Market Leadership by Example: Government Sector Energy Efficiency in Developing Countries1

Government facilities and services are often a country’s largest energy users, and major purchasers of energy-using equipment. In developing as well as industrial countries, government “leadership by example ” can be a powerful force to shift the market toward energy efficiency, complementing other elements of a national energy efficiency strategy. Benefits from more efficient energy management in government facilities and operations include lower energy bills, reduced greenhouse gas emissions, less demand on electric utility systems, and reduced dependence on imported oil. Even more significantly, the government sector’s buying power and example to others can generate broader demand for energy-efficient products and services, creating entry markets for domestic suppliers and stimulating competition in providing high-efficiency products and services. Despite these benefits, government sector actions have often lagged behind other energy efficiency policies. This is especially true in developing countries and transition economies – with a few exceptions discussed in this paper – even though the public sector share of total energy use in these countries may be at least as large as that in industrial economies. This paper summarizes work in progress to inventory current programs and policies for government sector energy efficiency in developing countries. We describe successful case studies from Mexico’s implementation of public sector energy management, as a possible model for other developing countries. We describe how these policies, starting at the federal level, are now being extended to state and local agencies in Mexico