It might look like a trivia question, but it’s quite the opposite.
As you might have seen, we posed a question on the front page of today’s Wall Street Journal: What will make the single biggest contribution to meeting global energy needs in coming decades?
The correct answer is not oil. It’s not nuclear, solar or any other energy source. The answer is improved energy efficiency.
If you’re surprised, you’re not alone. Efficiency — technologies and actions that enable us to do the same, or more, only with less energy — is often overlooked as an answer to the question of how we will meet rising energy demand safely and affordably, while also reducing greenhouse gas emissions.
But the facts command attention. Here’s what our Energy Outlook concludes for the period 2005-2030:
- We estimate that improvements to efficiency will reduce global energy-demand growth by about 65 percent.
- Without improvements to efficiency, global demand for energy would rise by about 100 percent as populations rise and economies expand. But because of efficiency gains, we project the global demand increase to be only about 35 percent.
- Better efficiency will offset more than 75 percent of the carbon dioxide emissions that could have been expected without efficiency gains.
Aside from the fact that efficiency is not tangible like oil or coal, I think one reason it gets overlooked is that people usually associate “efficiency” with items such as light bulbs, air-conditioners or refrigerators. While efficient appliances — or a fuel-efficient car — can reduce energy demand and costs for individuals, to see the true power of efficiency, you need to multiply those benefits on a global scale across all sectors.
Also, while efficiency will help save energy in homes and on roads through 2030, even larger savings will be found in the industrial sector.
Industry is not often at top of mind when it comes to energy issues, but it is the largest demand sector when you consider not just direct energy usage, but also the energy used to make electricity.
Through 2030, efficiency improvements will offset 60 percent of the demand growth in the two largest industrial subsectors: heavy industry and chemicals. Results will be even better in the energy industry subsector, where energy usage will be flat through 2030, even as demand for our products continues to rise.
At ExxonMobil, we’re pursuing a number of avenues to add to our record of improved energy efficiency. For example, we have identified ways to improve efficiency and reduce costs by 15 to 20 percent at our refineries and chemical plants — and we have captured more than 60 percent of these opportunities to date. We are on track to reach our goal of improving efficiency across our operations by at least 10 percent between 2002 and 2012.
Better industrial efficiency requires the application of energy-saving technologies such as cogeneration — the simultaneous production of electricity to power operations while capturing useful heat or steam for industrial processes. ExxonMobil is a leader in cogeneration, with an interest in 4,900 megawatts of capacity at more than 30 sites around the world — enough capacity to supply the electricity needs of more than 2 million homes in the United States.
Efficiency is often referred to as a “win-win-win” solution, and it’s easy to see why. By applying new energy-saving technologies and practices, we not only curb energy demand growth and extend the life of the world’s resources, but we also reduce carbon emissions.
In that way, efficiency is one tool that no one can afford to overlook.