Energy Security

The IEA defines energy security as the uninterrupted availability of energy sources at an affordable price. Energy security has many aspects: long-term energy security mainly deals with timely investments to supply energy in line with economic developments and environmental needs. On the other hand, short-term energy security focuses on the ability of the energy system to react promptly to sudden changes in the supply-demand balance.

A new study for the UN Environment Programme concludes that two factors are at work. One is thrift. Faced with rising prices, consumers use less. British electricity prices increased by 44% over the period; consumption fell by 12%. The other is greater use of energy-saving technology. This includes better insulation, advanced heating and cooling systems, and energy-efficient device s, notably light-emitting diodes (LEDs), which, unlike incandescent bulbs, turn most of the power they use into light rather than wasting much of it as heat.

The International Energy Agency (IEA), a research organization for countries which import fossil fuels, reckons that for the 2050 target to be met, global spending on energy efficiency needs to rise from $300 billion a year today to $680 billion. But on current trends, the UN report concludes, the chance of that is “very slim”.

The IEA reckons that only one-third of the available energy-saving opportunities with a cost-effective payback period are taken up. For businesses and residents alike, factors including ignorance, inertia and misaligned incentives still rule. A recent study commissioned by McDonald’s suggested that a typical outlet could cut its energy use by at least a fifth—and by up to four-fifths by using solar power. But that depends on decisions made by individual franchisees, who will struggle to assess the potential savings from measures such as capturing heat from a fryer to provide hot water. Some savings can seem too low to be worth the hassle, such as buying a new appliance to halve a small running cost. And tenants are unlikely to invest in energy-saving measures that will benefit their successors most.

esmsconsulting@naderawads.com