Wasted energy How US can reach its energy potential

Wasted energy: How the US can reach its energy productivity potential

By Florian Bressand, Diana Farrell, Pedro Haas, Fabrice Morin, Scott Nyquist, Jaana Remes, Jaeson Rosenfeld, Matt Rogers
Wasted energy: How the US can reach its energy productivity potential

By capturing the potential available from existing technologies, the United States could cap US energy consumption, as well as its greenhouse gas emissions, at today's levels.

The United States is the single biggest energy consumer in the world, even before accounting for the energy used in producing US imports.

One of the main reasons behind high US energy consumption is that the country has the lowest energy productivity—or the level of output that the United States achieves from the energy it consumes—of any developed economy. Each person in the United States today consumes the equivalent of almost seven gallons of oil—80 percent more energy than Northwestern Europe, 94 percent more than Japan, and seven times the level of China. As a result, the United States is also the most CO2-intensive country, producing 19 tons of CO2 per capita annually—more than twice the level of Northwestern Europe and Japan.

Almost two-thirds of US energy usage today comes from consumer-driven industries, dominated mainly by road transportation and residential energy consumption. Within industrial energy demand, which accounts for 35 percent of total US energy demand, chemicals is the largest sector, with 9 percent of total industrial energy usage. The rest is fragmented across diverse sectors such as steel, apparel, and food processing.

If there is no change to current policies, US energy demand will accelerate slightly from its long-term growth rate to some 1.1 percent a year. Yet MGI research finds that a concerted effort to boost US energy productivity—or the level of output that the United States achieves from the energy it consumes—would have spectacular results. By capturing the potential available from existing technologies with an internal rate of return of 10 percent or more, the United States has the potential to cap its energy demand, as well as its greenhouse-gas emissions, at today's levels. What's more, an intensive focus on improving energy productivity would spur new markets for demand-side innovation and thus represents an important business opportunity for manufacturers, utilities, and other companies.

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