<article><p class="lead">Global progress towards energy efficiency hit its slowest in 10 years, the IEA's executive director Fatih Birol said today, adding that the impact of the Covid-19 pandemic led to reduced investments.</p><p>"Global primary energy intensity — a key indicator of how efficiently the world's economic activity uses energy — is expected to improve by less than 1pc this year, the weakest rate since 2010, according to the IEA's <i>Energy Efficiency 2020</i> report.</p><p>Energy efficiency is one of the "two critical pillars" that address the climate problem, the other being renewable energy resources, Birol said. He said that renewable energy was "immune to Covid", but that energy efficiency was weakening when it needed to progress by at least 3pc per year.</p><p>The IEA said that energy efficiency could be a key driver of decarbonisation targets. It accounts for more than 40pc of the reduction in greenhouse gas emissions over the next 20 years, according to the organisation's sustainable development Scenario.</p><p>The lack of progress in energy efficiency has been aggravated by the economic crisis resulting from the Covid-19 pandemic. It has meant households are "reluctant to renew their cars, their electrical appliances, through which we would have seen energy efficiency improvement. "Uncertainty about future revenue is likely to be leading businesses to reprioritise investments, with spending on efficiency measures facing pressure as energy prices remain low," the IEA said.</p><p>The IEA expects global energy efficiency investments to decline by 9c in 2020. Lower energy prices have extended payback periods for key efficiency investments by as much as 40pc, making them less attractive, it said.</p><p>But the IEA said that energy efficient programmes mean governments can align economic stimulus with bigger goals of decarbonisation, with the potential to create 2mn jobs in the next 3 years. </p><p>The agency warned that planned spending is imbalanced across regions, with "announcements from European countries dwarfing those from other parts of the world". Governments have spent $70bn on energy efficiency sectors, but 85pc of this investment comes from Europe. "We welcome plans by governments to boost spending on energy efficiency in response to the economic crisis, but what we have seen so far is uneven and far from enough," Birol said.</p><p class="bylines">By Beatrice O'Kelly</p></article>
