Energy Can Neither Be Created Nor Destroyed

And God said: “Let there be light.” Then there was light…

Those words were recorded thousands of years ago in the 3rd verse of the 1st book of the Bible which then goes on to describe how God made the earth, plant, animals and man. I recognize that opinions are divided about the creator and this is no attempt to get into that debate, but, science has confirmed that indeed light/energy existed before life.

Science has also taught us more about energy. 200 years ago, we learnt that in a closed system (and our universe is one), energy cannot be created or destroyed, but can only be converted from one form to another. Thus, modern civilization is driven by the advancement of processes and technologies to convert energy from one form (mostly chemical energy – hydrocarbons) to another – heat, kinetic, electric, sound, etc.

In accelerating this energy conversion, we created unwanted ripple effects. We now know that energy conversion wastes energy. And in the case of hydrocarbons, it also releases gases with the potential in large enough quantities to affect the earth’s climate.

So, we have to get better at energy conversion, get better at using non-hydrocarbon energy sources, and get better at doing more with less energy. Last month, these points were recognized at COP28 which among its outcomes announced tripling renewable energy capacity and doubling the annual rate of energy efficiency improvement (to 4%) by 2030.

Let’s focus on the second point…

Global energy efficiency improvement is generally measured by the annual reduction of energy intensity (energy demand relative to economic output). Between 2011 and 2016, it improved by 2.3% on average, then halved from 2016 – 2021, before rising to 2% by 2022. The latest estimate for 2023 is 1.3%, well below the target.

Recently, the International Energy Agency (IEA) detailed barriers to meeting the 4% target, potential solutions, and impact e.g. it could slash energy bills by one-third in advanced countries, contribute 50% of 2030 CO2 reductions, and add up to 4.5 million jobs. I recommend reading the report.

But let’s now touch on why the 2023 slowdown, my ‘radical’ suggestions to accelerate progress, and implications for Africa and emerging economies.

Why the slowdown in 2023?

The slowdown in 2023 is proof that: market forces still shape behavioral change; we are only as strong as our weakest link; and change takes time. First, in 2022, high energy prices coupled with milder winters spurred an 8% energy intensity improvement in the European Union, now expected to decrease to 5% in 2023 as energy prices dropped. Second, as it takes 40% more energy to fuel GDP in China than in the US, and almost 100% more than in the EU, a strong post-pandemic resurgence in China dampened global energy intensity progress. Finally, despite policy advancements, sectors like buildings, appliances, and vehicles face slow turnover, delaying observable demand change.

Additional strategies for global adoption

First, leverage fiscal tools to make energy efficient appliances for homes (LED lighting, high-efficiency heating and cooling, etc) cheaper than regular appliances. Globally, hundreds of billions of dollars are spent subsidizing fossil fuels, crossing one trillion in 2022. While I am not advocating for (or against) these subsidies, but shouldn’t we first subsidize the devices that help people reduce their energy demand, so they use less energy and spend less? Can we use tax incentives to drive individuals and corporations to accelerate stock turnover?

Second, leverage the banking system to drive finance to accelerate energy efficiency in the industrial sector. Banks help steer the world by choosing where, why and at what rate to lend money. Across industries, many technologies exist to accelerate energy productivity (converting gas drives to electric, reusing waste heat, digital optimization, etc). While these opportunities pay back the investments through lower energy spend, the high upfront costs hamper deployment appetite. So, what would happen if we took 0.1% of the hundreds of trillions of dollars in the global financial system and created a “bank for industry decarbonization” in each country to provide cheap loans to factories to accelerate energy efficiency projects; with 3-way financing agreement with the utility providers to partially use the net reduction in bills for loan repayment? This “guarantees” repayment to the banks with bankruptcy as the only major risk.

Third, awareness, awareness, awareness but start early. Too many people still do not fully understand the link between their choices and energy efficiency, and the range of options, including very simple actions to make a change. A few months ago when I started talking to people about energy efficiency, I was surprised with the lack of awareness I found, so I decided to launch the SABI Lifestyle initiative to provide simple home energy efficiency tips for 30 days. From researching for the project, I also realized how little I knew. While, I have gotten positive feedback from the challenge, I believe we are missing a trick if we don’t “catch them young”. Our educational system is supposed to give our children a foundational understanding of how the world works/should work. So, let’s teach them how money works, the relationship between energy and economy, and through that, educate them about the criticality of energy efficiency and what they can do. Beyond the classroom, we can leverage things children enjoy - cartoons, movies, games, fairs, etc.  We not only set the right foundation, but create ambassadors in many homes.

Finally, what does this mean for Africa and emerging economies? This is where I introduce a cliff hanger… as I will continue next week.

In the meantime, I would love to hear what you think about these ideas.

Engr. Odinakachi Umunna (MNSE, MNIEEE, MNIM) is a First-class engineering graduate with 10 years’ experience in engineering, strategy and business development across the energy industry, media and public sector in Africa and Europe. He is passionate about sustainably closing Africa’s energy gap; and can be reached at umunnaodinakachi@gmail.com. 

Note: Views shared in this article are mine, and does not necessarily reflect that of any organisation I am affiliated with.