Fast forward: Quicker and cheaper ways to cut emissions through energy efficient technology.

As prices soar and more and more people wake up to the environmental impacts of our hunger for fuel, many believe that energy efficiency has the potential to become the 'biggest fuel' of the future. Here REEEP outlines the case for cutting the bills and emissions at the same time.

The developers of Stonewalk in Ottawa, Canada, pride themselves on the inclusion of the Canadian R2000 builders grade insulation into the upmarket homes they are selling.

Priced from $290,000, each home boasts hardwood floors, ceramic tiles, gas fireplaces, central air conditioning and sun porches but above all is built to the most rigorous building standard in North America.

The R2000 website, too, extols the virtues of buying houses with “advanced building technology; energy savings; protected indoor air quality; a level of quality assurance that no other homes can offer, with extra inspections, third-party testing and certification; a home with less impact on the environment.”

Domino effect

This type of quality, niche marketing, especially when relating to energy or environmental issues, is something we are used to seeing in cars but is rarer in the housing sector.

But the R2000 grade with its focus on energy-efficient homes, first pioneered in Ontario, has had some impact across the whole Canadian housing market in a campaign which will make significant energy savings over the next few years and which may already be creating a domino effect in other housing.

If accepted and adhered to by building companies, it will stamp large energy cuts into the sector in one of the most cost-effective ways. Stephen Koch, executive director of trade association the North American Insulation Manufacturers’ Association (NAIMA) in Canada, points to the relatively quick effects of the tougher and tougher restrictions that will now be placed on homes over the next five years via the government’s Energuide coding system.

This, he says, has been influenced by and based on the voluntary and even more demanding R2000 mark, which “pushes the envelope the furthest…as a result in the next eight years, Canadian building codes will save enough energy to power 38,000 houses or take a quarter of a million cars off the road as a result of the government’s new policy,” he explains, suggesting that cuts are effected more rapidly than by renewable energy.

It is an attractive proposition, especially if cheaper than existing alternatives. Given the likelihood that – at least in Europe – many countries will fail to meet their emissions reductions targets by 2010, the offer of a quick and cheaper remedy is compelling. Focusing on housing and on building codes, especially if they apply to refurbishments as well as new stock, slashes energy use, since buildings account for about a third of global energy consumption.

Fuel of the future

The economic savings and hence alternative funds generated by energy efficient technologies are huge but these techniques are often treated as negatives rather than positives, due to the fact that they appear to be cutting a bill rather than creating income.

Research by NAIMA alongside other energy efficiency experts found that energy efficient technologies had the lowest operating and capital costs for a 500 MW resource block out of 19 possible options from landfill gas to photovoltaic.

Costs in 2003 amounted to $0.01/kwh compared to $30/kwh for solar thermal. It was also found by the European Commission to be the most economically viable out of nine carbon abatement technologies (from nuclear fusion to carbon capture and storage and onshore wind.)

However, the saved energy of course creates new resources for businesses. Hence, energy efficiency has been dubbed “the fuel of the future” as it releases cash for fuel in future years.

Koch thinks the R2000 model “can be exported to developing countries.” A voluntary code of practice later cherry-picked by governments as a regulatory benchmark is, he says, the most effective way to develop the policy.

And the need to act quickly in developing countries is becoming more pressing. The tables have turned: data complied by the International Energy Agency (IEA) show that developing economies will account for 85% of the increase in energy production between now and 2030. This compares with 59% between 1971-2002 while the corresponding OECD figures are 3% and 31%.


Marianne Osterkorn, director of the Renewable Energy and Energy Efficiency Partnership (REEEP) reckons that pioneers make a big difference more quickly: “you need a champion, a politician who drives it through, as well as a lobby group specifically focused on energy efficiency,” she says.

In many countries, the issue is scattered and dealt with by several government departments or industries (such as insulation or electronics production) whereas a specific minister for energy efficiency addresses the problem comprehensively.

REEEP is a global, internationally-funded partnership that facilitates finance and policy for renewables and energy efficiency in developing countries. The organisation is working in Russia, Kazakhstan and China to increase the power of building codes in the energy-hungry building industry there.

In the next five years, Russia alone will build approximately 250 million square metres of new residential buildings.

It is working with local officials and planners in Russia to develop improved local enforcement skills and apply successful Muscovite financial incentives in other parts of the country. A new type of performance-based compliance method, the issuance of buildings “passports”, will be used to help ensure enforcement.

Buildings regulations, which govern the material types, insulation requirements, window characteristics and other features of new buildings and major extensions, have the potential to cut deep into the heart of the carbon dioxide emissions problem because of the large contribution buildings make to emissions.

If accompanied by buildings performance benchmarks, their power is extensive. [the New Buildings Institute’s Advanced Buildings Benchmark requires both calculated and measured energy use to be reported, as does the Russian and Kazakhstani Passport] However, while regulations targeted at energy efficiency exist in many countries, they have been effectively implemented in only a few.

The Usable Buildings Trust suggests that they are most advanced in Australia, the USA and the UK.

A recent global survey of building energy codes on the books around the world found that the majority were ineffective due to limited or non-existent enforcement. “The basic problem is that it is extremely difficult to garner high-level political support from the range of agencies needed to drive the monitoring and enforcement of building energy codes and standards,” comments Peter duPont, board chairman of the International Institute for Energy Conservation, a non-profit organisation with offices around the world.

Thinking local

Global policies complemented by local drive sometimes deliver neat results. Emmanuel Bergasse, an energy efficiency consultant working with the International Energy Agency (IEA), says that “it is easier to integrate both dimensions [renewable energy and energy efficiency] if you do it locally.

Then, you are dealing with one company and one local authority. Local energy agencies ensure that local policies are implemented.” This, too, is often how champions emerge. The medieval town of Tuebingen in Germany provides a good example of a successful local policy.

The town’s local authority championed energy efficiency and arranged a programme subsidising white goods; customers buying energy-efficient white goods were given a grant subsidised by the local authority.

Other towns in Germany have done the same. Hannover increased electricity prices slightly over a period of two years in order to fund four energy efficiency programmes including a standby project. The net result for consumers, though they had paid a little more upfront, was a small financial profit.

New suburbs and other communities going up in developing countries offer the opportunity to act swiftly while buildings are new. In those countries, where the proportion of new developments is higher, the potential power of building regulations and voluntary codes is all the greater.

Yet even in some of the most mature economies in the world, policies are not fully developed. The UK, for instance, introduced its first requirement relating to energy efficiency in new buildings in 1985.

The regulation has been revised twice in the last four years, so that, if fully enforced, it should cut carbon dioxide emissions from new buildings by another 40%. Even so, this will not affect the vast majority of houses, offices and other commercial buildings because so much of the UK’s building stock is 50 or more years old.

Global ramifications

The International Energy Agency (IEA) has estimated that $700 billion invested into energy efficiency between now and 2030 would result in returns of more than $1.4 trillion in terms of avoided supply-side investment.

Energy use varies around the world, however the IEA estimates that the 700KWhr/m2 average energy usage experienced in the 1970s has fallen to an average of 100KWhr/m2 today in Germany.

Energy Efficiency has become increasingly recognised as the fastest and most economical path to a low carbon economy and building codes, appliance labelling, standards and education are the first steps many countries are taking to improve their energy security.

However, energy efficiency expert, Sylvia Rezessy states “there are profound barriers to energy efficiency take-up related to the very basic routes of public budgeting”. Even if the enforcement of standards will take some time to put in place, at least the data generated by new standards all over the world will reveal the scale of the problem and thereby generate further action.

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