Efficiency Becomes the World’s ‘First Fuel’ as Leaders at IEA Conference Chart Course for Cleaner, More Secure Energy Future

By Umar Manzoor Shah
SRINAGAR, India, Jul 20 2026 – As geopolitical tensions, rising electricity demand and climate pressures reshape the global energy landscape, more than 600 energy ministers, chief executives, financial leaders and policy experts gathered in Montreal, deliberating upon how to deliver at an unprecedented scale.

The 11th Annual Global Conference on Energy Efficiency, organised by the International Energy Agency (IEA) on July 7, focused on transforming a global commitment into practical action. Delegates sought ways to meet an ambitious international target of doubling the annual rate of energy efficiency improvements by 2030, a goal widely viewed as essential for strengthening energy security while cutting greenhouse gas emissions.

Speaking during the conference, IEA Executive Director Fatih Birol described energy efficiency as the world’s “first fuel”, calling it the fastest, cheapest and cleanest resource available to countries seeking greater resilience amid growing uncertainty.

Birol reminded delegates that the global energy system has experienced only three major disruptions in recent decades. The oil crises of 1973 and 1979 fundamentally reshaped global energy policy. More recently, the supply chain disruptions following Russia’s invasion of Ukraine exposed the vulnerability of international energy markets.

Against that backdrop, he argued, improving efficiency is no longer simply an environmental objective but a matter of national security and economic stability. Growing geopolitical risks around strategic shipping routes, including the Strait of Hormuz, reinforce the urgency of reducing dependence on volatile energy supplies.

“We are in an age of rapid technological change,” Birol said, urging governments and industries to move beyond declarations and begin implementing large-scale solutions.

Throughout the two-day conference, participants repeatedly emphasised that technology alone will not deliver the transformation. Success, they said, depends on closer cooperation between governments, investors and private industry.

One of the conference’s central outcomes was the launch of the Montreal Collaboration Framework, an initiative designed to strengthen coordination between policymakers, financial institutions and businesses. The framework aims to overcome one of the biggest barriers facing energy efficiency projects, fragmented decision-making that often prevents otherwise viable investments from moving forward.

Executives participating in CEO roundtables acknowledged that many companies continue to pursue isolated efficiency upgrades that deliver only modest savings. Such projects frequently fail to attract significant investment because their financial returns appear too limited when evaluated individually.

Industry leaders instead advocated bundling multiple efficiency improvements into larger investment packages.

Rather than replacing a single motor or upgrading one heating system, companies can combine electricity savings, industrial heat recovery, cooling improvements and digital monitoring into integrated projects that generate stronger financial returns and attract institutional financing.

Another recurring theme was the growing importance of data.

Representatives from major industrial technology companies including Schneider Electric and Danfoss argued that many businesses still rely on broad estimates of their energy consumption instead of detailed operational information.

Without precise data, they warned, companies struggle to identify where the greatest efficiency gains can be achieved.

Delegates highlighted artificial intelligence, predictive analytics and digital monitoring systems as increasingly important tools for optimising industrial operations, reducing waste and lowering operating costs.

Representatives from Deutsche Bank argued that traditional investment decisions remain too heavily focused on initial capital expenditure. Instead, investors should assess projects through the lens of total cost of ownership, accounting for decades of lower energy bills, maintenance savings and reduced operational risks.

Such an approach, participants said, makes many efficiency investments substantially more attractive than they initially appear.

The conference also examined one of the energy transition’s newest challenges.

Rapid growth in artificial intelligence and digital services is driving an unprecedented expansion of data centres, creating soaring electricity demand worldwide.

Rather than viewing AI solely as a source of higher consumption, delegates argued that technological innovation can help solve its own energy challenge.

Companies showcased advanced cooling technologies, including liquid cooling and evaporative systems, capable of dramatically reducing the electricity needed to maintain modern data centres.

These innovations, participants said, demonstrate that rising digital demand does not necessarily have to translate into proportionally higher energy consumption.

Beyond technology and finance, speakers repeatedly stressed that energy efficiency must also serve broader social goals.

Yasmin Abraham, representing the Kambo Energy Group, reminded delegates that low-income communities often experience the highest energy costs while having the fewest resources to improve efficiency.

“Communities know the challenge,” she said. “Communities are closest to that challenge but furthest from the resources.”

Governments, she argued, must ensure that efficiency programmes reach vulnerable households rather than benefiting only wealthier consumers and large corporations.

Canada used the conference to announce an expansion of its Canada Greener Homes Affordability Program, which will provide energy efficiency retrofits to approximately 35,000 low- and middle-income households without upfront costs.

Officials described the initiative as an example of how public policy can reduce emissions while improving affordability and living conditions for ordinary families.

Despite widespread optimism, delegates acknowledged that achieving the 2030 efficiency target remains a formidable challenge.

Global energy demand continues to grow as economies expand, industries electrify and artificial intelligence accelerates electricity consumption. Meeting climate commitments while ensuring affordable and reliable energy will require unprecedented coordination across governments, financial institutions and private industry.

Still, the prevailing mood in Montreal remained pragmatic rather than pessimistic.

Participants agreed that the technical solutions largely exist. What has often been missing is coordinated implementation, sufficient investment and political determination.

By the conference’s conclusion, delegates appeared united around a common conviction that energy efficiency should no longer be treated as a secondary climate policy but as the foundation of future energy systems.

“With the launch of the Montreal Collaboration Framework and renewed commitments from governments, industry and financial institutions, the conference sought to transform efficiency from an often overlooked policy objective into the central pillar of global energy security, economic competitiveness and climate action,” Abraham said.

IPS UN Bureau Report

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