Agreements to meet specific energy use, energy efficiency, or greenhouse gas emissions reduction targets are used widely in the industrial sector. Such agreements can be viewed as a tool for developing a long-term strategic plan for increasing industrial energy efficiency that fully engages not only the engineers and management at industrial facilities, but also includes government, industry associations, financial institutions, and others.

Voluntary agreements for energy efficiency improvement and reduction of energy-related greenhouse gas emissions have been a popular policy instrument for the industrial sector in industrialized countries since the 1990s. A number of these national-level voluntary agreement programs are now being modified and strengthened, while additional countries -- including some recently industrialized and developing countries -- are adopting these type of agreements in an effort to increase the energy efficiency of their industrial sectors. Voluntary agreement programs can be roughly divided into three broad categories: 1) programs that are completely voluntary, 2) programs that use the threat of future regulations or energy/GHG emissions taxes as a motivation for participation, and 3) programs that are implemented in conjunction with an existing energy/GHG emissions tax policy or with strict regulations. A variety of government-provided incentives as well as penalties are associated with these programs. A key element of Voluntary Agreements is that they focus the attention of all actors on energy efficiency or emission reduction goals.

Internationally, Voluntary Agreements have been shown to result in increased energy efficiency, with the more successful programs even doubling autonomous energy efficiency improvement rates. In addition, Voluntary Agreements have important longer-term impacts including changes of attitudes and awareness of managerial and technical staff regarding energy efficiency, addressing barriers to technology adoption and innovation, creating market transformation to establish greater potential for sustainable energy-efficiency investments, promoting positive dynamic interactions between different actors involved in technology research and development, deployment, and market development, and facilitating cooperative arrangements that provide learning mechanisms within an industry.