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Energy demand sectors

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Energy demand sectors

Billions of people still lack access to modern energy and technology as they struggle to improve their living standards and reduce the negative health impacts of energy poverty, while billions of others enjoy the conveniences of modern life. Awareness of this enduring disparity is a reminder of the need to expand access to reliable, affordable energy for all, even as parties around the world pursue common ambitions to improve the environment and address the risks of climate change.

Effectively managing the risks of climate change will require practical, cost-effective solutions. Opportunities exist worldwide across all sectors to improve efficiency and reduce energy-related emissions. As noted earlier, these solutions are expected to focus on improving energy intensity or efficiency of economies, as well as reducing the carbon intensity of the world’s energy mix.

Boosting energy efficiency

To pursue a 2oC pathway to address the risks of climate change, the need for efficiency gains is likely to ramp up significantly, meaning that capturing the most cost-effective efficiency gains will become even more important in order to spare society an unnecessary economic burden associated with high-cost options to reduce emissions.

Boosting efficiency while meeting essential needs for products and services and supporting standard of living improvements will require effective investments and sound policies to promote them. Opportunities to boost efficiency are many and varied, ranging from better equipment (e.g., transportation vehicles, appliances) to electrical distribution networks to better insulation in buildings. Gains are also likely in systems affecting how people live or how businesses operate. Importantly, not all of the same mechanisms apply across all energy sectors.

Shifting the energy mix

Shifting the CO2 emissions intensity of the energy mix to lower levels, while keeping energy reliable and affordable, also requires investment, with an eye toward opportunities for using less carbonintensive energy sources to meet needs across the range of demand sectors. For example, while bioenergy could be used across all sectors, nuclear energy is limited to the power generation segment.

The table above highlights a likely distribution of technologies and other efforts across various energy demand sectors to boost efficiency and lower the CO2 emissions intensity of energy use.

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