Global primary energy intensity, the key metric for measuring improvements in energy efficiency, is projected to rise by 1.8% in 2025, according to the IEA’s latest Energy Efficiency 2025 report, an improvement from 1% in 2024 but still far below the 4% annual increase agreed at COP28 for 2030.
The shift signals a modest acceleration after several sluggish years: since 2019, global annual efficiency gains have averaged just 1.3%, a notable decline from the 2% recorded between 2010 and 2019. Early data shows some large emerging economies, particularly India and China, outperforming their recent averages, suggesting that policy and industrial reforms in those regions may be yielding incremental improvements.
The IEA frames the uptick as encouraging yet insufficient. Executive Director Fatih Birol emphasizes that efficiency remains one of the most cost-effective strategies for enhancing energy security, lowering end-user energy bills, and reducing emissions—benefits that remain unevenly distributed due to inconsistent policy ambition. Current trends illustrate this gap clearly. Roughly two-thirds of global final energy demand growth since 2019 has come from the industrial sector, where energy intensity improvements have slowed markedly despite growing technological availability. This structural imbalance continues to dilute global progress.
Cooling demand is another pressure point. The expansion of residential and commercial air-conditioning has significantly raised electricity use, especially in warmer regions. Yet the majority of air conditioners sold globally fall short of the highest efficiency models already on the market. The IEA notes that this mismatch between available technology and market adoption represents a large pool of unrealized savings—both financial and environmental. The persistence of low-efficiency cooling systems reflects policy misalignment: as technologies advance, many national standards have not kept pace, allowing the continued sale of devices that lock in higher consumption for years.
The report identifies two immediate avenues for government action. The first is raising the ambition of existing efficiency policies, which in many countries remain static despite rapid technological gains. The second is closing major policy gaps, particularly in sectors with high energy use. Notably, around half of all countries still lack building efficiency standards for new constructions, even in regions undergoing rapid urbanization. With buildings representing long-lived infrastructure, each year of missed policy action compounds future energy demand.
To support stronger policy development, the IEA has expanded its Energy Efficiency Progress Tracker, offering more granular regional data to inform targeted interventions. The agency has also added new case studies to its Energy Efficiency Policy Toolkit, providing governments with comparative insights into best practices across sectors. These tools, combined with updated market data, are intended to help policymakers better align regulations with technological capabilities and accelerate efficiency gains where they can have the greatest impact.
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