Global energy efficiency improvements need to more than triple from 1.7% in 2025 to an annual average of 5.6% through 2030 to meet critical 2030 climate and energy targets, the International Renewable Energy Agency (IRENA) said in a new report.
IRENA’s “Delivering on the UAE Consensus” report, prepared in partnership with the COP31 Presidency and the Global Renewables Alliance, said progress in global energy efficiency remains below the 2030 target.
Global energy efficiency improvement needs to rise from 1.7% in 2025 to an annual average of 5.6%, it said.
The 1.7% improvement in energy intensity recorded in 2025 was below the annual average target of 4% through 2030, requiring an average annual improvement of 5.6% in 2026-2030 to close the gap, IRENA said.
Meeting the target will require faster investment in energy efficiency, particularly in buildings, transport and industry.
Global investment in energy efficiency and savings, which stood at $369 billion in 2025, should rise to an annual average of $3.2 trillion over the 2026–2030 period, it said.
– Electrification key to improving energy efficiency
Direct electrification of end-use sectors is a key driver of energy efficiency gains, according to the report.
Technologies such as electric vehicles and heat pumps operate more efficiently than fossil-fuel alternatives, helping reduce total final energy demand even as electricity consumption rises.
The share of electricity in final energy consumption needs to increase from 23% in 2023 to 30% by 2030.
The COP31 Presidency’s agenda for 2035 includes a target to raise this share to 35%.
The report said accelerating electrification beyond 2030 will be necessary, with the transformation of buildings, industry and transport playing a key role.
By 2030, electricity needs to make up 53% of energy use in buildings, up from 36% in 2023, 31% in industry, up from 27%, and 7% in transport, up from just 1%.
The report highlights electric vehicles, heat pumps and other energy-efficient electric technologies as key tools in this transition.
According to IRENA, electric heat pumps can provide around 300%-400% higher efficiency than conventional boilers, while electric vehicles can be around 60%-80% more efficient than internal combustion engine vehicles.
– EV fleet needs to reach 360 million by 2030
The number of battery electric and plug-in hybrid light-duty passenger vehicles needs to increase from around 57 million in 2024 to 360 million by 2030, according to the report.
This would bring electric vehicles to around 20% of the global vehicle fleet by 2030 and a similar share of transport activity.
IRENA said the transition needs to be supported not only by higher EV sales but also by measures including expanded charging infrastructure, a shift toward public transport and reduced transport demand.
The report also calls for stronger energy efficiency standards, labeling schemes, financial incentives and building renovation policies.
Of the 120 third-generation Nationally Determined Contributions examined in the report, 90%, or 108 countries, refer to energy efficiency, while only 43% set measurable, quantified efficiency targets.
