Reducing the demand for electricity can both strengthen the competitiveness of businesses and save money for households.
"There are a number of quick fixes that can be taken, but to really make a difference, energy efficiency improvements are needed at the system level," says Sara Bargi, project manager at RISE.
Russia's energy war against gas-dependent Europe is taking place at the same time as we are facing a gigantic energy transition and the electrification of society.
In the short term, EU member states have agreed on a series of emergency measures, including
Reducing peak electricity consumption by five per cent.
Reducing overall electricity consumption by 10%.
Introducing revenue caps of €180 per MWh for certain types of electricity. Revenue above the cap will be used to reduce the cost of electricity.
"These measures are temporary and not much more than a wartime winter band-aid that will be removed permanently on 30 June 2023. For an industrialised country like Sweden - which has a target of 50 per cent more efficient energy use by 2030* - electricity needs to be used much more intelligently than it is today," says Sara Bargi, and continues:
"Economists often say that energy efficiency improvements are profitable, so they should be done. But all the research shows that measures are not taken just because they are profitable. We know very well why. Simply put, people have other things on their minds. Even if you save money by switching to an air-source heat pump at home, it's more fun to replace the kitchen cupboards. The same logic applies to businesses," says Sara Bargi.
For example, many companies could reuse much more of the residual heat from their industrial processes. To heat their own premises or those of their neighbours, or to heat the process again by raising the temperature of the residual heat with a heat pump. Today, much of the waste heat is cooled.
Need a boost
But investment is more likely to go into expanding production activities. It is also probably easier to raise capital to increase revenue than to reduce costs - the core business comes first.
"So a boost is needed. A grant or a tax rebate. Watered-down environmental legislation. If we want to achieve more energy efficiency, we need policy instruments," says Sara Bargi.
Using energy more efficiently and cutting unnecessary costs and processes in practice strengthens both resilience and competitiveness
Better governance can deliver savings
There are already many profitable efficiency improvements that can be made with relatively simple means and without reducing comfort or production. There are unused resources in industrial processes. Misaligned district heating centres are another low-hanging fruit.
"There is a lot to be done with the control of heating systems in buildings. For example, we could save more than 4 TWh per year in the heating of single-family homes with better controls and thermostats."
Improving efficiency through renovation
Sara Bargi also highlights the potential for energy efficiency in the renovation of Million Programme areas. It is estimated that around 70 per cent of multi-family dwellings can save half of their energy consumption.
"This means that for every such area, there is the potential to free up energy for an area of the same size," she says.
The first steps in improving energy efficiency can be small. They can be as simple as being more flexible. Turning down the heating between 7 and 9 a.m. to compensate for the sun's constant rays. Or reducing production when electricity prices are high.
"Using energy more efficiently and cutting unnecessary costs and processes in practice strengthens both resilience and competitiveness. It makes you less sensitive to price fluctuations. Those who build such flexibility into their processes have a competitive advantage," concludes Sara Bargi.
* Compared to 2005
Sara Bargi suggests two different approaches to getting started with energy efficiency.
- Attack from the bottom up and look at each component. Are your compressed air hoses leaking? Are you switching off at night? Are you maintaining your electric motors - many are oversized and not speed controlled, meaning they draw more power than necessary.
- Attack from the top and look at the system level. This usually requires investment, but can lead to radical savings. For example, if you electrify an LPG-fuelled process, less excess heat and exhaust means the ventilation system can be downsized.