Global economic growth has become more energy efficient - and there are further savings to come

Jul 10, 2019

  • New report shows that in the years to 2040 global energy efficiency should continue to improve even as the global economy grows 

  • The UK is among the major economies with much improved energy efficiency. It now takes 72kg of oil equivalent to generate $1000 of GDP, compared with 135kg in 1990

New research from PwC has shown a direct correlation between global economic growth and greater energy efficiency, with significant strides made over the last 30 years. In 1990 it required around 181kg of oil equivalent to produce $1000 of global GDP in purchasing power parity (PPP) terms, but in 2015 it only needed 123kg - an improvement in efficiency of more than one-third.

PwC’s latest Global Economy Watch predicts that the trend will continue and by 2040 global energy intensity will fall by a further one-third, meaning that it will take only 78kg of oil equivalent to generate $1000 of GDP. Simultaneously, however, global GDP will continue to increase.

Mike Jakeman, senior economist at PwC UK, said:

“Becoming more energy efficient is crucial in limiting climate change, while also ensuring that the global economy continues to grow and the world’s population becomes prosperous. This report is a positive story for the global economy, as it suggests that governments and businesses can continue to pursue climate change policies that limit energy consumption without eliminating economic growth.

However, while improved energy efficiency is very encouraging, it's only part of the story and needs to be combined with a continual push to reduce emissions.”

The trend is a result of structural economic change combined with technological progress, the report finds. More economies have moved away from manufacturing and towards services, which are more energy efficient. In the UK, the service sector accounts for around 80% of GDP but only just over half of its energy consumption, while the industrial sector is responsible for around 15% of each. Countries which have seen a large fall in energy intensity have thus seen an increase in the importance of services to their economy.

Progress in technology, such as the advent of smart appliances and increased electrification, has also helped to limit the rise in energy demand while concurrently boosting GDP.

The greatest improvement in reducing energy intensity has occurred in Eastern Europe and Central Asia, with an average fall of 20%, despite many of these being the world’s fastest growing economies since 1990. Economic growth in Eastern Europe has come at the same time as services have swelled as a proportion of GDP by an average of 10-15 percentage points, and as the economies have adopted more energy efficient technology and seen stronger governance.

Ends.

Notes to editors

For more information please visit https://www.pwc.com/gx/en/issues/economy/global-economy-watch.html

  • New report shows that in the years to 2040 global energy efficiency should continue to improve even as the global economy grows 

  • The UK is among the major economies with much improved energy efficiency. It now takes 72kg of oil equivalent to generate $1000 of GDP, compared with 135kg in 1990


New research from PwC has shown a direct correlation between global economic growth and greater energy efficiency, with significant strides made over the last 30 years. In 1990 it required around 181kg of oil equivalent to produce $1000 of global GDP in purchasing power parity (PPP) terms, but in 2015 it only needed 123kg - an improvement in efficiency of more than one-third.

 

PwC’s latest Global Economy Watch predicts that the trend will continue and by 2040 global energy intensity will fall by a further one-third, meaning that it will take only 78kg of oil equivalent to generate $1000 of GDP. Simultaneously, however, global GDP will continue to increase.

 

Mike Jakeman, senior economist at PwC UK, said:

 

Becoming more energy efficient is crucial in limiting climate change, while also ensuring that the global economy continues to grow and the world’s population becomes prosperous. This report is a positive story for the global economy, as it suggests that governments and businesses can continue to pursue climate change policies that limit energy consumption without eliminating economic growth.

 

However, while improved energy efficiency is very encouraging, it's only part of the story and needs to be combined with a continual push to reduce emissions.

 

The trend is a result of structural economic change combined with technological progress, the report finds. More economies have moved away from manufacturing and towards services, which are more energy efficient. In the UK, the service sector accounts for around 80% of GDP but only just over half of its energy consumption, while the industrial sector is responsible for around 15% of each. Countries which have seen a large fall in energy intensity have thus seen an increase in the importance of services to their economy.

 

Progress in technology, such as the advent of smart appliances and increased electrification, has also helped to limit the rise in energy demand while concurrently boosting GDP.

 

The greatest improvement in reducing energy intensity has occurred in Eastern Europe and Central Asia, with an average fall of 20%, despite many of these being the world’s fastest growing economies since 1990. Economic growth in Eastern Europe has come at the same time as services have swelled as a proportion of GDP by an average of 10-15 percentage points, and as the economies have adopted more energy efficient technology and seen stronger governance.

 

Ends.

Notes to editors

For more information please visit https://www.pwc.com/gx/en/issues/economy/global-economy-watch.html

About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 158 countries with more than 250,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

© 2019 PwC. All rights reserved.

Ends.

 
  • New report shows that in the years to 2040 global energy efficiency should continue to improve even as the global economy grows 

  • The UK is among the major economies with much improved energy efficiency. It now takes 72kg of oil equivalent to generate $1000 of GDP, compared with 135kg in 1990


New research from PwC has shown a direct correlation between global economic growth and greater energy efficiency, with significant strides made over the last 30 years. In 1990 it required around 181kg of oil equivalent to produce $1000 of global GDP in purchasing power parity (PPP) terms, but in 2015 it only needed 123kg - an improvement in efficiency of more than one-third.

 

PwC’s latest Global Economy Watch predicts that the trend will continue and by 2040 global energy intensity will fall by a further one-third, meaning that it will take only 78kg of oil equivalent to generate $1000 of GDP. Simultaneously, however, global GDP will continue to increase.

 

Mike Jakeman, senior economist at PwC UK, said:

 

Becoming more energy efficient is crucial in limiting climate change, while also ensuring that the global economy continues to grow and the world’s population becomes prosperous. This report is a positive story for the global economy, as it suggests that governments and businesses can continue to pursue climate change policies that limit energy consumption without eliminating economic growth.

 

However, while improved energy efficiency is very encouraging, it's only part of the story and needs to be combined with a continual push to reduce emissions.

 

The trend is a result of structural economic change combined with technological progress, the report finds. More economies have moved away from manufacturing and towards services, which are more energy efficient. In the UK, the service sector accounts for around 80% of GDP but only just over half of its energy consumption, while the industrial sector is responsible for around 15% of each. Countries which have seen a large fall in energy intensity have thus seen an increase in the importance of services to their economy.

 

Progress in technology, such as the advent of smart appliances and increased electrification, has also helped to limit the rise in energy demand while concurrently boosting GDP.

 

The greatest improvement in reducing energy intensity has occurred in Eastern Europe and Central Asia, with an average fall of 20%, despite many of these being the world’s fastest growing economies since 1990. Economic growth in Eastern Europe has come at the same time as services have swelled as a proportion of GDP by an average of 10-15 percentage points, and as the economies have adopted more energy efficient technology and seen stronger governance.

 

Ends.

Notes to editors

For more information please visit https://www.pwc.com/gx/en/issues/economy/global-economy-watch.html

About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 158 countries with more than 250,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

© 2019 PwC. All rights reserved.

Ends.

 
  • New report shows that in the years to 2040 global energy efficiency should continue to improve even as the global economy grows 

  • The UK is among the major economies with much improved energy efficiency. It now takes 72kg of oil equivalent to generate $1000 of GDP, compared with 135kg in 1990


New research from PwC has shown a direct correlation between global economic growth and greater energy efficiency, with significant strides made over the last 30 years. In 1990 it required around 181kg of oil equivalent to produce $1000 of global GDP in purchasing power parity (PPP) terms, but in 2015 it only needed 123kg - an improvement in efficiency of more than one-third.

 

PwC’s latest Global Economy Watch predicts that the trend will continue and by 2040 global energy intensity will fall by a further one-third, meaning that it will take only 78kg of oil equivalent to generate $1000 of GDP. Simultaneously, however, global GDP will continue to increase.

 

Mike Jakeman, senior economist at PwC UK, said:

 

Becoming more energy efficient is crucial in limiting climate change, while also ensuring that the global economy continues to grow and the world’s population becomes prosperous. This report is a positive story for the global economy, as it suggests that governments and businesses can continue to pursue climate change policies that limit energy consumption without eliminating economic growth.

 

However, while improved energy efficiency is very encouraging, it's only part of the story and needs to be combined with a continual push to reduce emissions.

 

The trend is a result of structural economic change combined with technological progress, the report finds. More economies have moved away from manufacturing and towards services, which are more energy efficient. In the UK, the service sector accounts for around 80% of GDP but only just over half of its energy consumption, while the industrial sector is responsible for around 15% of each. Countries which have seen a large fall in energy intensity have thus seen an increase in the importance of services to their economy.

 

Progress in technology, such as the advent of smart appliances and increased electrification, has also helped to limit the rise in energy demand while concurrently boosting GDP.

 

The greatest improvement in reducing energy intensity has occurred in Eastern Europe and Central Asia, with an average fall of 20%, despite many of these being the world’s fastest growing economies since 1990. Economic growth in Eastern Europe has come at the same time as services have swelled as a proportion of GDP by an average of 10-15 percentage points, and as the economies have adopted more energy efficient technology and seen stronger governance.

 

Ends.

Notes to editors

For more information please visit https://www.pwc.com/gx/en/issues/economy/global-economy-watch.html

About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 158 countries with more than 250,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

© 2019 PwC. All rights reserved.

Ends.

 

About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 158 countries with over 250,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

© 2019 PwC. All rights reserved

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