Public Power - November 2008 - (Page 12)

10 QUESTIONS tors and about half that to pumps, etc. Whether you classify it by sector or end use service, it is fair to say that the potential [for savings] is huge in essentially every application and every sector. Normally, the new buildings that we design at RMI—and we’ve done more than a thousand—save about 80 to 90 percent of energy and cost less than normal to build. In industry, my team has done over $30 billion of redesign in 29 sectors. We find retrofits saving 30-60 percent of energy. New facilities save 40-90 percent. In motor systems, we showed in 1988 that 35 retrofitable improvements could typically save about half the drive system electricity, with a payback of about one year. EPRI came to similar conclusions. financing, and then they started direct delivery of efficiency services. Rebate began in the 1980s. They were so effective that about 1983 to 1985, some big utilities were saving electricity rapidly. Southern California Edison, which served 9 million people, cut its projections of peak demand by about 8 percent every year. There are many examples from the 1980s and 1990s that showed a huge pent-up demand for efficiency services, and utilities—from tiny munis to giant IOUs—displayed a high level of skill in marketing and delivering these services. It worked so well that demand crashed, utility attention wandered and momentum stalled on the shared coupling of savings. Only now, with backing from electric and gas utilities, is activity spreading to get customer and utility incentives aligned. Any utility should look at efficiency as a lot cheaper than running thermal plants. It improves the quality of service delivered and buys the most reliability and risk reduction for the utility. It is a way to provide better service at lower cost and make more money with less risk. That can be seen in the sustained drop of 2 percent in energy intensity in the United States. Imagine what happens if we pay attention and reward utilities for what we want. If customers figure out the efficiency bonanza available to them, they will buy more of it. It is a good idea to sell customers what they want before someone else does. There is no guarantee that customers will continue to buy electricity in the amount they did in the past. Anyone contemplating building a large thermal plant is at risk because of the competitive landscape, where the majority of new electricity services are delivered by efficiency and micropower (cogeneration, plus renewables, minus big hydro). Utilities have a big new toolkit at their disposal to capture efficiency opportunities. It builds on the approach for marketing negawatts. Utilities can PUBLIC POWER Amory Lovins Amory Lovins is cofounder, chairman and chief scientist of the Rocky Mountain Institute. Alice Clamp interviewed him on Sept. 17, 2008. In your July 2008 Forbes article, you say that by fully exploiting, wherever practical, the best available efficiency techniques, the United States could save three-fourths of the electricity we use. You mention such things as designing friction out of pipes and ducts. What else can we do to achieve this “negawatt” potential? Three-fourths of electricity could be saved by economy-wide retrofits over decades, based on the Rocky Mountain Institute’s analysis of about 1,000 technologies in the late 1980s. The savings were documented in previous reports, so they are not a number grabbed out of the air. What’s happened since then is that some of those opportunities have been used, but they have expanded even more because technology keeps getting better and cheaper faster than we apply it. As [the Electric Power Research Institute] would agree, efficiency is an ever bigger and cheaper resource than it was in 1989 when I did the analysis. About 69 percent of U.S. electricity is used in buildings and the rest in industry. About three-fifths goes to mo12 NOVEMBER-DECEMBER 2008 1 2 What role can or should electric utilities play in energy efficiency? What about utility customers— industrial, commercial and residential? What are the best ways to encourage conservation on their part? Electricity utilities should be extremely efficient in their own operations. If they do a whole system retrofit of power plant auxiliaries, they can gain several percent on heat rate with excellent economics. A few utilities have efficient headquarters buildings or data centers. These are some ways of improving operations and learning what it takes to do exemplary energy efficiency. The big target is on the customer’s side of the meter. If it is cheaper to save electricity than produce and deliver it, counting only operating costs, you should save electricity no matter how much capacity you have. It is cheaper not to run it than to run it. Utilities, in collaboration with trade allies, should be leaders in bringing efficiency to every customer—without abusing the customer relationship. In the past, utilities provided information to customers, which was helpful but not very effective. They added

Table of Contents Feed for the Digital Edition of Public Power - November 2008

Public Power - November 2008 Contents Perspective 10 Questions Capturing Knowledge Before It Retires Jackson’s GIS Search Keeping a Job Journal Japan Tackles the Kyoto Protocol Getting to 20 by 10 Damless Hydro Power Earthquake: The Hidden Disaster For Engineers Safety For Governing Boards DEED Hometown Connections Parting Shot

Public Power - November 2008

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