Steven Chu Begins Nationwide Energy Efficiency Push in US


Photo via Bellona
It's About Time . . .
Steven Chu has an op-ed from the World Economic Forum report reposted in the Huffington Post today, and it's full of both good points and good news. The ol' one-two goodness combo, as I like to say (full disclosure: I've never said that before in my life). Moving on. Highlighted in the piece are some ironclad arguments as to why energy efficiency should be a major focus right now, along with a number of initiatives and ideas designed to encourage the retrofitting of US buildings, and to aid in making sure new ones are built to be energy efficient in the first place. Chu's entire piece is certainly worth a read over at the Huffington Post, but here are some of pertinent parts, starting with the intro:
For the next few decades, energy efficiency is one of the lowest cost options for reducing US carbon emissions. Many studies have concluded that energy efficiency can save both energy and money. For example, a recent McKinsey report calculated the potential savings assuming a 7% discount rate, no price on carbon and using only "net present value positive" investments. It found the potential to reduce consumer demand by about 23% by 2020 and reduce GHG emissions by 1.1 gigatons each year -- at a net savings of US$ 680 billion.
Which is about as strong of a case as you could hope for in emphasizing energy efficiency in policy--especially because energy efficiency initiatives can be among the least controversial and most immediately effective ways to cut carbon emissions.

So what are some of the policy ideas that Chu is putting forward to improve energy efficiency in the US? He details a few:

  • We are pursuing energy efficiency in many areas -- from toughening and expanding appliance standards to investing in smart grid -- but improving the efficiency of buildings, which account for 40% of US energy use, is truly low hanging fruit.

  • the Department is working to develop a strong home retrofit industry. We are creating a state-of-the-art tool that home inspectors can use on a handheld device to assess energy savings potential and identify the most effective investments to drive down energy costs.

  • We're also investing in training programs to upgrade the skills of the current workforce and attract the next generation.

  • we're pursuing new technologies such as infrared viewers that will show if insulation and caulking were done properly. Post-work inspections are a necessary antidote and deterrent to poor workmanship.

  • To address inconvenience and to reduce costs, we're launching an innovative effort called "Retrofit Ramp-Up" that will streamline home retrofits by reaching whole neighborhoods at a time. If we can audit and retrofit a significant fraction of the homes on any given residential block, the cost, convenience and confidence of retrofit work will be vastly improved. Another goal of this program is to make energy efficiency a social norm.

  • To help pay for investments, we're working with the Department of Housing and Urban Development to encourage new financing tools. For example, homeowners might pay back energy improvement loans via an assessment on their property tax bill.

And for new construction, where the biggest gains stand to be made:
  • By developing building design software with embedded energy analysis and building operating systems that constantly tune up a building for optimal efficiency while maintaining comfort, extremely cost-effective buildings with energy savings of 60-80% are possible.

Efforts to create a 'retrofit industry' are especially interesting, and is one of the ideas the Obama administration appears fondest of, as evident in its Cash for Caulkers program.

One question nags: why, if energy efficiency improvements make so much sense, and can save so much money, hasn't the free market already taken advantage? Chu responds:

Market failures include inertia, inconvenience, ignorance, lack of financing and "principal agent" problems (e.g., landlords don't install energy efficient refrigerators because tenants pay the energy bills). To persuade the skeptics and spark the investments in efficiency we need, the Department of Energy is now focused on overcoming these market failures
Let's see if the DOE's new initiatives can help overcome some of these obstacles to greater improvements in nationwide energy efficiency.

More on Energy Efficiency
Building Green: Energy Efficiency and Aesthetics From The Same Mold
Beating the Energy Efficiency Paradox (Part I)

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