IEA report shows improvement in primary energy intensity but warns progress still lags COP28 targets
Global progress on energy efficiency is set to accelerate in 2025, marking a welcome shift after several years of sluggish improvement, according to new analysis released by the International Energy Agency (IEA). The findings point to renewed momentum in government policy action as countries attempt to bolster energy security, reduce emissions, and improve economic competitiveness.
In its annual Energy Efficiency 2025 update published on November 20, the IEA reports that global primary energy intensity — the main metric used to assess energy efficiency — is on track to improve by 1.8% this year. That marks a significant recovery from the 1% improvement recorded in 2024 and surpasses the average pace seen since the onset of the pandemic.
Primary energy intensity measures how much energy the global economy uses for every unit of economic output. Lower intensity indicates more efficient energy use. While the projected 2025 gain is an improvement, the IEA notes it still falls short of the progress needed to meet international commitments.
The 2025 estimate highlights early signs of stronger efficiency gains in major emerging economies, notably India and China. The agency says preliminary data suggests both markets are showing “some indications of stronger progress compared with their average since 2019,” underscoring the influence of policy shifts and structural economic changes.
Still, despite this year’s outlook, the IEA stresses that overall energy efficiency has underperformed in recent years. Since 2019, the global rate of improvement has averaged 1.3%, well below the 2% annual average achieved between 2010 and 2019.
IEA Executive Director Fatih Birol said the renewed acceleration is welcome, but not enough.
“The acceleration in global progress on energy efficiency that we’re seeing in 2025 is encouraging, including positive signs in some major emerging economies. But our analysis shows that governments need to work even harder to ensure efficiency’s full range of benefits are enjoyed by as many people as possible,” he said. “Energy efficiency has the power to enhance people’s lives and livelihoods through greater energy security, more affordable bills, improved economic competitiveness and lower emissions.”
A major benchmark hangs over global efforts: at COP28 in Dubai in 2023, nearly 200 governments pledged to double the global average rate of energy efficiency improvement to 4% per year by 2030. At this point, the world remains far off that trajectory.
The IEA report outlines several structural forces slowing progress. Industrial production has rebounded sharply in many economies, and the sector accounts for roughly two-thirds of the increase in global final energy demand since 2019. Yet energy intensity improvements in industry have “slowed sharply,” the agency notes, dampening overall global efficiency performance.
Another challenge lies in consumer technologies. Air conditioner adoption has surged worldwide, improving comfort and health for millions. However, most units sold are significantly less efficient than the best available models. This gap has driven cooling-related electricity demand higher while adding avoidable costs to household energy bills.
The report emphasizes that policy frameworks have not kept pace with available technology. While governments have enacted more than 250 new policy actions over the past year — a sign of growing urgency — significant gaps remain. Roughly half of all countries worldwide still lack efficiency standards for new buildings, including rapidly urbanizing regions where long-term energy consumption patterns are being formed today.
The IEA argues governments have two primary avenues to accelerate progress. First, existing policies must be updated to match modern technology capabilities. Many standards, labelling programs, and incentives were established years ago and have not been revised to reflect current efficiency potential. Second, governments must fill critical policy gaps by implementing building codes, product standards, and industrial efficiency programs in regions where they remain absent.
To support decision-makers, the agency has expanded two key tools. Its Energy Efficiency Progress Tracker now includes more detailed and timely regional data, offering policymakers a clearer view of where progress is accelerating or stalling. The IEA has also added new case studies to its Energy Efficiency Policy Toolkit, highlighting best practices across sectors and geographies.
As governments worldwide seek to manage energy costs, enhance competitiveness, and meet climate goals, the IEA says energy efficiency remains one of the most cost-effective and immediate levers available. The 2025 rebound provides a hopeful signal — but global ambitions, and the timelines attached to them, demand faster and more sustained gains.
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