Energy Efficiency Will Be Critical to Historic U.S.-China Climate Agreement

Release Date: Wednesday, November 12, 2014

President Obama and Chinese President Xi Jinping announced an historic agreement to curb greenhouse gas (GHG) releases from their two nations which account for 40% of the world’s emissions.  The United States, building on existing efforts, in which energy efficiency plays a very large role, will reduce emissions 26-28% by 2025 relative to 2005. China has committed to clean up its fast growing economy to reach peak emissions by no later than 2030. 

“Accelerating our country’s energy productivity gains — that is, growing the amount of GDP created per unit of energy consumed — will be key to meeting these ambitious goals in a way that will simultaneously advance our nation’s prosperity,” stated Alliance to Save Energy president Kateri Callahan.

Energy efficiency policies, investments and technological advances already are decoupling energy use from economic growth. According to the World Bank, China’s economy expanded 18-fold while energy consumption increased only 5-fold during 1980 to 2010.  The International Energy Agency reports growing Chinese energy efficiency programs, policies and standards for buildings, transport, utilities and industry, amounting to over $100 billion in energy efficiency investments during the 2006-2010 Five-Year Plan and expected to exceed $200 billion in the 2011-2015 Plan.

In the United States, according to modeling performed for the Alliance, doubling energy productivity between now and 2030 could yield over $300 billion in energy savings while boosting GDP and creating more than one million new jobs, all while lowering carbon dioxide emissions a third compared to 2005, which would meet the new U.S. commitment made last night. 

Many U.S. states and localities — through building codes, utility programs, innovative finance and other policies – already are at the forefront of deploying energy efficiency to decrease GHG emissions and improve local economies. Federally, the President’s Climate Action Plan has placed efficiency front-and-center by furthering money-saving vehicle and appliance standards, reducing efficiency investment barriers, supporting new technologies and facilitating private actions through Better Buildings, ENERGY STAR and other programs.

“From attic insulation to Nobel Prize-winning LED advances, and from smart cars to innovative finance and business models, the opportunities to meet the new emissions’ goal while also and importantly growing the U.S. economy are tremendous if we focus on increasing our energy productivity,” added Callahan.

Callahan concluded: “As the two largest economies in the world look for ways to meet their climate commitments, the Alliance urges Xi and Obama to use energy efficiency first and foremost as it is the proven quickest, most easily deployable, most abundant and most cost-effective means of reducing GHG emissions.”