Exergy efficiency in industry: where do we stand?

Efficiency is a term generally used to determine how well a system performs. However, efficiency can have different meanings and, unaccompanied by a formal definition or taken out of context, can lead to serious misconceptions. In many official publications, efficiency is calculated as the ratio of useful output to energy input. This measure reflects the first law of thermodynamics (conservation of energy) but does not reflect the potential for improvement. A better measure, that also reflects the second law of thermodynamics, is the ratio of the potential useful (exergy) output to the potential useful (exergy) input. We estimate second law efficiencies for the inorganic and organic chemical industries to be 29% and 35% respectively. We also estimate the efficiency of the U.S. industry sector as a whole to be 37.6%, as compared to only 7.7% for the overall U.S. economy. These figures are far lower than the "first law" figures published by the U.S. Department of Energy (80% for industry and 42.5% overall) and they imply a significant potential for improvement.