November 2011: The International Energy Agency (IEA), in collaboration with the Institute of Industrial Productivity (IIP), has published a new paper titled “The Boardroom Perspective: How Does Energy Efficiency Policy Influence Decision Making in Industry?” which investigates what drives decision makers in large, industrial companies to invest in energy efficiency measures.

The paper finds that rationales for investing in energy efficiency to reduce energy consumption vary widely and depend on a variety of factors, including: return on investment; market conditions; sector; company size; energy intensity; cost of energy relative to production costs; whether benefits are the result of purposeful efficiency upgrading or are connected to other upgrades; the financial state of the company; the status of its respective sector; and access to finance.

It finds that despite their cost saving potentials, energy efficiency investments have been slow to materialize due to a number of barriers, including: insufficient information; competing internal priorities; and a lack of viable financing options. The paper concludes that policies can play an important role in addressing these barriers.

The paper also introduces a methodology for evaluating the effectiveness of energy efficiency and climate policy mixes. [Publication: The Boardroom Perspective: How Does Energy Efficiency Policy Influence Decision Making in Industry?]