A PwC analysis shows that economically viable efficiency measures in industry often fail not because of missing technology, but due to structural conditions, incentive problems, and uncertainty. Although using energy sparingly and efficiently should be part of the basic economic mindset of industrial companies, significant potential remains untapped. Technical solutions are available and, given high energy costs, are often financially attractive. Nevertheless, many companies remain cautious about investing.
The new short study by PwC, commissioned by the German Industry Initiative for Energy Efficiency (DENEFF), makes clear that incorrect incentives, political uncertainty, and internal decision-making logics are the main barriers to investment. Even highly profitable measures frequently go unrealized because short-term investment criteria dominate, responsibilities are unclear, or planning security is lacking. In addition, the currently unfavorable electricity-to-gas price ratio hampers the electrification of process heat. Uncertainty about future energy price developments and regulatory frameworks further increases the perceived investment risk for new technologies. Another typical organizational issue arises when those who decide on investments are not the ones who later benefit from the savings.
“Using energy more sparingly and thus more productively pays off, but is often systematically held back,” says Christian Noll, Managing Director of DENEFF. “This is not a technology problem, but a structural problem. Anyone who takes competitiveness and industrial transformation seriously must change the investment logic.”
Five Key Areas for Action
The study identifies five areas in which particularly large economic efficiency potentials remain unused.
Industrial Heat Pumps
Industrial heat pumps can raise previously unused waste heat to temperature levels suitable for production processes and can, for example, replace fossil-based steam generation. In practice, however, their deployment is often hindered by high electricity costs and missing grid connections.
High-Temperature Thermal Storage
High-temperature thermal storage systems enable companies to absorb energy when it is inexpensive or readily available and to supply heat precisely when production requires it. Despite this advantage, they are still rarely used because regulatory hurdles and current price structures reduce their economic attractiveness.
Waste Heat Recovery and Internal Networks
In many plants, waste heat continues to dissipate unused because the necessary infrastructure is either insufficiently supported or considered only as a standalone measure. Internal heat networks could systematically tap this waste heat and deliver substantial long-term savings.
Energy Management and User Behavior
Measures such as monitoring, intelligent control, and trained user behavior are among the most cost-effective and fastest-acting efficiency levers. Nevertheless, they are often neglected in day-to-day operations due to a lack of attention, clear responsibilities, and consistent implementation. The energy management systems mandated by the Energy Efficiency Act provide the essential foundation for this.
Technical Insulation
There is also untapped potential in technical insulation. Although insulation measures are technically mature, comparatively inexpensive, and quickly effective, they are often internally regarded as lower priority or “cumbersome.” As a result, avoidable heat losses persist.
Clear Implementation Gap
According to the study, the implementation gap is particularly evident in simple measures such as insulating pipelines, recovering waste heat, or consistently applying energy management. This is striking because these measures require only modest investment and usually have short payback periods.
“Energy Efficiency First” as a Guiding Principle
The authors therefore emphasize the principle of “Energy Efficiency First.” Companies should reduce their energy demand before building new generation or supply solutions. Energy efficiency is not a side aspect of the industrial transformation but its fundamental prerequisite. Every kilowatt-hour not consumed lowers costs, reduces risks, and facilitates the transformation of industrial processes. Reliable political framework conditions and effective energy management systems that create transparency on consumption and savings potential are essential for this.
“Energy efficiency is the fundamental lever for the economic success of the transformation toward a resilient industry,” Noll concludes. DENEFF therefore warns against weakening the Energy Efficiency Act, which only came into force a few years ago. A draft leaked late last year has already caused significant uncertainty and further investment restraint. “Anyone who dilutes established standards and requirements delays investments — and weakens the industrial location,” Noll cautions.
The full German study is available for download here: https://deneff.org/wp-content/uploads/2026/02/20260203_DENEFF_Kurzstudie-Prozesswaerme-in-der-Industrie_Investitionsentscheidungen-verstehen.pdf
