「Synergy Energy Efficiency Index」 Press Conference – Energy Usage in Residential and Commercial Sector has Increased

The World Green Organisation (WGO) announced the ‘Synergy Energy Efficiency Index’ this year to measure and analyse energy use in Hong Kong. It found that despite improvements in energy efficiency, consumptions in energy has increased. Energy consumption per residential household was 4% higher in 2014 than in 2000 (after adjustments for population, weather, and economic growth). Consumption in the commercial sector was found to be 17% higher. For both of these sectors, there was a 7% greater increase than what was calculated in 2013. WGO believes that a major factor of this increase in the residential sector is a result of government electricity subsidies which drove up power usage amongst residents. Another factor is the expansion of private residential estates and their clubhouses which have to operate long hours. Increases in the commercial sector may be related to the growth in data centres. In this day and age, data centres have become one of the largest and fastest consumers of electricity in the modern world. If new energy conservation methods are not developed or strengthened, data centres will consume more electricity than what the power grids can supply.

The ‘Synergy Energy Efficiency Index’ is sponsored by the Synergy Groups Holdings International Ltd. (stock code: 1539) and is the result of a collaboration between WGO and Dr. William Chung Sui-wai, Director of Energy and Environmental Policy Research Unit at the City University of Hong Kong. The index was designed through the use of scientific methods such as the decomposition analysis which takes into account different factors which may affect changes in energy consumption such as type of building (office, retail, or restaurant) or floor area through the years. The index considers these factors in order to calculate difference in energy consumption in 2000 and 2014 for the same activity.

The index uses data from the Electrical and Mechanical Services Department’s Hong Kong Energy End-Use data for year 2000 and analyses factors such as population growth, number of public and private buildings and offices, energy use attitudes, and weather changes that will cause an increase or decrease in energy consumption. By excluding each factor, the index can deduce the Hong Kong people’s attitudes towards energy and estimate what actually causes the energy consumption increase.

Hong Kong’s residential sector energy consumption index was 104% in 2014
The index found that Hong Kong’s residential sector’s index was at 104% [1]in 2014. This is 4% higher than the 2000 energy consumption baseline. In other words, for the same activity, Hong Kong’s residential sector was using 4% more energy in 2014 than in 2000. It is important to note that in 2013, the index found that the residential sectors’ index was 97%. In just one year, the percentage increase 7%. The results were surprising.

According to the statistics, the total energy consumption of the residential sector in 2013 was 59,458 TJ (Terajoule) (approximately 16.5 billion Wh, see table 2) which was 1,429 TJ less than in 2012 [2]. In 2014, the total energy consumption of the residential sector was 62,958 TJ. When compared to the 2013 data, there is a difference of approximately 3,500 TJ. One of the reasons for the increase was probably due to the private housing sector which was accountable for 2,071 TJ of the increase, 60% of the total increase. The public housing sector and government-funded housing were responsible for 747 and 557 TJ of the increase. The former was an increase of over 20% whereas the later was an increase of 16%. If energy use attitudes were taken into consideration, the amount of energy consumed per 1,000 homes, compared to 2000, was -1,525.8 TJ in 2013 (see table 3) and 2,546.36 TJ in 2014(see table 4). The difference between 2013 and 2014 was 4,072.16 TJ in just one year (this is equivalent to 1.4 times the amount of electricity consumed by the MTR Corporation Limited in 2014).

Dr William Chung Sui-wai, Associate Professor at City University analysed, “Government electricity subsidies, added with the increase of electricity consumption in private housing estates have caused energy consumption to increase again in 2014. Private residential estates provide clubhouses and facilities such as swimming pools that require a lot of energy to maintain. ”

Breakdown of electricity consumption in the commercial sector
Despite global awareness of energy conservation, the index showed that the commercial sector’s electricity usage has increased. For 2014, the total energy consumed by the commercial sector was 121,480 TJ. In 2000, the consumption was 94,043 TJ. There was a significant increase of 27,437 TJ. However, a breakdown of energy usage in the different industries of the commercial sector indicated that offices and restaurants actually reduced energy consumption 1,097 and 3,078 TJ respectively (see table 5). Although traditional industries have drastically improved their energy efficiency, ‘retailers’ and ‘others’ [4] increased energy consumption by 1,778 and 29,833 TJ respectively. ‘Retailers’ and ‘others’ increased their usage to a total of 108% [5] which completely offsets the reduction made by offices and restaurants.

In 2013, the index measured energy consumption at 110% compared to 2000. From 2000 to 2013, there was an increase of 10% in energy consumption (an average annual increase of approximately 0.77%). However, from 2013 to 2014, consumption increase 7% which is 9 times more than from 2000 to 2013. Data centres have been found to consume 3% of the global electricity supply. Its carbon emissions account for 2% of all global emissions.

Energy consumption of data centres and IoT
Technological advances has meant that data centres can now operate in room temperature. This means that many new data centres no longer have to use as much electricity in order to cool the server. However, there is still a lot of stored data and many old data centres that require cooling technologies to keep rooms around 10 degrees Celsius. The increasing need for data centres can be attributed to the popularity of online shopping and the development of the ‘Internet of Things’ [6]. Both of which have large number of images and data processing.

The United States Department of Energy published a United States Data Centre Energy Usage report last June which found that in 2014, data centres consumed an estimated 70 billion W/h which represents about 1.8% of total U.S. electricity consumption. The report showed that electricity consumption of data centres increased to 4% from 2010-2014 alone.

Technological developments has allowed people to use their smartphones to go on the internet, check their social media, or shop online anywhere and everywhere they go. This has meant that although technological advances have made the internet much more energy efficient, the popularity and accessibility of the internet is causing usage to increase. This is an example of what is called the ‘Jevons Paradox’; technological progress has increased the efficiency and availability of the resource, however, the rate of consumption of that resource still continues to rise exponentially because of the increasing demand.

Dr William Yu, CEO of WGO said ‘Data centres are currently a time bomb. Online shopping, IoTs, Hong Kong’s investment banks and domestic banks’ switch to the cloud have resulted in an increase of power consumption.”

Synergy Groups Holding International Ltd.’s Chief Operation Officer, Mr Ken Cheng said “In order to improve and ensure optimal energy efficiency, data centres must monitor their power usage effectiveness (PUE) and set up energy saving measures.”

About Us
The World Green Organisation (WGO) is an independent non-governmental organisation concerned with environmental conservation and environmentally related livelihood and economic affairs by proposing an integrated, three-pronged solution that combines social, environmental, and economic aspects, leading to an environmental revolution. Through science-based policy research and community projects, the WGO aims to enhance the quality of the environment, promote a greener economy, and improve people’s livelihoods. In particular, it will focus on the social concerns of underprivileged groups and on the creation of a green economy to help realise its vision of sustainable development. For more information, please visit http://www.thewgo.org/。

The City University of Hong Kong’s Energy and Environmental Policy Research Unit was established in response to the increasing end-use energy consumption as well as the government’s international commitment to reduce energy intensity (like reducing energy intensity by at least 25% by 2030 with 2005 as the base year in joint effort to tackle the climate change reduction in energy intensity in Hong Kong) and tackle issues of climate change. The research unit was developed to study and formulate formulating a comprehensive energy policy that address energy demand and supply, and related issues including transport, environment and technology innovation. A comprehensive energy policy should be able to ensure a safe, secure, reliable and cost effective energy supply under sustainable development environment. However, there is no research centre or unit for energy and environmental policy analysis in Hong Kong to provide a comprehensive research studies for the above mentioned issues. Hence, we establish the Unit to satisfy this need.

Synergy Group Holdings International Ltd. (stock code: 1539) is a leading integrated energy management solutions provider based in Hong Kong. In addition to specialising in different lighting solutions, Synergy Group also trades its lighting products to their customers and provides carbon audition to install the intended lighting products. It offers services to a number of industries and multinational companies to over 20 different countries including Japan, Australia, Malaysia, Indonesia, Singapore, Fiji, etc. Synergy Group has become one of the leading energy management contract providers in Asia and the first ESCO Company listed on the Hong Kong Stock Exchange.

Table (1):Decomposition of Households in the Residential Sector in 2014 (per 1,000 unit)

Table（2）：Breakdown of Total Energy Consumed in the Residential Sector in 2014

Table（3）：Year 2000 and 2014 Difference in Total Energy Effect with Breakdown in the Residential Sector

Table（4）：Year 2000 and 2013 Difference in Total Energy Effect with Breakdown in Residential Sector

Table（5）：Decomposition of Commercial Sector in 2014（per 1000m2）

Table（6）：Breakdown of Total Energy Consumed in the Commercial Sector in 2014

Table（7）：Year 2000 and 2014 Difference in Total Energy Effect with Breakdown in the Commercial Sector

Table（8）：Year 2000 and 2013 Difference in Total Energy Effect with Breakdown in the Commercial Sector

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