Developing countries could decrease their annual energy demand growth by more than half over the next 12 years by opting for a range of measures, including energy-efficient cars and appliances, building insulation and lower-energy-consuming lighting and production technologies, according to the report, published on 29 October.
This would lower energy consumption by 22% compared with the usual figures, "an abatement equivalent to the entire energy consumption of China today," the researchers found.
Developing countries will be responsible for most of the global increase in energy demand by 2020, according to the International Energy Agency, with their share expected to rise from 51% to 60%.
But investing in energy-saving measures would reduce the need for fuel imports and lower the expense of building new energy-supply infrastructure, the report found.
In fact, an annual investment of $90 billion on energy productivity until 2020 would deliver yearly savings of up to $600 billion to consumers and businesses, according to MGI. Without this efficiency gain, twice that amount would have to be spent on expanding existing supply capacity to meet the growing demand, it says.
Moreover, the report reveals that developing countries are at an advantage compared to more advanced economies as they will be building most of their capital stock in the coming years. This presents "a golden opportunity to lock in lower energy consumption and carbon emissions for decades to come," the report notes.
To tap the potential, the MGI report urges policymakers to abolish policy-related disincentives such as energy subsidies, which "tend to reduce energy productivity".
Similarly, the EU has adopted an action plan to cut its energy consumption by 20% by 2020. Energy savings will be achieved through improved energy-efficiency standards on domestic appliances, street lighting, and buildings, among others (See EurActiv LinksDossier).
