Policies for energy conservation and sufficiency: Review of existing policies and recommendations for new and effective policies in OECD countries

There is a strong consent among scholars and policy makers that limiting current global energy demand and gradually reducing it towards a sustainable level of consumption is a key component of any strategies and pathways to reach the Paris Agreement climate target, and, in particular, carbon neutrality by mid-century. Given the stringency and urgency of the climate target and the current global increase of energy demand, in addition to investments in energy efficiency technologies, there is the need for a change of energy end-users behaviour and life style to obtain additional energy savings by limiting the demand for services. Traditionally, energy efficiency policies have mainly targeted and promoted energy efficient technologies (e.g., energy performance standards for vehicles, appliances and buildings, financial incentives for new technologies, etc.). In some cases, the energy savings achieved have been less than expected, due to a rebound effect, or because external factors (e.g., growth in populations or economies) have increased energy consumption. The “traditional” energy efficiency policies are still very necessary, but are not sufficient for reaching the Paris Agreement target and the rapid reduction of the energy demand. Policies focusing on energy conservation and sufficiency principles complement efficiency policies, in particular those aiming at changing end-user consumer behaviour and lifestyle by imposing some limitation to the demand for energy services. The article first reviews the concept of energy savings compared to energy efficiency and introduce the concept of energy sufficiency. Then the article explores and discusses some existing and new policy instruments that can address energy conservation and sufficiency such as: personal carbon allowances; energy/carbon taxation; progressive appliance and vehicles standards, and progressive building codes. The article’s focus is mainly on individual end-users and on residential buildings. Finally, the article provides an ex-ante assessment of the policies analysed, including their limitations, and offers some policy recommendations, based on a combination of instruments.