The Second Wave

Fast-growing emerging markets are making energy efficiency a high priority. Leading the way: China.

After years as energy-efficiency laggards, China and a number of other fast-growing emerging markets are putting a high priority on restraining oil demand.

Stung by high energy costs prior to the world recession, these countries are implementing a host of measures to try to contain energy consumption and damp the impact of future oil-price spikes. Among other things, they’re laying down tough new efficiency standards on everything from cars to buildings to home appliances.

Fatih Birol, chief economist at the Paris-based International Energy Agency, says the developing world may represent a second “wave” to the energy-efficiency boom started the past few years in developed nations like the U.S. “Many emerging markets are starting to realize energy-efficiency measures make sense from the standpoint of energy security, limiting the impact of high oil prices and fighting pollution,” Mr. Birol says.

Of course, even if many of the measures are fully implemented, the energy savings could be more than offset by population growth and fast economic activity as developing markets industrialize. Another potential stumbling block: These nations offer their people large energy-price subsidies to cushion the impact of high prices but that encourage wasteful consumption. Still, if these countries can stick with and extend efficiency programs, their efforts could have big implications for the global oil market