IBC members have identified the following as the three most important government actions: i. Setting incentives for energy efficiency interventions, particularly for SMEs. ii. Providing minimum energy efficiency standards (including energy performance standards). iii. Conveying sector-specific targets and ambitions. Governments should also focus on driving progress in specific sectors including building, transport and industry,11 which together constitute nearly 94% of energy use. Table 2 contains a full list of policy enablers recommended by IBC members. It is important to note that this should be seen as a menu of options and each country will need to find the options best suited to its context and tailor them to its situation. Each country will need its own energy transition plan, to allow stakeholders to make investment decisions appropriate to their local context. Key policy elements of a national plan Lead Convey a clear ambition, path and targets for energy intensity for key sectors (e.g. buildings, industry and transport), prioritizing market-based and technology-neutral approaches to reach these targets. Ensure centralized coordination on the energy efficiency agenda that cuts across sectors, including but not limited to ensuring that the grid has sufficient capacity for the electrification of the key sectors. Develop implementation pathways for digital technologies that help companies better manage demand and collaborate with the grid, including policy frameworks, interoperability, data management and cyber resilience. Ensure energy security for all stakeholders, by improving grid resilience and creating an adequate framework around grid strengthening, market design and pricing mechanisms. Publish national benchmarks for efficiency in buildings, industry and transport to increase transparency, and integrate these into national planning and policy-making. Showing best practices will highlight underperformance, increase awareness and knowledge sharing, and drive action. Engage with municipalities to localize demand planning and build-in spatial energy planning (e.g. through industrial clusters). Engage with businesses to co-develop policies and solutions. This can include catalysing investment for industrial hubs, ensuring demand through innovative offtake or procurement schemes, or gathering information on emerging risks and opportunities (e.g. collecting risk data from insurance companies). Support training and skill-building for energy efficiency-related service providers in order to create green jobs. Lead by example (e.g. using government procurement as a lever, promoting efficiency in government buildings). Inform Establish standardized energy efficiency metrics for different industries and make data transparent to enable benchmarking and establishment of expected and delivered savings. Promote energy efficiency across the entire value chain; this includes designing products with lower material needs, enhancing circularity, streamlining transport, and reducing waste – broadening impact beyond traditional energy efficiency measures. Focus on improving awareness and performance of energy demand in industry and society, including through life- cycle analysis approaches. Promote simplicity of regulation and messaging to encourage action. Build case studies and create a centralized repository; promote campaigns to drive awareness, including of case studies geared for EMDEs or SMEs. Promote national and community-based awareness campaigns. Ensure existing Labour Market Information about Green Jobs, Skills and Wages is properly distributed.Energy transition planning: What governments can do TABLE 2Delivering this kind of change will require assured, trustworthy measurement of metrics tied to overall targets. IBC members therefore also highlight the need to ensure that GHG and energy measurement and intensity is as accurate as possible in order to identify the best options to drive change.Another useful market-based tool governments could implement is demand-side bidding, in which regulators set energy efficiency targets and utilities invite firms to bid in their demand reduction schemes and pricing. Transforming Energy Demand: Accelerating Business Action through Government Leadership 8

Transforming Energy Demand 2025