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Energy Efficiency may lead to increased energy consumption in China

Improvements in China’s energy efficiency may be associated with increased energy consumption, a new study has found.

The study used an exergy-based approach to estimate the rebound effect at the national level. The analysis showed that in China, improvements in energy efficiency may be associated with increased levels of energy consumption overall – so-called “backfire”.  By comparison, countries like the UK and US were found to have a partial rebound effect, meaning that energy efficiency measures were still delivering reductions in energy use overall, albeit less than might have originally been predicted.  This is a similar result to previous studies for the UK and US.

Researchers at the UK Energy Research Council (UKERC), the Centre for Industrial Energy, Materials and Products (CIE-MAP) and the Centre on Innovation and Energy Demand (CIED) investigated the so-called “rebound effect”, whereby energy efficiency savings are “taken back” by changes in behaviour that may lead users to use more energy for other tasks.  For example, improvements in engine efficiency make cars cheaper to run, which might encourage drivers to use their cars more often. Or they might spend the money saved on even more energy intensive activities, like taking a flight to go on holiday.

Understanding the scale of the rebound effect is important as many policies to improve energy efficiency are intended ultimately to reduce energy use and therefore carbon emissions.

The researchers speculate that China’s increased levels of energy consumption may result from the fact that China is in a period of industrialisation, whereas the UK and US have been deindustrialising towards a becoming more service-based economies. They also note that China’s higher rebound is due in significant part to the demand for products that are manufactured in China but then exported oversees, to countries such as the UK and US.

The findings could pose significant challenges for climate policy, since if energy efficiency policies are not as effective as planned, efforts to reduce emissions may be hindered. If it is indeed the case that in China energy efficiency is not contributing at all to reducing energy use, there will need to be a significant increase in the deployment of renewables to achieve actual reductions in carbon emissions.

In countries like the UK and US, efforts to improve energy efficiency need to be scaled up to take account of the partial rebound effect.

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