What is the “Energy Efficiency Gap” phenomenon?



  1. 0 Votes

    The energy efficiency gap is the difference between actual and optimal energy use.  Cost effective energy efficiency is wasted because of market barriers that do not allow a country or area to achieve optimal efficiency.  These market barriers include inadequate access to capital, isolation from price signals, information asymmetry, and split-incentives.

  2. 0 Votes

    The energy efficiency gap seems to refer to several things, but the International Energy Agency calls the energy efficiency gap the difference between actual usage and optimal usage of energy. The organization says that market barriers like a lack of capital, among other things, prevent countries from reaching the optimal level of energy usage, making their energy usage very inefficient. The gap can also refer to a city or company’s investment in energy efficiency as compared to the actual market rate of borrowing.

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