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U.S. Could Save $1.2 Trillion with Energy Efficiency
A new report by the consulting firm McKinsey & Co. shows that with $520 billion invested in efficiency the U.S. could cut our collective national energy bill by $1.2 trillion, a $700 billion return on investment. The firm also called energy efficiency the most compelling way to fight climate change and reported that 40% of U.S. emissions reduction potential comes from energy efficiency. This means that we can dramatically reduce our carbon emissions while also saving money and creating jobs.
The investment would cut U.S. energy consumption by approximately 23 percent, a savings “greater than the total energy consumption of Canada” said Ken Ostrowski, a senior partner at McKinsey. These gains could be made across the board in all sectors, although the report did not look at transportation. The residential sector accounts for about 35 percent of the possible efficiency savings, the industrial sector accounts for about 40 percent and the commercial sector about 25 percent.
The report did not factor in a price that could be imposed on greenhouse gasses. If carbon emissions were priced at $30 per ton it would lead to an additional 8 percent savings.
The McKinsey study outlines recommendations in four main categories:
- Increasing awareness and education: Increasing knowledge about energy saving methods and opportunities will motivate action and allow end-users to act more effectively to save money.
- Increasing incentives and financing: Monetary incentives such as rebates, tax credits, grants and tiered pricing will spur action, as will increased access to financing for capital expenses.
- Changing codes and standards: To capture all of the efficiency potential it may be necessary to mandate upgrades. This could include stricter building codes and efficiency standards for appliances and equipment.
- Third-party involvement: A private company, utility, government agency or NGO could purchase and install energy efficiency improvements directly for the end-user.
The study also identified a number of barriers to achieving the full $1.2 trillion in energy savings. The first would be cost, as this would represent many times the energy spending of the stimulus package, and would have to be maintained for a decade. Many consumers would not have the money for upgrades, even if they would eventually see full payback. There are also issues around who makes investments and who reaps the benefits. In many situations landlords, both commercial and residential, would have to make capital improvements, but it is their tenants who save on the bills.
Despite these obstacles, the report makes it clear that investing in energy efficiency has the potential to save America billions on our energy bills and is the fastest and cheapest way to cut our carbon emissions.
Down on the Farm: Managing Irrigation to Cut Peak Demand
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Image: Flickr
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Hundred of farmers in Idaho are doing their part to curb energy demand on hot summer afternoons. They have enrolled in a program with The Idaho Power Company to shut off electric irrigation pumps when demand soars on hot afternoons. This program can save the power company up to 5% of its peak demand.
By taking a creative approach like this, the power company is eliminating the need to build expensive new power plants to meet that demand.
In the past most farmers kept their irrigation pumps running 24/7 because it was cheaper than sending an employee down to turn them off and on. With the payments from this program farmers can save an estimated $10,000 out of an annual $40,000 pumping bill, more than enough to pay for the trip down to the pump.
By cutting off irrigation on hot summer afternoons there is the added benefit of saving water when it’s most likely to evaporate.
This is just one way to save energy by saving water. Electric pumps are not just used by farmers, there are huge pumps moving water all over California. In fact 19% of the energy used in California goes to pumping, moving and treating water. By saving water in your home or business you will be saving energy across the system.
Posted by Andrew Galbraith on 08/10/09. Email story
Story link | Filed under: Agricultural, Demand Response, Blog Post
Neighborhoods Unite to Save on Home Energy Retrofits
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Under a new pilot program, homeowners can save on energy retrofits (Photo: Department of Energy)
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Building retrofit firm Sustainable Spaces and community organizer One Block Off the Grid (1BOG) are teaming up to help make home energy retrofits more accessible and affordable. As part of a pilot program in the San Francisco Bay Area and Sonoma County, 1BOG will find groups of homeowners interested in retrofits, and refer them to Sustainable Spaces. In turn, Sustainable Spaces will offer a 15 percent discount on retrofitting work to 1BOG participants. By encouraging homeowners to join together in community or neighborhood groups, the program will help bring in a larger customer base for Sustainable Spaces, allowing the firm to pass the rewards on to homeowners.
Sustainable Spaces, a 6th Annual Flex Your Power Award Winner, performs energy audits and implements retrofits, helping to save homeowners an average of 40% on their energy bills. Founder Matt Golden hopes the program will bring in new customers and says he expects more than 30 leads per month once the pilot is running smoothly.
1BOG is known for organizing neighborhood solar panel purchases. The group gathers interested homeowners together and helps participants leverage the power of a larger group to negotiate better bargains. The group plans to use the partnership with Sustainable Spaces as a test to see if its organizing model works in other industries.
Posted by Megan Toth on 08/10/09. Email story
Story link | Filed under: Green Building, Residential, Blog Post
Nation’s First Green Building Standards Code Takes Effect in CA
As of August 1st, 2009, the nation’s first Green Building Standards Code is in effect in California, announced the California Building Standards Commission recently. Plans for the code were announced last year, and while the code is currently voluntary, mandatory rules should be completed by the end of 2010.
The requirements set high standards, requiring new construction to reduce potable water use by 20 percent, a reduction beyond California’s Energy Code which is already one of the most stringent codes in the country. The code also establishes a two tiered 15 or 30 percent energy reduction above current levels for all buildings through a combination of more efficient appliances and windows, better insulation, and other upgrades. The code also includes improvements to air quality and resource conservation and suggests various site improvements such as parking for hybrid vehicles.
“California continues to lead the way in its efforts to reduce the impact buildings have on our environment. This new code encourages the use of renewable, recyclable, and recycled material in the building process, requiring all California buildings to be constructed with the environment in mind,” said Dave Walls, Executive Director of the Commission. “While the new code is voluntary, it is the first step toward meeting the Governor’s 2010 objective.”
Posted by Megan Toth on 08/10/09. Email story
Story link | Filed under: Policy, Blog Post
Tahoe Hotel and Ski Resort Saves $250,000 with Energy Upgrades
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The Embassy Suite Lake Tahoe Hotel and Ski Resort could save close to $500,000 in energy bills by the end of the year thanks to recent upgrades.
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Just seven months after launching efficiency initiatives, the Embassy Suites Lake Tahoe Hotel and Ski Resort has saved $250,000 in energy costs and could save close to $500,000 by the end of this year. Under the leadership of hotel engineering director David Hansen and a team of hotel management, the hotel’s efforts began in January with a property survey, followed by a series of energy-saving improvements that cost a total of $200,000. The project was expected to have a two-year payback period, but the massive savings generated should be enough for the hotel’s owners to recoup their investment in just 10 months. Some of these lucrative improvements include:
- A web-based energy management system, including scheduling software, for managing heating and cooling
- Motorized dampers on outside air returns to allow cooling without air-conditioning
- Variable frequency drives on cooling and condensing pumps (pumps now run at less than 50 percent of capacity)
- A new ozone laundry system
- Lighting retrofits including occupancy sensors, LED exit signs, CFLs and efficient T-8 ballast lighting in the garage
- A Sustainability Committee consisting of 5 employees and 10 managers that meets weekly
- Recycling and waste management improvements
In addition to saving the hotel money, the improvements are also helping the environment, cutting 575,000 kWh of electricity use and 9,314 dekatherms of natural gas, and eliminating 48 tons of waste sent to the landfill annually. As a reward for its improvements, the hotel is set to receive a $10,000 rebate check from Sierra Pacific Power, underscoring the fact that with current stimulus incentives and other programs, there has never been a better time to invest in energy efficiency.
Posted by Megan Toth on 08/10/09. Email story
Story link | Filed under: Success Stories, Commercial, Blog Post
Energy Efficiency Systems Fill Gaps Left by Shrinking Auto Industry
The new green economy is slowly filling gaps left as older industries shrink. Johnson Controls Inc., of Milwaukee, WI, has suffered reduced demand for its automotive electronics components as the overall auto industry has shrunk. The company is making up for the loss by boosting its work in energy efficiency systems and software. As stimulus money goes toward energy efficiency, and building managers look at energy bills to cut costs, they are turning to advanced efficiency systems.
Johnson Controls provides products and services that include HVAC equipment and control systems, industrial and commercial refrigeration and service for commercial, industrial and residential buildings.
The company also makes software that allows users to manage and monitor their carbon footprint. This will not only let businesses become more sustainable, but will prepare them for future climate change regulations.
Finally, the company is upgrading its automotive offerings to become a leader in electric and hybrid car systems.
Johnson Controls is not new to the world of energy efficiency; they won an honorable mention in the 4th Annual Flex Your Power Awards for reducing demand at their own facility.
There are large rewards to be had in the energy efficiency and carbon management fields, and companies like these will help themselves, help the environment and help American workers by being leaders in the industry.
Posted by Andrew Galbraith on 08/10/09. Email story
Story link | Filed under: Success Stories, Commercial, Blog Post