise, companies look to energy efficient solutions

With fossil fuel prices reaching record highs, companies around the world are focusing on energy efficiency to save money and reduce the emissions driving the climate crisis.

Research shows that a safe future below 1.5°C requires the world to cut 30 gigatonnes greenhouse gas emissions (CO2) annually by 2030. Carbon emissions need to be cut by building smart cities and managing land and resources more efficiently. Transport and buildings are among the largest contributors.

Increasing energy efficiency, particularly industrial energy efficiency, can make a real difference in reducing our need for fossil fuels,” said Patrick Blake, Programme Officer for United for Efficiency (U4E)

– a United Nations Environment Programme (UNEP)-led global effort supporting developing countries to move their markets to energy-efficient appliances and equipment.

“This improvement in energy efficiency will also reduce electricity bills for companies and support the scale-up of renewable energy,” he added.

Improving energy efficiency
Energy efficiency can take many forms, with U4E focusing on lighting, refrigeration, air conditioning, distribution transformers and electric motors.

LED lamps, for example, are not only more efficient than conventional lamps, but they also last 20 times longer. Research shows that by switching to LED lighting in 156 developing countries, over 110 terawatt-hours (TWh) could be saved by 2030, nearly the same as the current electricity consumption of the Netherlands.

Similarly, by increasing efficiency in distribution transformers, which adjust voltage and current and are placed between the power plant and the consumer, 60 TWh could be saved by 2040, or the same as the current consumption of the Czech Republic.

“Half of the near-term reductions in emissions in the energy sector can be achieved through energy efficiency, for example, by using more energy-efficient appliances and lighting and more efficient motors,” said Miriam Hinostroza, Head of the Global Climate Action Unit, at UNEP’s Energy and Climate Branch.

Companies have found that energy efficiency is a double win, it’s good for their bottom line but it’s also good for the environment. Hitachi Energy, a global technology leader that is advancing a sustainable energy future for all, has been working with U4E to improve the efficiency of distribution transformers in developing regions like Africa.

These transformers are a key product in the power value chain, with electricity typically passing through five of them between the power plant and the consumer.

U4E research shows that a transition across the African continent to the most energy-efficient transformers could save 5.7 TWh a year, worth around US$ 400m by 2040.

This transition would also reduce CO2 emissions by 4.7 million tonnes a year. The transformers also have the added benefit of being more stable, reducing outages and increasing energy security.

“Transformers are critical for enabling an efficient and safe flow of electricity, operating continuously around the clock,” said Bruno Melles, Head of the Transformer Business at Hitachi Energy.

“Energy efficiency brings energy savings and reduces environmental impact, but also means more efficient use of existing infrastructure, which is in line with Hitachi Energy’s Sustainability 2030 strategic plan, which includes the target to achieve carbon-neutrality in our own operations.”

“In developing countries, energy efficiency also contributes to increasing the availability and access to electrical energy, contributing to key UN Sustainable Development Goals,” added Melles.

It is not just in Africa where U4E is helping to drive change. In Türkiye, U4E has been working in the industrial sector to help improve efficiency in motor-drive systems. Around 46 per cent of net electricity consumption in Türkiye comes from the industrial sector, and about 70 per cent of this comes from electric motor-drive systems, many of which are inefficient.

UNEP, through U4E, has been providing technical assistance to the Promoting Energy-Efficient Motors in Small and Medium Sized Enterprises in Türkiye (TEVMOT) project.

“The TEVMOT project was conceived to tap into this huge potential for energy savings through the transition to higher efficiency motors and to tackle the challenge of achieving these savings in an industrial sector,” said Özge Renklidağ, a Project Manager with UNDP.

“More than 90 per cent of the enterprises are small and medium-size enterprises, which have traditionally had difficulties in obtaining access to finance for energy-efficient products.”

The project, which started in 2017, and has been extended until the end of 2023, will contribute to Türkiye’s intended Nationally Determined Contribution commitment to reduce its greenhouse gas emissions by 21 per cent from the business-as-usual level by 2030.

“Through projects such as these, increased energy efficiency has been shown to offer real contributions in reducing greenhouse gas emissions,” said Blake, “U4E is working across the world to ensure that sustainable, cost-effective solutions are offered.”