Energy Efficiency (EE) means a maximum output with fixed energy input or a fixed output with the minimum energy input. Energy efficiency is achieved when energy intensity in a specific product, process or area of production or consumption is reduced without affecting output, consumption or comfort levels. For example, replacing incandescent light bulbs with Light-Emitting Diodes (LEDs) will use only about 1/10th of the energy to light a room (USA Lights and Electric, 2017). OECD/ IEA (2018) reports that energy efficiency measures is one of the cheapest GHG reductions options and can contribute about 40% of the CO2 abatement needed by 2050 to achieve emissions reduction consistent with a target of limiting global temperature increase to 2 degrees Celsius.
Energy efficiency is often called “first fuel” or “a major energy resource” with largely untapped potential in the context of national and international efforts to achieve sustainability targets (OECD/ IEA, 2014) because it is a source of energy in its own created through saving. Energy efficiency avoids costs associated with the construction of new generation capacity. It focuses more on “Negawatts” (energy saved as a direct result of energy conservation measures) rather than on “Megawatts”.
Improving Energy Efficiency is one of the most constructive and cost–effective ways to address the challenges of high energy prices, energy security and independence, air pollution, and global climate change.
The many benefits and opportunities of energy efficiency are listed as below:
- Promotion of energy efficiency can give attractive financial returns even with lower investment.
- Energy conservation is relatively cheaper and more effective compared to energy generation.
- It can assist in reducing trade imbalance in the country by reducing energy imports.
- It can create more employment opportunities by making the energy market cheaper and more competitive.
- Energy efficiency can increase energy access.
- Energy efficiency can help increase energy security by reducing energy imports and energy deficiency.
- EE can help in achieving the goals of sustainable development, in reducing carbon emission and environmental imbalance and in minimizing the negative effects of climate change. (National Energy Efficiency Strategy, 2017).
Cost-effective energy efficiency improvements can have positive macroeconomic impacts, boosting economic activity and often leading to increased employment. The discussion around the multiple benefits of energy efficiency (EE) means that, with the reduction in energy consumption and thus energy costs, EE gains can lead to an increase in economic output, increase in employment levels but also decrease in energy prices, improving the overall competitiveness of our economies.
Figure 1. Macroeconomic impact and macroeconomic effects of EE (Source: IEA, 2014)
Macroeconomic projections show that the potential savings for electrical and thermal energy for the eight most energy intensive sectors in Nepal are around 155,000 MWh and 8,000,000 GJ respectively. Despite the fact that efficient use of energy can have an important contribution in the overall development of the country and can help in improvement of energy access and energy security, energy efficiency has not been able to enjoy adequate priority in Nepal. Its potential is henceforth neither sufficiently analyzed nor adapted technologies and energy efficiency measures broadly applied in industries and households.
In this regard, REEEP-GREEN is improving the preconditions for planning and implementation of measures for the promotion of the efficient use of energy in Nepal. The programme works in the following areas:
- Development of regulatory framework for EE promotion at national level
- Preparation of guidelines and standards on Energy Efficiency
- Raising awareness on EE from policy level to consumer level
- Supporting private industries and enterprises in identifying energy conservation measures and implementing the energy efficiency measures