General Information

What does "energy efficiency" mean?

Hand hält Wärmebild vor einem Haus

A warm living room in winter or a sports stadium brightly illuminated at night – we use energy to achieve a specific benefit. Energy efficiency is a means of measuring the energy-expenditure required to achieve a certain benefit. The lower the losses in energy to achieve a specific purpose are, the higher is the degree of energy efficiency.

Why do we need more energy efficiency?

Energy demand is increasing worldwide. The energy market situation is heating up and energy prices are on the rise. Instabilities in many exporting and transit countries are a cause for concern and the increased combustion of fossil energy sources is accelerating climate change. An expansion of energy supply options is costly and will take time. On the other hand, increasing energy efficiency curbs energy prices, reduces dependency on energy imports, counteracts energy distribution conflicts and cuts climate-damaging carbon dioxide emissions.


  • The reduction target for primary energy consumption is 20 percent by 2020 and 50 percent by 2050
  • and for electricity consumption it is 10 percent by 2020 and 25 percent by 2050.
  • In the buildings sector the target are as follows: 20 percent more energy savings for heat by 2020, by 2050 an 80 percent reduction in primary energy consumption, a near climate-neutral building stock and a doubling of the energy-related modernisation rate to two percent annually.
  • In energy productivity the aim is an average increase rate of 2.1 percent up to 2050.

The German Government's policy

In energy savings and energy efficiency Germany is following a three-tiered approach consisting of requirements, support and information. The buildings sector is responsible for 40 percent of primary energy consumption in Germany and for approximately 33 percent of CO2 emissions. 75 percent of buildings in Germany were erected before 1979, i.e. before the First Thermal Insulation Ordinance entered into force. The Federal Government will gradually raise minimum efficiency standards and introduce a long-term modernisation road map for existing buildings in order to meet the targets in the building sector. This will be achieved by further developing regulatory provisions (amendment of the Energy Saving Ordinance in 2013) and by considerably stepping up economic incentives for energy related refurbishment of buildings. Funds for the CO2 building modernisation programme were stocked up to a volume of 1.8 billion euros for the 2012 to 2014 period.

Efficient electricity use

Measures to save electricity take the lion’s share of in primary energy savings due to their high primary energy factor of 2.5. Since 1990 electricity consumption has been distinctly decoupled from economic development (as a result of increasing energy productivity). Several surveys have confirmed that economic electricity savings potential in the sectors of households, commerce, trade, services and industry ranges from 80 to 110 TWh (terawatt hours) which corresponds to approximately 20 percent of Germany's net electricity demand. A wide range of European and domestic measures to improve efficiency in electricity consumption is already available. The new EU Energy Efficiency Directive specifies comprehensive electricity savings requirements covering the entire energy chain. The Directive aims to make an EU-wide primary energy saving of 20 percent by 2020. The final energy saving, for instance, must be 1.5 percent to achieve this target. The Directive entered into force in October 2012 and has to be transposed into domestic law within 18 months.

It incorporates the former EU Energy End Use Efficiency and Energy Services Directive and the Cogeneration Directive.

On a domestic scale, projects under the Energy Efficiency Fund and the National Climate Initiative will play an important role in achieveing these targets. Regulatory provisions for refrigeration equipment were, for example, initiated under the National Climate Initiative.


The European single market requires energy-related products to be regulated at EU level. Measures such as limiting the energy consumption of these products and product labelling are laid down in the Ecodesign Directive and the Energy Labelling Regulation. The EU Energy Labelling Regulation replaced the Energy Labelling Directive in the summer of 2017. EU regulations adopted under the two directives take immediate effect in the member states. Currently, there are 28 regulations under the Ecodesign Directive, 16 regulations under the Energy Labelling Directive and 3 recognised voluntary agreements for the purpose of regulating individual energy-related product groups. The Ecodesign Directive and the Energy Labelling Directive help achieve roughly 50 percent of Europe’s 2020 energy saving targets. The existing regulations ensure savings of 175 million tonnes of crude oil equivalent, more than the annual primary energy consumption of Italy. For consumers, this means an annual saving of 490 euros per household on energy bills. The European Commission adopted a new working plan with the aim of regulating ten new product groups and revising regulations on 22 product groups under the Ecodesign Directive by 2019. These new measures are expected to deliver additional savings of 50 million tonnes of crude oil equivalent by 2030.

Industry and trade

These sectors are estimated to have an energy savings potential of up to 40 percent. A whole range of federal government measures is therefore targeted at these sectors (processes and buildings). Under the Climate Initiative and the Environmental Innovation Programme, the federal government supports a number of projects geared towards these sectors. These include, for instance, energy-related networks such as the so-called "energy round tables" and a pilot project for the introduction of energy management systems in companies. The Federal Environment Ministry, the Federal Economics Ministry, the Association of German Chambers of Commerce and Industry (DIHK) and the German Federation of Skilled Crafts (ZDH) launched an SME Initiative to boost the transformation of Germany's energy system ("Mittelstandsinitiative Energiewende"), which was specifically tailored to acomodate small and medium-sized enterprises. Within the framework of the initiative, SMEs are provided with information and advice on how they can reduce their energy consumption and costs using efficiency measures. Furthermore, the Deutsche Energie-Agentur (dena - German Energy Agency) supports the dissemination of information on energy efficiency topics directed at both private households and enterprises.

Private Households

Electricity consumption in private households amounts to 140 TWh (2011 figures). This equates to more than 25 percent of the electricity generated in Germany. The energy savings potential in industry is 40 TWh. Private households could rid themselves to a considerable degree of unnecessary energy costs. The average savings potential amounts to approximately 1500 kWh per household. This corresponds to an annual saving in electricity costs of more than 350 euro. 

In the course of the second Round Table with major civil society representatives, Federal Environment Minister Altmaier launched a "power savings initiative" for private households. The initiative brings a number of individual initiatives and activities connected to electricity consulting together and places them under one roof. The centre piece of the internet platform is the "PowerCheck".

Within the framework of the National Climate Initiative, the Federal Environment Ministry has supported a "PowerCheck for low-income households" since 2008 and since 2004 has supported the campaign of the co2online company entitled "Climate seeks protection". Other projects supported by the Federal Environment Ministry such as the heating reviews (Heizspiegel) or the energy savings account (Energiesparkonto) also help to raise awareness and reduce energy consumption. Efficiency improvements in the field of energy consumption present the largest leverage factor and from a facts-based perspective is also the most effective.

Combined heat and power generation (CHP)

The amendment of the Combined Heat and Power Act (KWKG), which entered into force on 1 January 2009, considerably extended the support framework, e.g. by incorporating the use of home-generated electricity and the support for heating networks. In summer 2011 investment security was drastically improved with the extension of support for the operation of CHP units was extended from 2016 to 2020 with a uniform support duration for 30,000 full-load operational hours. The most recent amendment to the Combined Heat and Power Act of 12 July 2012 catered to the new role of Co-generation which foresees an integration of fluctuating renewable energy sources into the system through support for heat and cold storage facilities. This considerably improved support for CHP units and heating and cooling networks. The law is flanked by a reintroduction of the CHP support system for small units of up to 20kW under the National Climate Initiative.

Consumer information

Every one of us can quite easily contribute to increasing energy efficiency: Consumers can help protect the Earth's atmosphere by using energy–saving light bulbs and efficient electrical devices without standby mode, or by improving the thermal insulation of their homes. This also saves money: According to studies by the European Commission an average household can save between 200 and 1000 euro per year by improving its energy efficiency.