A 0.2% motor efficiency rise could deliver savings of $12bn for industry
31 May 2026 
A 0.2% improvement in the efficiency of large synchronous motors and generators could deliver electricity cost savings of $9.5–12bn and avoid 60–75 million tonnes of CO₂ emissions over the 25-year life of the machines, according to a new report from ABB. The 21-page report, called The Industrial Efficiency Gap, argues that high-efficiency industrial motors and generators could unlock one of the largest untapped opportunities to save energy, cutting costs and reducing emissions for industrial users around the world.
Analysing data from more than 1,000 large synchronous motors and generators that ABB produced at its Västerås factory in Sweden between 2015 and 2025, the report finds that a significant efficiency gap persists between what most users routinely specify, and what is achievable by adopting the company’s Top Industrial Efficiency (TIE) approach, which specifies the highest efficiency motors or generators using proven commercially available technologies.
Motors rated above 375kW currently account for around 10.4% of global electricity demand – a figure that is expected to double by 2040. By improving efficiency levels across the global installed base of such equipment by just 0.2%, the machines’ operators would be able to save $12bn in electricity costs over 25 years, with typical paybacks ranging from a few months to three years.
“Industry has spent decades optimising what happens inside plants,” points out David Bjerhag, who manages ABB’s global high-speed synchronous machines business. “Yet large motors and generators have rarely been part of that conversation, even though they run continuously for 25 years and sometimes even more, converting more energy to motion than almost anything else on site.
“The gap between a standard machine and a TIE-optimised one is not technological,” he adds. “It is a specification gap. The companies closing it fastest are the ones where the engineer who selects the motor, and the CFO or CSO responsible for energy performance, are aligned around a single metric – total cost of ownership.”
The TIE initiative is a contractual commitment for ABB to deliver large synchronous motors and generators with the highest possible energy efficiency, without compromising reliability or specification compliance. It results in systems optimised for lifecycle performance rather than upfront cost.
Last year ABB announced that a 5MW TIE-optimised synchronous motor for a steel plant in India had achieved an efficiency of 99.13%, setting a new world record. Over its lifetime, this machine is expected to save $5.9m in electricity costs and avoid 45,000 tonnes of CO₂ emissions, with a payback period of just over three months, even in a relatively low electricity cost environment.
The report examines adoption trends by country and industry segment, showing how uptake varies across regions and applications. On average, the TIE option delivers efficiencies of 98.7-98.8% compared with the standard level of 98.5% – a 0.2% improvement. Gains of 1–1.5% are achievable in some applications, particularly those using induction-based systems.
The sectors with the biggest take-up of TIE machines are air separation and chemicals, where 85% of motor orders comply with the recommendations (and where the motor users who pay the running costs tend to be the motor specifiers as well). By contrast, just 10% of order from the oil and gas sector, and 15% of those for power generation applications comply.
Applying the 0.2% efficiency improvement across the global installed base of industrial motors and generators would save 4–6TWh per year – enough to power between 750,000 and 1 million homes in OECD countries. Over the 25-year lifespan of a motor, that accumulates to 100–150TWh of electricity saved – equivalent to that needed to power the UK for five months, with CO₂ emissions reduced by 60–75 million tonnes – equivalent to taking 13–16 million cars off the road.
The report sets out a set of actions to accelerate the adoption if higher-efficiency motors and generators. It calls on industrialists to move beyond upfront costs and to embed energy efficiency into their procurement decisions, including specifying minimum performance levels and optimised designs. It also highlights the importance of using TCO as the main decision metric, aligning incentives across engineering, procurement and energy management teams.
Stronger collaboration across manufacturers, OEMs and EPC (engineering, procurement and construction) companies will be critical to ensure high-efficiency systems are specified early and delivered at scale, it adds.
ABB says it has tried to persuade other manufacturers of large motors and generators to adopt TIE, or something similar, but so far none have.
