We’re Getting the Egg Boiled, But World Energy Productivity Still Soft

Feb. 17, 2015
So we’re getting the egg boiled, but oh at what a cost. That’s the message from a new report that ranks countries on energy productivity.

So we’re getting the egg boiled, but oh at what a cost. That’s the message from a new report that ranks countries on energy productivity.

The bottom line is that the world is doing a pretty poor job when it comes to using energy as cost-effectively as possible.

Issued by Philips, the “2015 Energy Productivity and Economic Prosperity Index” finds that we waste 98 percent of the energy we use because we engage in
wasteful means of transport and production.  That’s also what happens when we boil an egg, a process where only 2 percent of the energy involved actually hardens the egg, according to Philips.

The report focuses on energy productivity, which measures the amount of gross domestic product for every unit of energy consumed. It’s related, but not the same as energy efficiency that focuses on using less energy to deliver more services.

The United States is in pretty bad shape when it comes to energy productivity; it ranked 87th in the report. The good news is that the US has pledged to double its energy productivity by 2030.

What’s the value of ‘boiling the egg’ more efficiently?

If we could double energy world productivity – from 1.5% to 3% per year – that would create 6 million jobs.

The world’s six largest economies – the US, Russia, China, Japan, India, and the EU – can achieve the most by raising energy productivity, since they make up 60 percent of global GDP and 65 percent of global energy demand.

Cuba as energy efficiency model?

There are some surprises in the report. Hong Kong ranks as number one for energy productivity, a function of its service-based economy.

Odder still, Cuba is second highest. Turns out Cuba is something of a leader in energy efficient lighting. In fact, it became the first country to ban incandescent lightbulbs in 2005. The report attributes Cuba’s energy efficiency awareness to the island-nation’s need to restructure its economy after the fall of the Soviet Union.

“While Cuba remains well behind the rest of the world in industry, exports and overall level of development, it has become a world leader in energy productivity, weighing in at a show stopping €365 billion of gross domestic product per exajoule of energy consumed, the best energy performance in the world,” the report said.

By comparison, the US weighed in at mediocre €143 billion of GDP per exajoule. But, of course, the US has a much more complex economy. So as the report points out, comparing the two makes little sense.

Better models are countries with both advanced economies and high levels of energy productivity, namely Singapore, which ranked four, and Switzerland, five.

Big opportunity exists for developing nations to capture energy productivity, since they are just beginning to build power infrastructure. They can do it right the first time,  installing microgrids, distributed energy, efficient lighting and other technology considered disruptive for advanced economies like the US.

The report notes that such leapfrogging  toward energy productivity appears to be occurring in Azerbaijan, Uzbekistan, Tajikistan and Lithuania.

The report urges policymakers to set more ambitious targets to improve energy productivity. It points out that high levels of energy efficiency will contribute to global economic growth:

  • Doubling energy productivity could cut the global fossil fuel bill by more than EUR 2 trillion by 2030.
  • LED lighting can help households improve their energy productivity by 500 percent
  • Household energy bills in Europe could be cut by a third by 2030 by doubling the rate of energy productivity improvement

“World leaders are convinced that energy is the golden thread connecting economic growth, increased social equity and a healthy environment, but we still need to enforce more ambitious goals to improve energy productivity,” said Kandeh Yumkella, UN under-secretary-general and CEO of Sustainable Energy for All.

As is often the case with Philips’ reports, this one is highly readable. It can be found here.

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About the Author

Elisa Wood | Editor-in-Chief

Elisa Wood is the editor and founder of EnergyChangemakers.com. She is co-founder and former editor of Microgrid Knowledge.