The Cause of Conservation

 

 
  May 9, 2007
 
Will high energy prices give Americans more incentive to conserve? Citizens will, invariably, reach their limits. And a bill now pending in Congress aims to give consumers and manufacturers a push so that they reach that tipping point.

Ken Silverstein
EnergyBiz Insider
Editor-in-Chief

The goal of the bipartisan measure is to promote energy efficiency in vehicles, buildings and consumer and industrial equipment. To do this, the legislation would promote the development and use of advanced lighting technologies while expediting new efficiency standards for appliances and industrial equipment. It would also facilitate high efficiency vehicles that use advanced batteries and set goals for cutting gasoline consumption.

"The Energy Efficiency Promotion Act will reduce consumers' future energy bills by getting more from the energy we produce," says Sen. Jeff Bingaman, D-N.M, author of the bill along with Sen. Pete Domenici, R-N.M. "High energy prices and the threat of global warming are very much on Congress's agenda this year. This bill is an effective step toward addressing both problems."

In the transportation area, for example, the bill sets a goal of reducing gasoline use, compared with currently projected levels, by 20 percent by 2017, 35 percent by 2025, and 45 percent by 2030. The bill also sets a goal of improving the nation's overall energy productivity, measured in gross domestic product per unit of energy output, by 2.5 percent a year by 2012.

In the lighting area, the bill states that "national policy can support a rapid substitution of new, energy-efficient light bulbs for the less-efficient products in widespread use" to achieve annual savings of $18 billion, 158 million tons of emissions, and the amount of electricity produced by 80 base load coal-fired power plants.

On the appliance standards alone, the bill's proponents say that it would provide the following savings:

 

  • Electricity: At least 50 billion kilowatt hours per year, or enough to power roughly 4.8 million typical U.S. households;
  • Natural gas: 170 million therms per year, or enough to heat about a quarter million typical U.S. homes;
  • Water: At east 560 million gallons per day, or about 1.3 percent of total daily potable water usage, and
  • Dollars: More than $12 billion in net present benefits for consumers.

"Advancing energy efficiency through federal policy is a `win-win' for Americans, in that such measures can deliver substantial monetary savings to consumers and businesses -- both directly and by lowering taxpayer-supported federal and state energy costs -- and can substantially reduce global-warming emissions," says Alliance to Save Energy president Kateri Callahan.

Government's Role

Greater conservation makes the most of national energy resources, reduces the costly results of energy shortages, lessens our reliance on energy imports, and minimizes the impacts of pollution. But some question the role of the federal government in this process, noting that the free market should be the determinate of whether new products with bells and whistles become commercially viable.

Sterling Burnett, with the National Center for Policy Analysis in Dallas, says that if people want more energy-efficient household appliances or insulation systems, they can buy these products. He points to Denmark, which mandated energy efficient appliances in the late 1970s. While energy use in new washing machines and new freezers dropped 25 percent and 31 percent, respectively, from 1978 to 1986, he says that total domestic consumption in electricity rose by 20 percent during the same time period.

"Greater efficiency leads to increased energy consumption, because increased efficiency lowers costs, which makes goods more affordable -- increasing demand," the center says while Burnett adds: "I have problems with government forcing these choices through tax policy, subsidies or mandates."

But, the American Council for an Energy Efficient Economy counters that conservation can be an effective resource for reducing peak demand as well as overall load. It has a study documenting how energy efficiency programs can deliver savings during peak demand periods when the power grid is most stressed.

Indeed, it emphasizes that everyone has a role to play and oftentimes it involves simple steps such as turning off lights when leaving a room. Other times, it may mean adjusting energy usage so as to put less strain on the generation and delivery system. The most sophisticated energy users, meantime, have a strong incentive to employ modern efficiency standards because their energy bills are so high.

"Using energy efficiency to reduce peak demand is especially attractive because such savings get built into our energy systems; the savings occur every time an energy-efficient device is used, whether that's a high efficiency commercial lighting system, a more efficient air-conditioner, or a high efficiency motor," says Martin Kushler, utilities program director for the council. "With energy efficiency, we not only get peak demand savings, but also year-round or seasonal savings that yield lower power plant emissions, including greenhouse gases, and lower overall customer and utility costs."

Energy efficiency has traditionally taken a back seat to energy production. But implementing conservation standards is less controversial and less costly than building new transmission, generation or distribution. It's a meaningful cause as residential, commercial and industrial users get a breather on their power bills while utilities are able to avoid huge capital investments and the deferral of maintenance.