It is debatable whether it is the production or consumption of energy that is the cause of greenhouse gas emissions. It is not debatable, however, that saving energy is a source of potentially significant emissions reduction. Buildings, overall, are a significant source of energy consumption. Approximately a third of global energy consumption is in buildings, making them an obvious target for reduction of demand and, therefore, also carbon emissions. Today, it is possible to construct zero-energy houses, meaning houses that do not consume external energy but generate their own.
Outside of buildings, the public sector is responsible for a number of energy consuming services where there may be significant potentials for reducing power consumption, such as street lighting, traffic lights, water pumping and wastewater treatment.
Linking production and consumption of electricity through electricity distribution systems is also a target for potential savings, as operational losses are often caused by outdated equipment or low voltage transmission. Where there are no transmission grids at all, unconnected rural villages typically operate an isolated grid or even individual power production with diesel generators. Rural electrification projects may replace emission intensive diesel power with less emission intensive power from the grid.
CDM projects are applicable to the following power consuming sectors of the economy:
- Electricity for Grid
- Public Services
- Various Household Installations