More on energy efficiency versus building a low carbon economy

[Further to my last post here are some pointers on the debate of energy efficiency versus low carbon architectures. While energy efficiency may save an organization money, very rarely does energy efficiency translate into reduced GHG emissions at the utilities coal fired powered plant. Instead it allows the utilities to reduce operation of their more expensive gas plants or to limit the importation of expensive hydro electric power. Coal fired plants are most cost effective when they operate at 100% utilization which is aided and abetted by utility’s energy efficiency programs.

I particularly like the quote from the recent ITIF report on Debunking the Myths of Climate Change “Incidentally, although energy efficiency technologies and measures are certainly an important part of attaining a lower carbon footprint, in reality these are short-run, stop-gap solutions. If we add all of the potential savings from energy efficiency, they only abate about 25 percent of GHG emissions. To make matters worse, the “low hanging fruit” will grow smaller over time, decreasing returns to our efforts.”

If we are truly concerned about climate change we need to adopt policies that truly reduce GHG emissions. This is why any proposed “green” solution needs to be developed as a GHG standard accepted by various GHG registries according to the ISO 14064 standard. This applies to any proposed research project as well .Only then will any claim of being green can be independently verified as reducing GHG emissions. Although this process is much harder than energy efficiency hand waving, it will genuinely result in real low carbon solutions. The intellectual challenge of building low carbon solutions is much harder than most of the lazy thinking associated with energy efficiency – but on the upside the outcomes can generate real investment, jobs and economic growth.

In my opinion there are two rules of thumb to building solutions for a low carbon economy:
(1) They must use renewable power sources only in order to de-couple energy production from GHG emissions
(2) They must not involve electric utilities or the grid

For examples of some ideas on products and services for a low carbon economy please see my presentation to National Research Council:

http://www.slideshare.net/bstarn/nrc-july-6
--BSA]






Debunking the Myths of Global Climate Change

http://theenergycollective.com/darrenehackler/38789/debunking-myths-global-climate-change?utm_source=feedburner&utm_medium=twitter&utm_campaign=The+Energy+Collective+(all+posts)&utm_content=Twitter


Numerous advocacy groups, scholars, think tanks and others have proposed a variety of steps to address global warming based on a set of assumptions about the green economy. Yet, while we need to take bold action to address climate change, much of what passes for conventional wisdom in this space is in fact either wrong or significantly exaggerated.

In our recent report, “Ten Myths of Addressing Global Warming and the Green Economy,” ITIF explains how the debate on policy responses to climate change is fueled by an array of myths, ranging from assumptions that high carbon taxes will generate needed clean innovations to the belief the U.S. is the natural leader in the clean energy sector. If we are to effectively address climate change and at the same time become globally competitive in the clean energy industry, policies need to be guided by careful and reasoned analysis.

Perhaps the most prevalent myth is that carbon taxes or a cap-and-trade regime alone will drive significant GHG reductions and save the planet. The current neoclassical economics-inspired solution focuses on pricing carbon and letting markets work. Proponents have faith that increasing the price of carbon will induce behavior change. But this will only happen when there is a viable and affordable substitute. Adherence to this entrenched myth overlooks the fact that radical innovation in the energy sector is essential to the transformation in how we produce and consume energy in the future. Our strategy must be based on innovation to make the dent we have to make in our greenhouse gas production.
And, by the way, cap and trade–the darling of the moment–isn’t a globally sustainable option. It’s a myth that developing nations can afford to pay a premium for low-carbon energy when they are having trouble enough with providing the basics of food and shelter. The conventional policy response is that the United States (and Europe) should either bribe poor nations with massive clean development aid so they can afford more expensive clean energy, or we should penalize them with border adjustable carbon taxes. And neither option comes for free since the United States would need to increase taxpayer-financed aid subsidies to meet developing countries clean energy demand. The end result is that U.S. taxpayers would pay twice in a global cap-and-trade regime—once for their own consumption and once for developing nations’. The only globally sustainable option is the creation of affordable (read “grid parity”) clean energy for all nations.

The reality, however, is that we don’t have the technology we need to make needed reductions in global GHG emissions at a price at or below the price of fossil fuels—no matter what advocates like former vice president Al Gore say. This notion plays into the policy advice that suggests we just need to raise the price of coal and oil a bit, and technology will fly from the shelf and into the market. This ignores a fundamental truth that the needed breakthroughs in clean energy face daunting challenges, including lowering materials and processing costs, improving conversion efficiencies, and gaining better manufacturing yields. Moreover, clean energy innovators recover only a portion of the benefits their technologies produce. Most companies prefer to “free ride” off existing dirtier technologies, making the rational business decision to under invest in fundamentally new green technologies. To spur the technology we need, government must step in, incentivize basic R&D and propel these technologies through the “valley of death” – the phase in the development of technologies between research and commercial introduction in the marketplace.

Incidentally, although energy efficiency technologies and measures are certainly an important part of attaining a lower carbon footprint, in reality these are short-run, stop-gap solutions. If we add all of the potential savings from energy efficiency, they only abate about 25 percent of GHG emissions. To make matters worse, the “low hanging fruit” will grow smaller over time, decreasing returns to our efforts. To reduce our GHG emissions by 85 percent by 2050, we need radical innovation to provide clean energy alternatives, rather than just using carbon-based fuels a bit more efficiently.




•
• China Fears Warming Effects of Consumer Wants
• http://www.nytimes.com/2010/07/05/business/global/05warm.html


GUANGZHOU, China — Premier Wen Jiabao has promised to use an “iron hand” this summer to make his nation more energy efficient.


But even as Beijing imposes the world’s most rigorous national energy campaign, the effort is being overwhelmed by the billionfold demands of Chinese consumers.
Chinese and Western energy experts worry that China’s energy challenge could become the world’s problem — possibly dooming any international efforts to place meaningful limits on global warming.
If China cannot meet its own energy-efficiency targets, the chances of avoiding widespread environmental damage from rising temperatures “are very close to zero,” said Fatih Birol, the chief economist of the International Energy Agency in Paris.
Aspiring to a more Western standard of living, in many cases with the government’s encouragement, China’s population, 1.3 billion strong, is clamoring for more and bigger cars, for electricity-dependent home appliances and for more creature comforts like air-conditioned shopping malls.
As a result, China is actually becoming even less energy efficient. And because most of its energy is still produced by burning fossil fuels, China’s emission of carbon dioxide — a so-called greenhouse gas — is growing worse. This past winter and spring showed the largest six-month increase in tonnage ever by a single country.
China’s goal has been to reduce energy consumption per unit of economic output by 20 percent this year compared with 2005, and to reduce emissions of greenhouse gases per unit of economic output by 40 to 45 percent in 2020 compared with 2005.
But even if China can make the promised improvements, the International Energy Agency now projects that China’s emissions of energy-related greenhouse gases will grow more than the rest of the world’s combined increase by 2020. China, with one-fifth of the world’s population, is now on track to represent more than a quarter of humanity’s energy-related greenhouse-gas emissions.
Industry by industry, energy demand in China is increasing so fast that the broader efficiency targets are becoming harder to hit.
¶Although China has passed the United States in the average efficiency of its coal-fired power plants, demand for electricity is so voracious that China last year built new coal-fired plants with a total capacity greater than all existing power plants in New York State.
¶While China has imposed lighting efficiency standards on new buildings and is drafting similar standards for household appliances, construction of apartment and office buildings proceeds at a frenzied pace. And rural sales of refrigerators, washing machines and other large household appliances more than doubled in the past year in response to government subsidies aimed at helping 700 million peasants afford modern amenities.
¶As the economy becomes more reliant on domestic demand instead of exports, growth is shifting toward energy-hungry steel and cement production and away from light industries like toys and apparel.




Obama's Energy Pipe Dreams
http://www.newsweek.com/2010/06/21/obama-s-energy-pipe-dreams.html


… we won't soon end our "addiction to fossil fuels." Oil, coal, and natural gas supply about 85 percent of America's energy needs. The U.S. Energy Information Administration (EIA) expects energy consumption to grow only an average of 0.5 percent annually from 2008 to 2035, but that's still a 14 percent cumulative increase. Fossil-fuel usage would increase slightly in 2035, and its share would still account for 78 percent of the total.

Unless we shut down the economy, we need fossil fuels. More efficient light bulbs, energy-saving appliances, cars with higher gas mileage may all dampen energy use. But offsetting these savings will be more people (391 million vs. 305 million), more households (147 million vs. 113 million), more vehicles (297 million vs. 231 million) and a bigger economy (almost double in size). Although wind, solar, and biomass are assumed to grow as much as 10 times faster than overall energy use, they provide only 11 percent of supply in 2035, up from 5 percent in 2008.

"Clean energy" won't displace oil or achieve huge reductions in greenhouse-gas emissions—for example, the 83 percent cut by 2050 from 2005 levels included in last year's House climate-change legislation. Barring major technological advances (say, low-cost "carbon capture" to pump CO2 into the ground) or an implausibly massive shift to nuclear power, this simply won't happen. It's a pipe dream. In the EIA's "reference case" projection, CO2 emissions in 2035 are 8.7 percent higher than in 2008.


A good overview of the challenges of building a low carbon infrastructure
http://www.withouthotair.com/download.html
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