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Energy efficiency (EE) is something many people don’t think about. However, it can have a significant impact on your energy bills and the environment. In this guide, we’ll talk about energy efficiency, tips on how to achieve it in the industrial sector and your own home, and other vital elements that are useful to know.

So whether you’re looking to save money or help the environment, read on for all the information you need.

What Is Energy Efficiency?

According to the Environmental and Energy Studies Institute, energy efficiency means using less energy to provide the same service. It’s about using energy more productively to minimize the amount of energy wasted.

For example, an efficient light bulb saves money and energy because it uses less electricity than its standard counterpart. But while the cost of implementing EE varies on many factors, the net benefits usually justify the investment.

Energy efficiency is seen as a crucial part of the solution to slow and ultimately stop global warming. It’s one of the most cost-effective ways to reduce greenhouse gas emissions and help meet our energy needs without increasing pollution. Thus, environmentalists, business leaders, and consumers can consider it a “win-win” scenario.

Click the link for a more thorough take on the definition of energy efficiency.

Infographic of the benefit of energy efficiency in our environment

Why Is Energy Efficiency Important?

There are many reasons why energy efficiency is important. It’s critical from an environmental perspective because it helps reduce greenhouse gas emissions. We currently emit 50 billion tonnes of carbon dioxide globally, whereas emissions were 40% lower in 1990 at 35 billion tonnes (Our World In Data). This is not great news, but on the other hand:

  • Despite a 30% increase in GDP, the United States’ energy consumption is roughly the same as it was in 2000 – thanks to efficiency improvements
  • Efficient appliances, lighting, electronics, and insulation technologies could reduce carbon pollution by 550 million metric tons each year by 2050.
  • Using fewer fossil fuels also helps lower air and water pollution

From an economic perspective, EE is beneficial because it saves businesses and households money on their energy bills. It also reduces reliance on imported energy, which improves trade balances, and can create domestic jobs in the domestic energy sector. Natural Resources Defense Council reports energy efficiency in the US is:

  • Responsible for one out of every six construction job
  • The employer of over 2.2 million American workers
  • Has a higher job rate growth (as much as 5x) that the fossil energy sectors, such as gas, coal, and oil

Social implications are also important. Improving energy efficiency makes it easier for vulnerable households to be able to afford their energy bills and improve their standard of living. It also contributes to more comfortable indoor environments, positively impacting our health and well-being. 

Some numbers by the Natural Resources Defense Council show the impact of EE:

  • Due to poor weatherization (a type of energy efficiency), low-income families face 3x more energy burden than higher-income families
  • Smart, energy-efficient appliances can save a household more or less $500 yearly in utility costs
  • Low-income rural households spend almost 3x more of their income on utility bills than other rural families
Infographic of the benefit of energy efficiency in our economy

The Challenges of Energy Efficiency

Of course, energy efficiency is not without its challenges. Nations worldwide strive to achieve it by investing in research and development, implementing policies and regulations, and creating voluntary programs. But there is still much progress to be made.

Unless we make a concerted effort to address such trials and hindrances, we won’t fully reap energy efficiency’s benefits. Below are some of EE’s main challenges, according to Stanford University:

  1. Certifying and estimating savings
  2. Achieving continual improvement in energy performance
  3. Combining energy efficiency improvements with a carbon reduction strategy
  4. Recognizing and appreciating energy efficiencies role in a changing electricity grid
  5. Classifying energy resources

Aside from these five challenges, two other issues are important to consider. First, implementing energy efficiency measures requires expertise in the specification and deployment of energy efficient technologies. Second, a shift in energy policies, and in some instances the governance of agencies administering EE programs, is necessary to support and sustain energy efficiency programs properly.

Overcoming these challenges is essential to achieving more excellent EE and, as a result, mitigating climate change and lessening pollution. Luckily, there are many ways to do so in the industrial and residential sectors.

Infographic of the benefits of energy efficiency

Energy Efficiency In the Industrial Sector

Improving energy efficiency in the industrial sector is vital to reducing greenhouse gas emissions and other forms of pollution. After all, the industry accounts for about 54% of the world’s total energy use, per the United States Energy Information Administration.

Given its significant share in global energy consumption, there are several challenges that the industrial sector faces in terms of energy efficiency. The United States Department of Energy has identified the following as the most pressing:

Barriers to Industrial End-Use Energy Efficiency

InformationalRegulatoryEconomic and Financial
Lack of widespread adoption of interoperability and open standardsProgram requirements and aggregationLack of sufficient financial incentives.
Knowledge and resourceElectricity market structuresLimited number of customers
availabilitythat limit demand responseon time-based rates
Administrative burdenUtility cost recovery structureFailure to fully account for demand response benefits
Inclusion in state energy efficiency resource standards (EERS)
Electricity market structures that limit demand response

Barriers to Industrial Demand Response

InformationalRegulatoryEconomic and Financial
Awareness of incentives and riskEnergy resource planningCorporate tax structures
In-house technical expertiseIndustrial participation in ratepayer-funded energy efficiency programsFailure to recognize non-energy benefits of efficiency
Adoption of systematic energy management systemEnergy resource planningInternal competition for capital
Metering and energy consumption dataUtility business modelEnergy price trends
Environmental permittingSplit incentives
Failure to recognize all energy and non-energy benefits of efficiencyProgram planning cycles

*Barriers to Industrial Combined Heat and Power

InformationalRegulatoryEconomic and Financial
Technical knowledge and resource availabilityStandby ratesNatural gas outlook
Awareness of available incentivesEnvironmental permitting and regulatory issuesFinancial risk
Lack of recognition of environmental benefitsSales of excess power
Capacity and ancillary services marketsInternal competition for capital
Inconsistent interconnection requirementsAccounting practices
Failure to recognize the full value of CHP in regulatory evaluationsAccess to favorable tax structures
Exclusion from clean energy standards
Utility business model

*Combined Heat and Power (CHP) typically uses fossil fuels such as natural gas, burnt on-site to generate electricity and useful process heat. CHP has been seen as a transitional step in reducing fossil fuel usage. However, as eliminating the use of fossil fuels becomes more critical, CHP is beginning to fall out of favor unless powered by energy sources that don’t produce carbon pollution. The focus is now on industrial electrification, powered entirely by renewable sources.

Energy Efficiency in Industrial Processes (EEIP)

Energy Efficiency In Industrial Processes consists of the techniques and practices used to reduce the energy required for a process while maintaining or improving outputs. It’s an umbrella term that includes many things, such as better heat exchanger design, using less water in a process or improving the insulation of a factory.

Energy Efficiency in Manufacturing Industries

Manufacturing industries are some of the most energy-intensive businesses in the world. As such, they often have a significant opportunity to improve their energy efficiency. One way to do this is by utilizing Lean and Six Sigma methodologies. These management practices help identify and eliminate waste in manufacturing, often leading to significant energy savings.

Energy Efficiency in the Construction Industry

Because construction projects often require a lot of energy, there are excellent prospects for energy efficiency in this sector. One way to improve EE in construction is by using more efficient materials, such as insulated concrete forms or structural insulated panels. These products can help reduce the energy needed to heat and cool a building. Pre-fabrication is also a way of reducing wastage, and overall energy usage, in construction. There is also growing global interest in low-carbon concrete.

Residential Energy Efficiency

In the residential sector, retail electricity accounts for the largest share of energy use in 2020 at 43%, according to the United States Department of Energy Information Administration. Next is natural gas at 42%, followed by petroleum at 8% and renewable energy sources at 7%.

Petroleum from these statistics pertains to kerosene, oil, and liquified petroleum gas (LPG). On the other hand, renewable energy sources include wood, solar, and geothermal. When it comes to end-use, the kinds you see in residential settings are the following:

  • Heating oil – clothes drying, water and space heating
  • Kerosene – space heating
  • Solar energy – electricity creation, water and space heating
  • LPG/propane – cooking, clothes drying, water and space heating
  • Wood (cordwood and wood pellets) – cooking, water and space heating
  • Natural gas – clothes drying, water and space heating, cooking
  • Geothermal energy – water and space heating, space cooling
  • Electricity – all types of energy end uses

Interestingly, 51% of the energy that residential settings consume is for air conditioning and heating. Uses for each energy end-use largely depend on home structure, geographic location, family size, and fuel and equipment consumption.

The United States Environmental Protection Agency (EPA) shares the benefits of energy efficiency in residences: As of May 2021, Energy Star certified houses have 15% higher energy efficiency than those built to the minimum code requirements. They also include extra features that make them 20-30% more efficient.

Infographic of how being energy efficient at home saves money

Is Energy Efficiency Sustainable?

The main idea of energy efficiency is that it can help defer the need for new energy supply sources and reduce environmental impact. By using less energy, we can help preserve the environment for future generations. In other words, energy efficiency is sustainable. 

Lower-income households, however, may not be able to afford upgrades that improve the energy efficiency of their home. In a residential setting, energy efficiency is a dilemma for poorer households. It can reduce their energy costs or make their homes more comfortable without increasing energy usage. But as they may not be able to afford it, it’s a sustainability challenge. 

Fortunately, however, the cost of most energy-efficient technology declines over time. For example, the cost of LED light bulbs has plummeted in the last decade, and this technology is now much more affordable for all energy users.

Infographic of what happens if we don't switch to energy efficiency

How Can We Achieve Energy Efficiency?

There are many ways that we can achieve energy efficiency. But whatever the approach, the United States Department of Energy reiterates that the core principles are the same: using less energy to achieve the same goal and leveraging technology to do more with electricity to combat climate change.

Achieving Energy Efficiency:

In the Industrial Sector

According to the National Academies of Sciences, Engineering, and Medicine, the industrial sector is responsible for 1/3 of the United States’ energy consumption. Moreover, we can expect its energy use to grow by 11% in the next 25 years. Therefore, energy efficiency in this sector is more critical than ever.

With that said, the Industrial Energy Accelerator recommends the following ways to achieve energy efficiency in the industrial sector:

1. Improve equipment efficiency

Outdated motors, monitoring systems, and equipment can result in significant energy losses and higher utility costs. By upgrading to more efficient models, companies can reduce their energy consumption by 10-15%.

2. Control temperatures

By setting the thermostat a degree or two cooler in winter, and a degree or two hotter in summer, you can reduce Heating Ventilation and Air Conditioning (HVAC) energy consumption by 10% or more.

3. Switch to LED

Manufacturing workspaces often need adequate and plentiful lighting. Because LED bulbs require only roughly 1/4 of the energy halogen bulbs need to produce the same light and last 5-10 times longer, they are the logical choice for energy savings.

4. Observe the speed limit

For equipment driven by electric motors, the fitting of a variable or adjustable speed drive may lead to large savings. For example, reducing the speed of a 90kW fan motor by 25% could save $11,000 annually and reduce energy consumption by 60%.

5. Require energy audits

An energy audit is the first step to determining how a business can save energy and money. It assesses the company’s energy use, benchmarks it, and recommends tailored measures to improve efficiency.

In the Commercial Sector

Barker Associates says that 67% of the energy used in commercial buildings in the United Kingdom goes to cooling, heating, ventilation, water heating, and lighting. It’s no wonder that making these systems more energy-efficient can create massive energy savings.

The firm’s Building Energy Efficiency Survey recommends we implement the following measures:

1. Optimize voltages

When you know the minimum voltage you need to maintain operations, you can lower voltages to conserve electricity and reduce your energy bill. Likewise, your equipment’s performance will improve, and you’ll help reduce the nation’s carbon footprint.

2. Maximize the Cloud

Housing commercial data in the cloud can help reduce on-site energy consumption. Unlike large and power-hungry on-site servers (even when it’s not in use), data stored in the cloud only consumes energy when it’s accessed.

3. Save with solar

A renewable energy source, solar can lower energy bills by supplementing the power your business needs from the grid. It’s widely available, doesn’t require much maintenance, and is accessible in urban and rural areas.

4. Use light controls

Lights that automatically turn off when an area is unoccupied can save a significant amount of energy. A few of the different types you can use in a commercial setting are dimmer switches, networked lighting control systems, and motion sensors for outdoor lighting.

5. Set the recommended temperature

The recommended temperature for offices and commercial spaces is 55-61 degrees Fahrenheit. But these numbers are only a guide, and you should adjust the temperature based on the needs of your employees.

Of course, with HVAC being the largest energy user in commercial buildings, measures to improve HVAC efficiency are even more important than those on this list. Apart from the above, you can engage two EE professionals to assist you further:

Energy Efficiency Engineer

An energy efficiency engineer works with you to develop and implement strategies to make your home or business more energy-efficient. They are experts in analyzing energy usage and finding ways to conserve resources without compromising comfort or productivity.

Energy Efficiency Auditor

An energy efficiency auditor is similar to an energy efficiency engineer but focuses on verifying that the strategies implemented are working as intended. An auditor will often use sophisticated tools to measure energy consumption before and after changes to ensure that you achieved the desired results.

These professionals can help you save money by reducing your energy consumption and identifying opportunities for improvement. If you’re interested in learning more about energy efficiency or reducing your carbon footprint, they can provide valuable guidance.

In Residential/Domestic

According to the United States Energy Information Administration, a typical home consumes roughly 11,000 kilowatt-hours (kWh) of energy yearly. But there are several ways to reduce your household’s energy consumption to save money and conserve resources.

Direct Energy offers the following suggestions:

1. Defrost your freezer regularly

Frost buildup makes your freezer work harder and increases your energy consumption by 30%. So be sure to defrost it regularly (at least once a year or when buildup grows 1/4 inch) to keep it running efficiently.

2. Airseal your house

Don’t let heated or cooled air escape through cracks and gaps in your home because this leads to energy waste and higher utility bills. Use weather-stripping and caulk to air seal your doors and windows, and you could see energy savings of up to 10%.

3. Follow proper baking behavior

If you love to bake, there are some things you can do to be more energy-efficient in the kitchen. For example, opening the oven door while baking can cause the temperature to drop 25 degrees Fahrenheit, so resist the temptation to avoid this energy loss.

4. Use a power strip

A power strip is a great way to conserve energy because it allows you to turn off all your electronics with one switch quickly. This technology is beneficial for devices that continue to draw power even when turned off (like TVs, game consoles, and computers).

5. Use cold water

Washing your clothes in cold water can save you money on your energy bills. In fact, using cold water for laundry is just as effective as using hot water but uses about 90% less energy.

HVAC is typically the largest energy user in households. Simple measures such as adjusting the thermostat, ensuring the unit is well maintained, and replacing older systems with more efficient

Infographic of how being energy efficient saves money for businesses

Picture an Energy-Efficient World

When it comes to energy efficiency, every little bit counts. Following these simple tips brings benefits not just to your wallet but also the environment:

  • Less pollution
  • More efficient use of resources
  • Lower carbon emissions
  • Reduced dependence on fossil fuels
  • Increased profits and competitiveness for businesses
  • Improved comfort and quality of life for homeowners

All of these things contribute to a healthier, more sustainable world. Look what you are missing out on when no attention is paid to energy efficiency!

Today’s Energy Efficiency Leaders

Companies and organizations across the globe are embracing energy efficiency to achieve their business goals. Here are a few leaders in the field per the American Council for an Energy-Efficient Economy:

  1. Ashok Gupta (Lifetime Achievement)
  2. Ellen Zuckerman (Young Professional)
  3. Frank Gundal (Implementation & Deployment)
  4. Maria Stamas (Energy Policy) 
  5. Srinivas Katipamula (Research & Development)

The following are some of the biggest renewable energy companies worldwide as of 2021, according to Investopedia:

  1. Schneider Electric
  2. Siemens
  3. Johnson Controls
  4. Honeywell

And below are the leading countries that are winning the race to be the most energy-efficient, as reported by the World Economic Forum:

  1. Sweden
  2. Norway
  3. Denmark
  4. Switzerland
  5. Austria
Infographic of energy efficiency slogan

Energy Efficiency Education for a Promising Tomorrow

Energy efficiency is about people. We’re the ones who consume energy, so it’s up to us to use it wisely. The good news is that there are plenty of ways to learn about energy efficiency and make a difference.

Sustemy, or Sustainability Education Academy, provides a wide range of courses across the sustainability sector and works with industry experts to deliver them. Our curriculum is designed for individuals of all levels of knowledge and experience, from those just starting to learn about sustainability to seasoned professionals. Our courses cover various topics, including energy efficiency, renewable energy, green building, climate change, etc.

Whether you’re from the governmental sector or an enterprise, you cannot tackle the world’s energy challenges without a good understanding of energy efficiency. Hence, Sustemy’s courses will guide you through the basics of energy efficiency and empower you to take action in your community. Most importantly, they’ll give you the skills and confidence you need to make a difference.

Know more about our energy efficiency courses, or email us at information@sustemy.com to get started.

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