The head of Iran’s National Productivity Organization has raised an alarming concern: as of 2022, Iran holds the dubious distinction of having the highest energy consumption intensity in the world. Mirsaman Pishwai, on January 27, attributed this unsettling ranking to a combination of ‘waste of energy and low efficiency.’
Global statistics from the World Bank and the European Union Environmental Agency echo this sentiment, placing Iran at the bottom of the world table concerning energy consumption intensity. This metric, calculated as the ratio between energy consumption and a country’s gross domestic product (GDP), unveils a stark reality for Iran.
Comparatively, despite having a GDP merely one-tenth of Germany’s, Iran consumes as much energy as the economic powerhouse. In contrast, Turkey, with an economy 2.2 times the size of Iran’s, and Saudi Arabia, with a threefold larger economy, both manage to consume less energy than Iran.
Over the past decade, World Bank figures indicate a concerning trend: Iran’s energy consumption has surged by nearly 29%, while Germany and Turkey have seen reductions of about 14%. On a global scale, the intensity of energy consumption has decreased by 11% during the same period.
The figures for 2023 have not yet been released, but the International Energy Agency estimates a 3% growth in Iran’s gas consumption in the preceding year. Iranian authorities’ statements further reveal a significant increase in the consumption of petroleum products, notably gasoline.
The predominant share of Iran’s total energy consumption is attributed to gas, constituting 68%, with over 30% reliant on oil products. Renewable energy sources—hydro, solar, wind, and atomic energy—make up less than 2% of the country’s energy mix.
Contributing to Iran’s high energy consumption intensity is a dual challenge. Firstly, severe energy losses account for a quarter of the energy produced in the country, lost during production, transmission, or conversion to electricity without benefiting any consumer, as estimated by the Majlis Research Center. This concern has also been emphasized by the head of Iran’s National Productivity Organization.
Secondly, the inefficiency of power plants, industries, vehicles, and other major energy-consuming sectors further exacerbates the issue. Lastly, the decline in Iran’s GDP, plummeting from over $640 billion in 2012 to $413 billion in 2022 according to the World Bank, compounds the challenge. With both economic contraction and rising energy consumption, Iran finds itself grappling with an alarming increase in energy consumption intensity.
