Energy Efficiency Trends in Asia

Johnson Controls conducts an annual Energy Efficiency Indicator survey that tracks current and planned investments, key drivers, and organizational barriers to improving energy efficiency in facilities. Since the first survey was released in 2007, almost 27,000 energy and facility management leaders have been surveyed. This year marks the 13th edition of the survey with over 1,400 respondents represented from twelve countries, including 400 leaders from China, India, Japan, and Indonesia. The data for the survey was collected in December of 2019. 

Globally, an increasing number of organizations are investing in energy efficiency, renewable energy, and smart building technologies. 62% of organizations reported they are increasing their investments over the next 12 months, which is 3% more than the prior year. In Asia, an average of 58% of organizations expect to increase investment. Organizations in China and Japan exceed both the regional and global average, with 74% and 75%, respectively, planning to increase investment. 

In their investments, organizations are increasingly prioritizing resilience, a trend that predates the COVID-19 pandemic. In APAC, 77% of organizations said resilience is extremely or very important when considering future energy and building infrastructure investments, an increase of 8% since last year. Globally, 80% of respondents responded the same. Distributed energy resource (DER) technologies support facility resilience, and Japan in particular is prioritizing investment in electric energy storage, thermal energy storage, onsite renewable energy, and non-renewable distributed energy generation. On average, 9% more organizations in Japan invested in each listed DER technology compared to the average investment in APAC.

The focus on resilience and distributed energy is reflected in the rise of net zero energy or carbon buildings, as well as those that can operate off the grid. On average, 45% of organizations in APAC reported they are extremely or very likely to have one or more nearly zero, net zero, or positive energy or carbon facilities in the next ten years. Notably, 60% of respondents in China and 58% of respondents in Japan responded this way, exceeding the global average of 51%. 

In comparison, 51% of APAC respondents say it is extremely or very likely their organization will have at least one facility able to operate off the grid in the next ten years. Globally, 54% of respondents say the same. China has the most respondents, 74%, expecting an off-grid facility. 

Overall, in APAC the most important driver in energy and technology investment was attracting and retaining employees, with an average of 70% of APAC respondents saying it was an extremely or very significant factor. This was followed by a tie for the second most important driver, with a regional average of 67% of organizations reporting energy cost savings and improving life safety and security were extremely or very significant factors. 

These drivers are very similar to the top three globally, with energy cost savings being the most significant factor (75% report it to be extremely or very significant), followed by improving life safety and security (71%), with greenhouse gas footprint reduction (70%) the third most significant driver. The chart below shows the top ten drivers regionally compared to the global responses.

Comparatively, the top investment barriers APAC respondents reported include lack of funding to pay for improvements (33%), lack of technical expertise to evaluate or execute projects (18%), and uncertainty regarding savings/performance (18%). Globally, the top three barriers reported are lack of funding to pay for improvements (30%), uncertainty regarding savings/performance (22%). and insufficient payback/ROI (17%). 

Though this survey was completed prior to the rise of COVID-19. we believe that efficiency investments worldwide will continue. When we conducted the survey in 2010, we found that 56% of organizations invested the same or more in the past 12 months (which included the depth of the Great Recession) as they had in previous years. 

During the 2009 recession, investments in efficiency were used to help the economy recover. Efficiency technologies could play an even larger part today in supporting both jobs and healthy buildings as countries look to support public health and the economy. 

Efficiency investments often include co-benefits of improving indoor and outdoor air quality and increasing facility resilience. Facilities face increasing pressure to protect occupant health and safety while adjusting to rapidly changing conditions. For example. buildings may want to monitor indoor air quality metrics or more accurately control the amount of ventilation air supplied. Though some COVID control strategies, such as increased ventilation and filtration, can increase energy use, these modifications can be balanced by efficiency improvements elsewhere in the facility. 

For governments and policymakers interested in increasing investment in resiliency, efficiency, and occupant health and safety, the three most impactful policies include performance benchmarking and certifications, financial incentives and programs, and building energy codes and product energy performance standards. Respectively, 79%, 67%, and 64% of respondents stated that these policies were extremely or very important drivers of investment. Increased collaboration between governments, businesses and institutions can help successfully guide the APAC region through the coronavirus pandemic and economic recovery while improving facility safety, efficiency and resilience along the way.