International efforts to meet energy demand in a safe and reliable manner generally acknowledge the complementary nature of renewable energy deployment and energy efficiency measures.1 Both renewables and efficiency can contribute significant benefits including lower energy costs on a national, corporate or household level, increased grid reliability, reduced environmental and climate impacts, improved air quality and public health, and increased jobs and economic growth.2 The United Nations’ Sustainable Development Goal 7i (SDG 7) recognises that combining renewables and efficiency provides an integrated means towards achieving sustainable energy access for all.3

Energy production and use account for more than two-thirds of global greenhouse gas emissions.4 Taken together, renewable energy deployment and energy efficiency measures can potentially achieve most of the carbon reductions required to keep global temperature rise below 1.5 degrees Celsius.5 Moreover, renewables and efficiency maximise their emissions mitigation potential when pursued together.6

Coalitions of governments, corporations, institutions and non-governmental organisations have boosted global energy efficiency efforts, recognising the potential to greatly reduce greenhouse gas emissions.7 As of the end of 2019, 131 parties to the Paris Agreement mentioned renewable energy in their Nationally Determined Contributions (NDCs) to reduce emissions, while 112 parties mentioned energy efficiency, and 94 mentioned both.8 Energy efficiency was a main contributor to stabilising global greenhouse gas emissions in 2019, along with renewables.9 ( See Box 1.)

Energy intensity, which represents primary energy supply per unit of economic outputii, plays an important role in evaluating developments in energy efficiency (for example, it is a key indicator for tracking efficiency improvements under SDG 7). Energy intensity is complemented by carbon intensity, which measures the amount of carbon dioxide emitted per unit of final energy consumediii.10 In general, interactions between the deployment of renewable energy technologies and improvements in energy efficiency are complementary, as efficiency reduces the overall primary energy needed, while the use of renewables minimises both the primary energy needed as well as the carbon intensity.11 ( See Box 2.)

Factors behind these reductions in primary energy demand and carbon emissions include:

Interactions between renewables and primary energy efficiency. Primary energy demand includes all of the energy contained in all the energy sources required to meet the final energy consumption of end-users, taking into account losses from transforming primary energy (such as oil, coal or natural gas) into secondary energy (such as electricity or oil distillates). Because the use of some sources of renewable power – particularly hydropower, solar PV and wind power technologies – reduces the overall transformation losses in generation, the uptake of renewables lessens the amount of primary energy needed to meet final energy needs, thus improving primary energy intensity.12 Increasing the share of electricity generation from renewables also helps to reduce overall carbon intensity.

Interactions between renewables and final energy efficiency. Energy efficiency measures are necessary for increasing the overall share of renewables in final energy consumption. By lowering final energy consumption, energy efficiency allows the same level of renewable energy uptake to meet a larger share of energy consumption, and also reduces the capital investment required to supply the demand through on-site and/or off-site renewables. This is particularly pertinent in light of rising energy use in developing and emerging economies, and in light of barriers that limit the speed of renewables deployment (such as land scarcity, potential opposition by local communities, etc.).13 ( See Feature chapter.)

Renewables and energy efficiency maximise their

emissions mitigation potential

when pursued together.

In addition, specific efficiency measures in end-use sectors, such as energy-efficient building codes, can be enablers for both energy efficiency and renewable energy. These efficiency measures often are coupled with measures to supply the remaining energy demand either directly with renewables (for example, bioenergy, solar thermal and geothermal heat) or indirectly with renewables-based electricity.14 The electrification of end-use sectors, such as heating, cooling and transport, is one pathway to achieving a double benefit: electrified systems can be more energy efficient than their fossil fuel-based counterparts, and electricity demand can be sourced more readily from a wide variety of renewables.15 (See Systems Integration chapter.)

iIn 2015, the United Nations General Assembly adopted a set of 17 goals as part of a new global agenda on sustainable development. SDG 7 aims to ensure access to affordable, reliable, sustainable and modern energy for all – including targets to “increase substantially the share of renewable energy in the global energy mix” and to “double the global rate of improvement in energy efficiency” by 2030. See endnote 3 for this chapter.i

iiSee Glossary for expanded definition and for details on why energy intensity is used as a proxy for energy efficiency. Energy intensity is an imperfect indicator for energy efficiency, as it reflects not only changes in relative energy efficiency but also structural changes in economic activity (such as a shift from heavy industry towards services and commerce). ( See Box 2.)ii

iiiEnergy intensity and carbon intensity are complementary because, taken together, they indicate the primary energy required per unit of GDP and the carbon dioxide emissions produced through the transformation and use of this energy.iii