New report urges stronger codes, deeper retrofits, and rapid digital optimisation; experts say real-time AI control is now essential for cutting energy waste
The International Energy Agency’s Energy Efficiency 2025 report warns that the world is falling far behind its pledge to double annual efficiency gains by 2030. Instead of the required 4% improvement each year, global progress since 2019 has averaged just 1.3%. The IEA identifies the buildings sector—now the largest source of CO₂ emissions—as a key reason for the slowdown.
The report highlights three urgent priorities: strengthening building codes, accelerating retrofit investments, and deploying advanced digital optimisation. Yet industry specialists argue that even these measures will fail without real-time AI systems that can control heating, cooling, and ventilation based on live conditions inside buildings.
“Codes describe how efficiently a building should be designed, but rarely how its systems should operate,” said Donatas Karčiauskas, CEO of Exergio. “Without smart, real-time adjustments to weather, occupancy, and actual loads, even new or renovated buildings will underperform and miss their promised savings.”
According to the IEA, global retrofit spending in China, the US, and the EU was more than 20% higher in 2024 than in 2019, reaching about USD 120 billion. Worldwide end-use efficiency investment is expected to approach USD 800 billion in 2025—70% higher than in 2015. Notably, over 90% of funding comes from households and private investors, leaving limited public backing.
However, experts warn that physical retrofits alone are insufficient. Exergio notes that 20–30% of potential energy savings typically vanish due to poor system operation—equipment running at the wrong times, simultaneous heating and cooling, or floors being conditioned when unoccupied.
The IEA also positions digital optimisation as a central lever for immediate impact, capable of delivering up to 40% energy savings without replacing equipment. Countries including Germany, France, Singapore, Australia, and India already mandate advanced automation systems in commercial buildings.
Karčiauskas believes the next leap will come from AI-driven operational intelligence, which the IEA largely overlooks. Exergio’s AI platform integrates with existing building management systems, reading sensor, occupancy, and tariff data to coordinate HVAC, heat pumps, and major loads for optimal performance.
As global emissions targets tighten, the report’s findings reinforce a critical message: without smarter, automated building operations, efficiency improvements will continue to fall short—regardless of new codes, investments, or materials.