Other renewables

• Hydro
  Hydro resources in the USA are largely developed and there is little room to increase. We should continue to operate what we have and find better ways to solve fish migration problems than tearing out productive dams.

   

• Bio-Mass
  There is a lot of room to recycle agricultural waste and municipal sewage with both recovery of energy and vital nutrients, and progress has been rapid in the last decade. Processes like methane producing digesters, thermal depolymerization, enzyme aided “digestion?” and pyrolisis are now operational and ready for large-scale deployment. Intentionally growing bio sources like switchgrass and willow coppice on otherwise unused land has also been proposed and seems practical. The total contribution could be in excess of 10 quads, with significant environmental benefits. Growing crops for biomass energy (e.g. ethanol) can make some contribution to bridging the petroleum-hydrogen transition, but is probably not beneficial or desirable in the long run. It is mainly a disguised agricultural subsidy, and should not figure strongly in a responsible National Energy Policy.

   

• Geo-Thermal
  There are two major uses:
  Using near constant temperature subsoil (down to about 200 feet) as a heat source or sink for building heat pumps. These are much more efficient than common air-to-air heat pumps and have an economic payback in 5 to 8 years typically. Widespread use could cut HVAC energy needs by up to 30% nationwide. A sound energy policy should support such opportunities.

  Deep magma heated water/steam (hydrothermal) and “dry hot rock” sources for power generation. USA hydrothermal resources are estimated as near 1 quad, and nearly ¼ of that has been tapped. Dry hot rock potential seems to be the holy grail of geothermal advocates, but the technology is not viable today, and may be decades away.

   

• Wave/Tidal
  There is much promise but no practical application as yet. It makes sense to continue moderate R & D support.

   

• In summary
  Including wind and solar, renewables are sufficiently abundant and useable to meet all the energy needs of an energy efficient economy and support a complete phase-out of fossil fuels and nuclear energy before the end of this century. (I do not delude myself that that is likely to happen, but it is feasible). At the same time, we would phase out environmental degradation, pollution, and dependence on foreign fuel sources, and would help the economy by creating jobs and improving the balance of payments. The technology exists, but some still needs development to be competitive. All we need is the good sense, the patriotism, and the will to get on with the job.

Demand reduction
In a late April 2001 speech in Toronto, Vice President Cheney was quoted as saying, “I would oppose any measure based on the premise that … people should do more with less.” In a May 18, 2001 editorial, Secretary Abraham focused on infrastructure; projected major demand growth; assumed demand can only be reduced through taxes, SUV laws, moving jobs offshore, and applying new technology; and put more focus on nuclear than renewables. Why is Vice President Cheney opposed to efficiency? Why is Secretary Abraham casting the demand side only in negative terms? It is clear that, like the blind men in the Sufi fable, they have only touched part of the elephant.

The most important benefits of addressing the demand side are:

• Results are available immediately, not years from now.
• Effects are widely dispersed throughout the economy and therefore not vulnerable to attack.
• The energy freed up through energy efficiency typically costs from 0.6¢ to 3.0¢ per kWh. New supply costs 4¢ to 10¢ per kWh.
• Reducing waste is economically and environmentally good practice.
• Efficiency replaces imports, benefiting the balance of payments.
• Efficiency is purely domestic, eliminating dependence on unstable foreign sources.
• Retrofitting the economy, to realize efficiencies, creates jobs nationwide.
• Efficiencies replace fossil fuels, overcoming shortages and benefiting the environment.
• There are no “dry-holes.”

What we need first is a belief that there are amazing achievements possible on the demand side, and then constructive and imaginative ideas on how to encourage, promote, and support such achievements. We do not need knee-jerk reactions and cants about taxes and bans that bias the discussion.

Unfortunately, this is a large, general topic that can fill books (and has). (For a good idea list go to: http://www.interfaceinc.com/us/company/sustainability/pletsus.asp?page=2) Experts who have studied various aspects of the subject believe that the American economy can thrive with a factor 4¹ reduction in energy per unit of GDP. (Switzerland is actually almost at that level.) The most optimistic discuss the possibilities for factor 10. Extensive study, and some successful practice, over the last 10 years persuades me that factor 4 is easy over a longish time horizon. It could be done relatively quickly with more or less drastic policies, but that is not necessary. However factor 4 would require intelligent, but not burdensome, attention to recycling and waste reduction, ideas not yet popular in our profligate society. Going much beyond factor 4 would require some life style changes, such as migration from the suburbs back to the cities, and extensive development of efficient mass-transit, processes that are already under way. Factor 2 in the next 30 years is both readily doable, and probably sufficient for the first phase of a long-term policy. Any target less than factor 2 in 30 years is irresponsible. ACEEE has made a number of readily doable policy proposals that would reduce demand side energy per unit of GDP by 36% over less than 20 years.² Their proposals overlook several opportunities that are not easily addressed by policy, but are readily achievable in an energy conscious society, that would move the target to about 46%. None of these opportunities address recycling and waste reduction, which would move us beyond 50%.

It is not possible to make this case well in a short paper. I will try to provide a few illustrations and several references that may help. We need to consider five major areas of demand side opportunity: consumer/commercial, industrial, transportation, electric power generation, and regulatory barriers/perverse incentives.

Consumer/Commercial
Mainly homes, office buildings, hotels, stores, etc. There are many sources³ of lists of improvements that can be made to homes and buildings, either by retrofits or new construction. (Google on “energy efficiency”, buildings). Energy reductions from 30% to 70% are common. Technology is simple, everyday, and widely available. Changes include eliminating air leaks, extra insulation, low-e glazing, daylighting, shade, reflective foil in attics, loss free ducts, compact fluorescent bulbs, motion detectors, replacement of CRTs, etc. More elaborate changes like geothermal heat pumps and efficient appliances add to the potential.

Industrial
Facilities engineers tend to be self-effacing and are almost never on the councils of upper management. Plant design firms are rarely asked to consider energy efficiency, and they rarely know how. Designs are piecemeal, not holistic, so synergies are not realized. Older managers fail to be aware of, let alone adopt, new developments. Finance managers go for low first cost and ignore lifetime costs. Experience shows that most factories that have not experienced major energy efficiency campaigns can reduce energy consumption >30% with “no cost/low cost” improvements, having economic payback < 2 years at virtually zero risk. Further efforts with low risk paybacks of less than 5 years can increase this number to 50%-60%. (CFOs with a 2-3 year payback on rather risky investments mindset have to be persuaded of the low risk). There is a convincing body of literature illustrating greenfield developments that have yielded 4x to 10x improvements. (See ³ RMI).

A simple example: fan energy varies directly with air volume, but as the cube of air velocity. Off peak, running two cooling towers at half volume instead of one at full volume provides the same volume of cool air at half the velocity, and therefore one eighth of the energy per tower or ¼ of the system energy. This simple example is counter-intuitive and rarely known or practiced. Many, many other examples can be cited.

Some real industrial examples may help. Philips is a large, multi-plant European firm that got serious about environmental issues several years ago. Using 1994 as a baseline year, they improved energy efficiency corporate-wide by 31% in five years, water efficiency 45% in five years, and waste intensity by 56% in five years. In the process, Philips has learned enough to know that a lot more can be done.⁴ See also STMicroelectronics with 44% reduction in energy per unit of value added from 1994 through 2003, and Interface Inc with similar achievements.⁴

The USA has only a handful of industrial energy experts, and for sure, none of them were consulted by the NEPDG.

Transportation
Considerable work is underway to make busses and some trucks more efficient. California has successfully tested hybrid electric busses and semi-trailer tractors getting double the mileage of conventional diesels. A holistic energy policy should promote growth of rapid transit (e.g. light rail) in major metropolitan areas. However, the big opportunity is the automobile. CAFÉ standards need to be raised, and the light truck loophole, except for certified farm working trucks, needs to be phased out. ACEEE has proposed raising CAFÉ standards by 5%/yr for at least 20 years. Existing HEVs can already meet the 15th year goal, and redesigning cars for light weight and low rolling resistance would push well beyond the 20th year goal, so this proposal is readily achievable. We should fix the goal and let Detroit figure out how to meet it. They will bleed all over the floor, as they and the utilities did over the clean air act, but in the end they will be able to meet the goal without ruining either their business or the economy.

Even Secretary Abraham admits that hybrid-electric technology can produce 60-mpg cars already. Actually, at least 70 mpg from a safe, comfortable, affordable, and attractive full size car is feasible. As we make the transition from conventional gasoline powered ICE heavy cars, to light fiber-composite, aerodynamic, low rolling resistance hydrogen/fuel cell powered cars our present consumption of about 22 quads of petroleum could be replaced by about 4 quads of renewably generated primary electricity.

We also need a way to rate cars for fuel economy, and devise a means of charging higher pump as well as licensing prices for lower efficiency vehicles. Those who want to hasten the depletion of a scarce resource should have to pay for the privilege.

Electric Power
Here we need to look at both demand and supply (electricity supply is mainly primary energy demand). In the mid 1980s demand side management (DSM) by electric utilities started to become popular, as utilities discovered they could subsidize consumer demand reduction investments for much less than the capital cost of new capacity. Regulators let them record such expenditure as capital investment, and depreciate it over 30 years giving them a way to make money. Customers paid for the investments over time, but they paid less than they would have for new capacity. By 1990 there were 1300 participating utilities with 13 million participating customers. By 1996 DSM had lowered peak demand by 29 GW, equivalent to 60 large-scale coal fired plants. This was about 6% of installed peak capacity and greater than the total combined peak load of 6 New England states, and was done for less than 3 cents/kWh. The surface had just been scratched, and the results were impressive.

Then came deregulation which left utilities with only the motivation to sell all of the kWh they could, at the lowest operating cost they could achieve. Deregulation was supposed to lower electricity cost for the consumer, from what were already the lowest rates in the world, but what it achieved was to lower intelligent energy economies, lower maintenance expenditures, lower system reliability, and finally lead to the 2003 blackouts. By 1998 DSM expenditures had dropped by ½ from what they were in 1993. By 2000 there were only 962 participating utilities and annual savings were about 1/6th of their peak.

On the supply side, average USA electricity generation efficiency peaked in 1958 and had not improved by 1998, although the newest electricity-only generation plants reached peak efficiency of 57% in 1997. In 1998, 2/3 of electric generating capacity was more than 25 years old, and much would have been shut down in an energy conscious world. In 2001 850 old, inefficient, high pollution power plants built before 1970 were still operating, providing about 20% of power generated. The current Administration’s Orwellianly named Blue Sky Initiative will let them keep running without useful upgrades for years yet.

The NEPDG called for 1,300 new plants to be built by 2020, and paid no regard to their efficiency or to the DSM alternative. Our challenge is not building 1.300 new plants by 2020; it is replacing the old polluting, inefficient plants with modern, clean, efficient plants, while reducing demand by near 25% at much lower cost than adding supply. Replacing most of the existing plants with new efficient plants would increase available electricity by about 50% with no increase in fossil fuel use. The ACEEE has identified 5 straightforward areas of savings that could reduce demand by 100 GW in the same time frame.

Fortunately, 11 states have restarted DSM initiatives with state subsidization of savings. Vermont may be the leader, having created an Energy Efficiency Utility, in effect selling energy savings, “negawatts” instead of megawatts. Unfortunately the combined funding is only about 25% of 1993 DSM funding by utilities.

Regulatory Barriers/Perverse Incentives⁵
Electricity customers do not want electricity. They want light, heat, and work. Regulated monopoly electric utilities, as a good concept, have outlived their usefulness. They need to be redefined as efficient energy providers. Energy markets do not need deregulation; they need intelligent re-regulation that promotes efficient energy provision and consumption. There is no room here to deal with this subject in detail. Policy planners should read Casten⁶ with special attention to his “Energy Regulatory Reform and Tax Act” (ERRATA) proposal, thus saving a lot of time and effort.

Similarly perverse subsidies like tax breaks to buy Hummers and classification of the PT Cruiser as a light truck need to be addressed. Such example abound.

Perverse barriers to efficiency need to be replaced with intelligent regulations and incentives that harness market forces. The Clean Air Act, with enforceable emissions limits and permit trading, is the model to use. Results have been achieved at less than 10% of the cost the pre-act Cassandras were predicting. Government should not regulate how things get done technically, but should rather set standards and incentives, and let industry figure out how to achieve results. Revenue neutral tools like Amory Lovins’ proposed “feebates” can be very effective.

Conclusions
Other than wind and solar, the potential for renewable energy is quite limited in magnitude, but waste biomass especially should be exploited because of its environmental benefits.

If, as Secretary Abraham has stated, a prime aim of a national energy policy is to reduce dependence on foreign energy, the place to start is the demand side.

There is vast potential in the US economy to increase energy intensity by increasing efficiency and reducing waste, with large economic benefits.

We need a National Energy Policy that sets ambitious demand side goals, with supportive standards and incentives.

The NEP should be designed mainly by energy efficiency experts, and while consultation with industry is desirable, influence by industry must be minimized or prevented entirely.

References

1. Factor Four, Weizsacker, Lovins and Lovins, Earthscan Publications Ltd., 1997, ISBN 1- 85383-407-6.

    

2. http://www.aceee.org/pubs/e012execsum.pdf

    

3. http://www.rmi.org/sitepages/pid385.php, http://www.aceee.org/pubsmeetings/index.htm

    

4. PhilipsEnvironmentalReport2000, http://www.st.com/stonline/company/environm/sustdev/sustdev03.pdf http://www.interfacesustainability.com/metrics.html

    

5. “Perverse Subsidies,” Myers and Kent, Island Press 2001, ISBN 1-55963-835-4.

    

6. ”Turning off the Heat,” Thomas R. Casten, Prometheus Books 1998, ISBN 1-57392-269-2.

Other sources

Home Made Money, Richard Heede & RMI, Brick House Publishing Co., 1995, ISBN 1-883178-07-X.

Greening the Building and the Bottom Line, Joseph J. Romm, Rocky Mountain Institute.

Climate – Making Sense and Making Money, Rocky Mountain Institute.

Natural Capitalism, Hawken, Lovins and Lovins, Little, Brown & Co., 1999, ISBN 0-316-35316-7.

http://www.ems.org/lighten_the_load/index.html

http://www.aceee.org/pubs/e013execsum.pdf

http://healthandenergy.com/energy_efficient_homes.

http://www.energystar.gov/

http://www.interfaceinc.com/us/company/sustainability/pletsus.asp?page=5

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