12.3.1.1 Energy demand sectors – Transport, Buildings and Industry

In the buildings sector, energy efficiency options may be characterized as integrated and efficient designs and siting, including passive solar technologies and designs and urban planning to limit heat island effect. Considering energy efficiency as the guiding principle during the construction of new homes results in both reduced energy bills -enhancing the affordability of increased energy services- and GHG abatement (see Section 6.6). Policies that actively promote integrated building solutions for both mitigating and adapting to climate change are especially important for the buildings sector. Good urban planning, including increasing green areas as well as cool roofs in cities, has proven to be an efficient way to limit the heat island effect, which also reduces cooling needs. Mitigation and adaptation can, therefore, be addressed simultaneously by these energy efficiency measures.

In developing countries, efficient cooking stoves that use clean biomass fuels are an important option. These can have significant health benefits including reduction in eye diseases. The incident is disproportionately high amongst rural women in many developing countries where fuelwood and other biomass materials are a principal source of energy (Porritt, 2005). It has also been shown, for example, that the availability of cleaner burning cookers and solar cookers in developing countries not only has important health benefits but also significant social benefit in the lives of women in particular (Dow and Dow, 1998). A move to a more reliable and cleaner fuel not only has benefits in terms of carbon emission and health, it has also the effect of freeing up significant amount of time for women and children, which can be applied to more socially beneficial activities, including going to schools in the case of children. The air pollution benefit of improved stoves, however, is controversial; other studies have noted that efficiency was improved at the expense of higher emissions of harmful pollutants (see Section 4.5.4.1).

In the transport sector, the energy efficiency measures may be categorized into those that are vehicle specific and those that address transportation planning. Vehicle-specific programmes focus on improvement to the technology and vehicle operations. Planning programmes are targeted to street layouts, pavement improvements, lane segregation, and infrastructural measures that improve vehicle movement and facilitate walking, biking and the use of mass transport. Cost-effective mitigation measures of both types have been identified that result in higher vehicle and/or trip fuel economy and reduce local air pollution. Institutionalizing planning systems for CO₂ reduction through coordinated interaction between national and local governments is important for drawing up common strategies for sustainable transportation systems (see Section 5.5.1). While there are many synergies in emission controls for air pollution and climate change, there are also trade-offs (see Section 5.5.4). Promotion of bicycling, walking, and other non-motorized modes of transportation has large and consistent co-benefits of GHG reduction, air quality, and people health improvement (see Section 5.2.1 and 5.5.4). Diesel engines are generally more fuel efficient than gasoline engines and thus have lower CO₂ emissions, but increase particle emissions. Air quality driven measures, such as obligatory particle matter and NO_x filters and in-engine measures, mostly result in higher fuel use and consequently, higher GHG emissions.

In the industrial sector, energy efficiency options may be classified as those aimed at mass-produced products and systems, and those that are process-specific. The potential for cost-effective measures is significant in this sector. Measures in both categories would have a positive impact on the environment. To the extent the measures improve productivity, they would increase economic output and hence add to government tax revenue. Higher tax revenue would benefit national, state and local government fiscal balance sheets (see Section 7.7; Nadel et al., 1997; Barrett et al., 2002; Phadke et al., 2005).

Since energy efficiency improvement reduces reliance on energy supply, it is likely to improve a nation’s energy security. Using prices as an instrument to promote energy efficiency mitigation options is often difficult due to the many barriers that impede their progress. Lack of information about such mitigation options and the principal agent problem have been documented to be particularly significant barriers in the residential sector, but these also prevail in the small and medium scale industries sectors (Sathaye and Murtishaw, 2005). Programmes that can overcome such barriers would increase energy efficiency penetration.