Example
Insulation can reduce the energy needed to maintain an indoor temperature.
The catch
Compare equivalent services and account for actual use.
Related terms
Electrification, Energy conservation, Energy storage, Fossil fuel, Heat pump, Renewable energy
In more depth
Energy efficiency, explained.
The IEA calls energy efficiency the first fuel, because the energy a society never needs is often the cheapest and cleanest supply it has. EU law turns that idea into the energy efficiency first principle, which asks decision-makers to weigh demand-side savings before building new supply. Efficiency also lowers peak demand, which makes electrification easier on the grid.
Many savings stay on the table because of split incentives. A landlord pays for insulation while the tenant enjoys lower bills, so neither acts alone. Expect some rebound effect too, as cheaper running costs invite more use, so measured savings often fall short of engineering estimates.