What is energy efficiency and how does it work?

Energy efficiency is much more than a fad and can help us to protect the environment by generating significant savings

Albert Einstein said that in the universe “everything is energy and that is all there is”. This reflection by the best-known contemporary scientific genius, which we are obviously not going to discuss for obvious reasons, shows us to what extent energy is the fundamental basis of our lives, even though sometimes we are not fully aware of it. Every act we perform in our daily lives is linked to the movement and/or transformation of different types of energy. The heat we need for our bodies to function properly—thermal energy—, the force we use to move from one place to another—mechanical energy—or the electrical energy that lights up our appliances and allows our society to function. In all these examples, there is an associated energy cost depending on a series of conditions; and in all of them, energy efficiency can help us to reduce the cost necessary to carry them out. But how? Well, perhaps first we need to pause for a moment to explain what energy efficiency is.

Let’s see, energy efficiency can be defined as the maximum use or optimisation of a given energy source., whatever its typology. Thus, and by means of a specific methodology adapted to each case, this allows us to implement efficiency and savings mechanisms, so that we can reduce the energy expenditure necessary to carry out a specific task. To all intents and purposes, this means that with the same level of energy consumption we will be able to carry out a series of extra functions. To give an example, if an average household consumes around 270 kilowatts per month, with an energy efficient strategy we could reduce this consumption to 230 kilowatts thanks to the installation of more efficient appliances, the revision of the electrical installation itself to avoid losses or the implementation of complementary renewable generation sources. It’s much clearer now, isn’t it?

Indeed, energy efficiency is one of those measures that is little talked about compared to the enormous potential it has in our society. Think of the millions of buildings and facilities that, because they base their electricity and/or climate supply on obsolete or poorly maintained technologies, waste huge amounts of energy day in and day out. This applies to industrial companies whose installations are far from being optimised in terms of energy or large infrastructures with enormous energy deficiencies. Wasteful, isn’t it? The reality is that we cannot afford this absurd luxury either economically or climatically. These are the two reasons why each and every government is starting to take firm steps to solve a problem that is weighing down economies, eating up countless amounts of resources, and throwing stones on the already stoned roof of the environment.

The application of these energy-saving methodologies allows us to put an end to energy wastage, with a consequent reduction in climate impact. Think of a car with a combustion engine that can run 1,000 km on a single tank instead of 500 km, a home that can be heated with 20% less gas due to efficient thermal insulation, or a metallurgical industry that can manufacture 10 tonnes of steel coils with 30% less electricity. That is real energy efficiency. No more, no less.

Energy efficiency and its role as a competitive factor

If the climate factor is fundamental and also represents a measure to protect our environment and health, the economic factor is undoubtedly equally attractive for investment in energy efficiency. The application of these measures is a competitive factor for the productive and economic fabric of countries. According to macro data, Spain’s electricity consumption in 2022 amounted to 250,421 GW, corresponding to 5,259.3 kW per capita; a per capita consumption higher than that of neighbouring countries such as Italy, Portugal or the United Kingdom, although lower than that of France or Germany, for example.

These data, which in order to offer valid conclusions have to be combined with other factors such as household or industrial consumption, for example, nevertheless help us to understand that the world’s large economies demand large quantities of electricity. This is obvious, since developed societies are much more dependent on electricity than others. But the key lies in the very opportunity that this situation presents. Reducing a country’s energy consumption can have a direct impact on the economy’s GDP, reducing expenditure on energy generation, balancing the economic balance—often dependent on huge expenditure on imported fossil fuels—and diverting this expenditure to other areas such as health, research, financing of the productive fabric, etc. If we transfer this concept from the public to the private level, we obtain an equation in which a 15% saving—let’s put a figure at random—in the energy expenditure of an electricity-intensive company can be a real boost to the company’s operating margin. In other words, more efficient energy spending makes economies more competitive. Given the global dimension of the economy and markets, competitiveness is not an option, but a strategic necessity, and this is where energy efficiency has so much to contribute. In this respect, it should be borne in mind that the potential for savings depends on several factors: type of equipment, age, use, energy prices, etc.

Energy Saving Measures as a lever for change

But of course, it is easy to say that we want to reduce energy costs – who would object to that? The real question is: how can energy savings be promoted in a company? The key lies in the application of energy saving measures (ESMs). These are a series of actions that are implemented depending on the type of company in order to generate marginal gains and reductions in consumption. To do this, first of all, it is necessary to analyse, from a technical point of view, which are the energy consumption points of an installation, check the quality of the installation itself, analyse the type of energy consumed, the bills… Once this has been done, it is time to locate the points with potential improvements and draw up a strategy for ESMs adapted to the reality of the company. For example, if our company is a metallurgical company, we may need heat recovery systems, the replacement of process boilers with more efficient ones or the renovation of compressed air installations. All of this requires an initial investment that must be backed up by a financial plan that optimises its long-term amortisation; in addition to having a system for measuring consumption that provides us with statistics on the improvement of the measures applied. In other words, the equation consists of analysing, measuring, establishing a strategy, applying energy saving measures, measuring and analysing again.

This is why specialised companies such as Stratenergy, energy efficiency experts who accompany their clients as a key partner in the process, are key to achieving energy savings for companies in different sectors.

It is now much clearer to you what energy efficiency is and why it is key.