Barriers to energy efficiency improvement and decision-making behavior in Thai industry

The industrial sector is one of the main energy consuming sectors in Thailand and accounted for 36.7% of total energy consumption in 2005. The trend of rising energy prices and tougher competition increases the demand to improve energy efficiency in Thai industry. However, the existence of various barriers often hinders the realization of even some cost-effective energy efficiency measures. In an attempt to investigate key barriers to and drivers for energy efficiency improvement in Thai industry, this study found that the most important barrier expressed by both the textile and cement industries studied as well as experts interviewed is that the management is concerned about production and other matters rather than energy efficiency. Reducing product cost by reducing energy cost is found to be the main driver for energy efficiency investment. Using a conceptual industrial energy efficiency policy framework this study shows how various energy efficiency policies can affect the process of decision-making for and investment in energy efficiency in industry.     

An interdisciplinary perspective on industrial energy efficiency

This paper combines engineering and social science approaches to enhance our understanding of industrial energy efficiency and broaden our perspective on policy making in Europe. Sustainable development demands new strategies, solutions, and policy-making approaches. Numerous studies of energy efficiency potential state that cost-effective energy efficiency technologies in industry are not always implemented for various reasons, such as lack of information, procedural impediments, and routines not favoring energy efficiency. Another reason for the efficiency gap is the existence of particular values, unsupportive of energy efficiency, in the dominant networks of a branch of trade. Analysis indicates that different sectors of rather closed communities have established their own tacit knowledge, perceived truths, and routines concerning energy efficiency measures. Actors in different industrial sectors highlight different barriers to energy efficiency and why cost-effective energy efficiency measures are not being implemented. The identified barriers can be problematized in relation to the social context to understand their existence and how to resolve them.     

Barriers to and driving forces for energy efficiency in the non-energy intensive manufacturing industry in Sweden

The manufacturing industry is facing tougher competition which increases the demand to implement cost-effective energy efficiency measures. However, studies have indicated that obvious cost-efficient measures are not always undertaken. This is explained by the existence of barriers to energy efficiency. The aim of this study is to investigate the existence and importance of different barriers to the implementation of energy efficiency measures in the Swedish non-energy intensive manufacturing industry. Results from this study highlight a number of factors that inhibit the degree of implementation, such as the cost and risk associated with production disruptions, lack of time and other priorities, lack of sub-metering in larger organizations, etc. The study also finds a number of drivers, such as the existence of people with real ambition and a long-term energy strategy at site level.     

Barriers to and drivers for energy efficiency in the Swedish foundry industry

Despite the need for increased industrial energy efficiency, studies indicate that cost-efficient energy conservation measures are not always implemented, explained by the existence of barriers to energy efficiency. This paper investigates the existence of different barriers to and driving forces for the implementation of energy efficiency measures in the energy intensive Swedish foundry industry. The overall results from a questionnaire show that limited access to capital constitutes by far the largest barrier to energy efficiency according to the respondents. A comparison between group-owned and privately owned foundries shows that, except for limited access to capital, they face different high-ranked barriers. While barriers within group owned companies are more related to organizational problems, barriers within private foundries are more related to information problems. This study also found that energy consultants or other actors working with energy issues in foundries are of major importance in overcoming the largest barriers, as the foundries consider them trustworthy. They may thus help the foundries overcome organizational problems such as lack of sub-metering and lack of budget funds by quantifying potential energy efficiency investments. The two, by far, most important drivers were found to be people with real ambition and long-term energy strategies.     

Lessons learned from studying public initiatives to support energy efficiency finance in Thailand from 1992 to 2014

Despite the huge technical and market potential for cost-effective energy efficiency investments in Southeast Asian markets, only a small fraction of this potential has been realised. Given that the major share of global future energy demand, and associated greenhouse gas emissions, will come from emerging economies, it is important to understand the barriers to mainstreaming energy efficiency into the financial sector. This paper focuses on public initiatives that support one of the main barriers: access to capital. The researchers chose Thailand as a case study because of the range of energy efficiency finance programmes that have been designed and implemented since the early 1990s. Interviews with 21 experts from government, the private sector and academia provided the core data for this research. The analysis employed a multi-level perspective and focused on the historical evolution of public support of energy efficiency finance in the country. We identified three distinct phases of public policy development over the past two decades. Despite an impressive variety of ambitious and creative programmes, the initiatives have not yet succeeded in integrating energy efficiency into the financial sector in a meaningful way. Some of the key lessons found are that (a) it is better to treat energy efficiency and renewable energy in separate financing initiatives, (b) governments find it challenging to design effective mechanisms to de-risk financial investments, and (c) international organisations play an important role in testing and facilitating the introduction of new financing approaches and mechanisms. In emerging economies, cost-effective implementation of energy efficiency measures is a promising alternative that can reduce the need for investment in large-scale power generation capacity. The researchers hope that this paper will contribute to more effective design of programmes to incentivise energy efficiency financing in Thailand and in other economies in Southeast Asia.     

Shore Side Electricity in Europe: Potential and environmental benefits

In the context of reducing emissions from the transport sector, the EU Commission envisions a strong modal shift to energy efficient modes including maritime shipping and inland shipping, as an alternative for road transport. In view of the expected growth of the sector, the emissions from waterborne transport are a key concern. When at berth, ships typically use their auxiliary engines to generate electrical power for communications, lighting, ventilation and other on-board equipment. The extended use of vessels’ auxiliary engines augments greenhouse gas (GHG) emissions and air pollution in the adjacent ports, which are typically located in or near densely populated areas, thus leading to dangerous health and environmental effects. Shore Side Electricity (SSE) is an option for reducing the unwanted environmental impacts of ships at berth, i.e. GHG emissions, other air pollutants (NO_x, SO_x, PM) and noise of ships using their auxiliary engines. This paper quantifies the economic and environmental potential for SSE in Europe, through detailed estimation of in-port ships’ emissions and relevant energy demand, providing an insight of the expected barriers for implementation and formulating recommendations on policy actions that could accelerate the implementation of SSE in European harbors.     

Policies to reduce energy use and carbon emissions in the UK

The UK differs from may other industrialized nations in that its carbon dioxide (CO₂) emissions from energy use have declined in recent years despite relatively rapid economic growth. In all sectors but transport, substantial reductions have already occurred in the level of carbon emissions per unit of GDP output. At the same time, a number of official and unofficial studies have pointed out that the UK has one of the largest remaining potentials amongst comparable industrialized countries for achieving further CO₂ reductions through the implementation of cost-effective energy efficiency and fuel switching measures. This paper discusses past and present patterns of energy use and carbons emissions in the UK. The analysis then examines historical trends in UK energy policy and presents policy options for further reducing the UK's energy-use and carbon emissions in the future.     

Financing energy efficiency in developing countries—lessons learned and remaining challenges

Although energy efficiency implementation is increasingly being recognized by policymakers worldwide as one of the most effective means to mitigating rising energy prices, tackling potential environmental risks, and enhancing energy security, mainstreaming its financing in developing country markets continues to be a challenge. Experience shows that converting cost-effective energy savings potential, particularly the demand-side improvement opportunities across sectors, into investments face many barriers and unforeseen transaction costs. This paper draws upon selected experiences with financing energy efficiency in developing countries to explore the key factors of various programmatic approaches and financing instruments that have been applied successfully for delivering energy efficiency solutions. Through case studies, a diverse range of institutional issues are examined related to the identification, packaging, designing, and monitoring approaches that have been used to catalyze traditional and innovative financing of energy efficiency projects. With adequate liquidity in major developing country markets and availability of modern energy savings technologies, it is often the institutional issues that become a key challenge to address in order to finance and implement robust programs. As further operational experience is gained, increased knowledge sharing can lead to scaling-up of such energy efficiency investments. The paper concludes with some ideas for accelerating implementation.     

A Danish case: portfolio evaluation and its impact on energy efficiency policy

A political agreement from 2005 stated that an evaluation of the entire Danish energy efficiency policy portfolio must be carried out before the end of 2008, with the aim to assess the following: (1) Is the policy portfolio sufficient to meet the energy efficiency targets? (2) Do the policies enable the national goals to be met in a cost-effective manner? (3) Is the overall design of the policy portfolio appropriate? The evaluation gave recommendations on how to improve and develop the portfolio, mainly using cost-effectiveness as criteria. The evaluation was completed in December 2008, and this paper presents the main findings and the subsequent impact on Danish policy. A key lesson learned is the importance of including all energy efficiency policies in the evaluation. Examining the entire portfolio of policies (as opposed to only selected policies) gave way to findings that would otherwise not have been captured. With its broad perspective, the evaluation found that the policy instruments prioritised the commercial and industrial sectors less than the household and public sectors. The recommendations made by the authors contributed to the implementation of new taxes for the commercial and industrial sectors together with the reform of the Electricity Saving Trust to a Centre for Energy Savings charged with energy savings within all sectors, except transport—both which have been important steps towards a more cost-effective solution.     

Dealing with barriers to energy efficiency and SMEs: Some empirical evidences

This paper aims at providing an identification and an analysis of the most relevant barriers to energy efficiency that limit a widespread implementation of the Best Available Technologies and Practices (BAT/Ps) through the investigation of 128 non-energy intensive manufacturing Small and Medium-sized Enterprises (SMEs) in Northern Italy. The study, starting from the existing literature, performs an investigation of the operational difficulties occurring when it has been decided to undertake the process of investing resources in energy efficiency interventions. The most perceived barriers have been analyzed with respect to several important characteristics (among others, sector and firm’s size). This examination shows also that very much attention should be paid to avoid bundling together SMEs of different sizes and sectors, since different behaviors with respect to the perception of the barriers can be observed. The analysis of the sample presents some interesting trends considering the perception of the barriers with respect to previous experience of the enterprises on energy efficiency. The paper also explores, through a preliminary analysis, the correlations among questions in order to understand the dynamics and the possible effects of a given barrier with respect to others. Several suggestions for future research in this important area have been provided.     

Tailoring cross-sectional energy-efficiency measures to target groups in industry

The improvement of energy efficiency in industrial companies plays a crucial role for the energy transition. Although significant economic potentials have been identified, the concerned actors are still struggling to realize them fully. To support the implementation of energy efficiency measures by passing policies, a deeper understanding of the barriers affecting different kinds of companies is necessary to better match the options to their needs and requirements. This paper considers companies’ characteristics and barriers to draw conclusions on energy efficiency policies and specific recommendations on energy efficiency measures. It recommends compromises for policies between high administrative efforts to design individual solutions for companies and too generic approaches, which are not tackling the specific barriers and companies’ characteristics. Our analysis assesses monitoring data of 263 enterprises of the Learning Energy Efficiency Networks LEEN in Germany. The LEEN support energy audits, company networking and assesses implemented energy efficiency measures. Lack of information combined with unfavourable reasoning in decision-making impedes the adoption of profitable measures. Thus, financial policy instruments should aim at promoting long-term decision-making. Audits turned out to be an effective information tool and are more common in LEs than in SMEs. Accordingly, the number of implemented measures and the choice of specific measures relate to company size. Regarding barriers to energy efficiency measures, we found financial barriers most prevalent, but there was no general correlation with company size. Moreover, financial restrictions are not necessarily caused by a lack of money, but also by risk aversion or unlikely payback periods. LEs are stronger affected by motivational barriers, especially if the expected organizational effort is high. Reducing transaction costs can increase the willingness to invest greater efforts in energy efficiency measures.     

Organizational human factors as barriers to energy efficiency in electrical motors systems in industry

This paper presents a study accomplished in the State of Parana in Southern Brazil, aiming at verifying the correlation between organizational human factors (OHF) and the level of energy losses in organizations. The purpose is to subsidize the formularization of institutional policies in organizations to improve the energy efficiency in the productive sector. The research was carried out in ten industries of the following sectors: pulp and paper; food; wood and chemical products. The losses of electric energy were determined in motor systems with the aid of a mathematical model and the evaluation of 27 OHF identified in the literature review was made with the supervisors in the industries by means of a structurized questionnaire. Seven OHF had presented significant correlation with energy losses and six of them are inversely proportional to the losses, in accordance with linear regression analysis. The inversely proportional factors to the losses also with significant correlation are considered determinative OHF and constitute barriers for energy efficiency in organizations. These barriers are linked with the following organizational areas: management system; education of employees; strategical vision. The study recommends the implementation of the determinative OHF in organizations as a way to transpose the human barriers for energy efficiency.     

An energy efficient Swedish pulp and paper industry – exploring barriers to and driving forces for cost-effective energy efficiency investments

Despite the need for increased industrial energy efficiency, studies indicate that cost-effective energy efficiency measures are not always implemented, which is explained by the existence of barriers to energy efficiency. This paper investigates whether this holds for the Swedish pulp and paper industry, and if so, investigates the barriers inhibiting and the driving forces stressing cost-effective energy efficiency investments. By so, this case study covers about 2% of the EU-25 industrial end-use of energy. The overall results from a questionnaire show that there is an energy efficiency gap in the sector and that the largest barriers were technical risks such as risk of production disruptions, cost of production disruption/hassle/inconvenience, technology inappropriate at the mill, lack of time and other priorities, lack of access to capital, and slim organization. As regards the driving forces for energy efficiency, the highest ranked driving forces were cost reductions resulting from lower energy use, people with real ambition, long-term energy strategy, the threat of rising energy prices, the electricity certificate system, the PFE. The results show that many of the barriers and driving forces were not solely market-related, e.g., lack of time or other priorities, slim organization, other priorities for capital investments, lack of staff awareness, and long decision chains indicate that firm-specific barriers plays an important role. These barriers may not be overcome by market-related public policy instruments but is rather a consequence of how the energy issue is organized within the firms. The second and the third largest driving forces, people with real ambition and a long-term energy strategy further support this.

Assessment of mitigation options for Slovakia''s energy sector

The paper presents a brief overview of measures that have been implemented in the Slovak Republic that have the effect of reducing greenhouse gas emissions, and of analyses of the potential impact of various other mitigation options in the energy sector. The results indicate that the country could achieve considerable emissions reduction in 2005 relative to the 1990 level, depending on the measures applied. Scenarios of future emissions assuming different degree of implementation of mitigation options are presented for the various sectors. Based on the analyses and modelling, the most effective measures are identified as follows: (i) increase in boilers' effectiveness; fuel switch (as a consequence of emission limit implementation); deregulation of heat price while keeping fuel and electricity price regulated; maintain level of electricity production from nuclear power plants; and continuous casting and combined cycle implementation in VSZ Kosice enterprises. In closing, the paper discusses the barriers to implementation of mitigation measures.     

An ex-ante evaluation of a White Certificates scheme in The Netherlands: A case study for the household sector

Increased efficiency of energy demand is generally recognized as a very cost-effective strategy to reduce energy requirements and the related environmental impacts (e.g. the greenhouse effect). In order to improve energy efficiency the use of innovative market mechanisms, such as the White Certificates (WhC), has been proposed. The basic idea underlying this policy instrument is that specific energy saving targets are set for energy suppliers or energy distributors. These requirements must be fulfilled in a predefined time frame. The focus of this paper is on the effect on energy efficiency improvement, on the behavior of the end consumers and the market of energy efficiency measures. Furthermore, we study the possible effects of WhC in The Netherlands by means of a theoretical analysis and an empirical bottom-up model. We compare concrete energy efficient technologies in terms of cost-effectiveness and energy efficiency improvement. In combination with existing Dutch policies for energy efficiency improvement in the built environment, the contribution of this innovative scheme could enhance the accomplishment of energy efficiency targets. In this paper, two packages of energy saving measures of a WhC scheme are studied for Dutch households. The costs of these technologies are estimated through the use of different discount rates, which imply overcoming of the market barriers through the use of the WhC. A scheme that includes all available technologies as flexible options appears as a realistic solution and can generate cost effectively up to 180 PJ primary energy savings and 4550 M€ cumulative net savings in the year 2020, at a discount rate of 5%, under the precondition that the policy and administrative costs can be kept low.     

State-level benefits of energy efficiency

This paper describes benefits attributable to state-level energy efficiency programs. Nationwide, state-level energy efficiency programs have targeted all sectors of the economy and have employed a wide range of methods to promote energy efficiency. Standard residential and industrial programs typically identify between 20% and 30% energy savings in homes and plants, respectively. Over a 20-year period of time, an average state that aggressively pursues even a limited array of energy efficiency programs can potentially reduce total state energy use by as much as 20%. Well-designed energy efficiency programs can be expected to help overcome numerous barriers to the market penetration of energy efficient technologies and accelerate the market penetration of the technologies. Energy efficiency programs are cost-effective; typical benefit–cost ratios exceed 3:1 and are much higher when non-energy and macroeconomic benefits are included. Indeed, energy efficiency and associated programs and investments can create significant numbers of new jobs and enhance state tax revenues. Several states have incorporated energy efficiency into their economic development programs. It should also be noted that increasing amounts of venture capital are being invested in the energy sector in general and in specific technologies like solar power in particular.     

Energy efficiency development in German and Colombian non-energy-intensive sectors: a non-parametric analysis

This paper measures energy efficiency development in non-energy-intensive sectors (NEISs) in Germany and Colombia from a production-based theoretical framework using Data Envelopment Analysis (DEA). Using data from the German and Colombian Annual Surveys of Industries from 1998 to 2005, the analysis compares energy efficiency performances in German and Colombian NEISs at two levels of aggregation and then applies several alternative models. The results show considerable variation in energy efficiency performance in the NEISs of both countries. Comparing the results across models, it was found that in the German and Colombian NEISs, the measures of energy efficiency are similar, indicating that an appropriate combination of technical efficiency and cost minimisation are necessary to improve energy efficiency. However, energy efficiency based on cost minimisation is greater in both countries, demonstrating that energy prices in this sector are not the key variable for improving energy efficiency. This is due to the low share of energy costs, making it preferable to change other inputs rather than energy. A second-stage regression analysis reveals that in the German and Colombian NEISs, labour productivity and investments are fundamental to changes in energy efficiency. Finally, the energy efficiency measures of the DEA models show significant correlations with the traditional energy efficiency measure, indicating that energy efficiency as measured through DEA could be complementary to measures of energy intensity when analysing other key elements of energy efficiency performance in the industrial sector.     

The implementation of a multi-annual agreement for energy efficiency in The Netherlands

The paper analyses the implementation of the second multi-annual agreement for energy efficiency concluded in the Netherlands with industrial sectors for the period 2002–2010. It aims to investigate whether the multi-annual agreement MJA2, as a voluntary instrument, is sufficiently stimulating behavioral change at the target group level, and sustained transformation of production and management patterns towards significant gains in energy efficiency. The analysis uses a Structure–Conduct–Performance analytical framework for implementation processes in order to: (a) analyze the setting of implementation, actor roles, attitudes and interactions; (b) discuss emerging obstacles and positive experiences with the implementation of the three core policy instruments envisaged: energy management system, process efficiency measures, and ‘expansion themes’ measures. Based on this policy recommendations are formulated regarding voluntary agreements in general, using the Structure–Conduct–Performance framework of implementation analysis, and regarding how the implementation process of MJA2 in particular could be improved.     

Energy efficiency in social housing: Opportunities and barriers from a case study in Brazil

This paper investigates the energy efficiency in a segment of the building sector in emerging countries by analyzing and evaluating the energy efficiency of a social housing project in Brazil. Energy efficiency measures and bioclimatic design strategies are developed in order to improve thermal comfort in this social housing project and to reduce the energy consumption and expenses of their residents. The institutional barriers and constraints toward higher efficiency are described. The results of this study show that there is a high potential to increase energy efficiency in social housing in emerging countries like Brazil. The implementation and consideration of the energy efficiency measures and policy recommendations would contribute substantially to the goal to dampen the fast growth of energy demand in these countries. Moreover the improvement of energy efficiency in the social housing sector could be a driver for market transformation towards more sustainability in the whole building sector.     

Potential impact evaluation: an ex ante evaluation of the Mediterranean buildings energy efficiency strategy

The building sector is among the largest energy users while offering cost-effective means of reducing energy use. Dynamics of energy efficiency improvements in the building stock are very slow due to the long life span of buildings and barriers such as high investment cost. A list of general policy measures to overcome the barriers to energy efficiency improvements in the Mediterranean (MED) area was proposed by regional experts in the framework of the MARIE project. These measures could be considered as a first draft of the MED buildings energy efficiency strategy. This study assesses the potential impacts of such measures, so as to inform on their effectiveness. The MARIE measures result in larger energy savings than an equally ambitious strategy based on ‘conventional measures’. However, the benefits of MARIE arrive slowly and show large variations among regions depending on the characteristics of their current building stock.