WASHINGTON, June 18, 2025-Harnessing the vast, untapped potential of energy efficiency in developing countries is a game-changer that can fast-track affordable and secure energy, drive stronger economies, and create more jobs, according to a new World Bank report released today. It finds that for every dollar invested, energy efficiency can yield $3 to $5 in returns.
Power More with Less: Scaling up Energy Efficiency for Growth and Energy Security makes the case for governments to place energy efficiency at the heart of energy policy and planning. It notes that energy efficiency can deliver many socio-economic benefits, including reduced energy poverty and government spending, enhanced resilience, and lower pollution.
Energy Efficiency can cut future energy supply investments significantly-up to $11.6 billion in power savings for a typical middle-income country by 2050. It can also boost competitiveness and create jobs. In 2022, it was the biggest source of jobs across the energy sector, employing almost 11 million people worldwide-ranging from manufacturing and construction to installation and support services.
"Energy efficiency is no longer optional-it is a necessity for countries seeking affordable and reliable energy for their people, while driving economic growth and creating jobs," said Guangzhe Chen, World Bank Vice President for Infrastructure. "Our new report showcases successful national approaches and offers a roadmap to help develop effective large-scale programs to unlock the vast potential of energy efficiency."
As nearly two-thirds of the world's primary energy is wasted, the report urges governments, financial institutions, and the private sector to prioritize energy efficiency and shift from small-scale pilots and projects to national programs across all users-in public facilities, households, and industry. These efforts will help countries manage rising power demand, prevent overspending on new energy infrastructure, cut fuel imports, and reduce future debt in their energy sectors. However, energy efficiency accounts for only a fraction of energy investments in emerging economies. Political will and supportive policies are in short supply, and inadequate financing and unreliable information also hinder progress. Low-income and lower-middle-income countries face the most acute barriers due to high capital costs and limited access to financing, making it harder for them to invest in energy efficiency.
The report highlights that unlocking the full potential of energy efficiency will require a concerted effort by governments, partners, and the private sector. It emphasizes that multilateral development banks, donor partners, and client countries must work together to ensure energy efficiency is prioritized by government policies and strengthened institutions. Technical assistance and financing can support countries to, over time, transition their smaller-scale projects to national programs. These efforts will send a powerful signal to the market, which can, in turn, bring in new suppliers and competition, thereby driving down prices for all consumers and mobilizing commercial financing.
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Website: www.worldbank.org/energy
X (Twitter): @WBG_Energy
