Jun 02 2011

Energy Efficiency is Essential

Published by under Student blog entries

“Efficiency is the steak. Renewables are the sizzle,” says Carl Pope of the Sierra Club. Big renewable-energy projects like offshore wind farms are glitzy and glamorous for the energy generating industry, but these technologies could never have a serious impact on carbon reduction if energy consumption is inefficient. If products like light bulbs, stoves, computers, and hair dryers (anything that uses electricity) need less energy to operate, there will be less overall demand for energy generation. With a relatively stable demand despite a growing population, shifts away from dirty energy generation will not constantly be fighting an uphill battle to meet ever-rising needs. This idea is the backbone of Vermont’s energy efficiency plan to cut the projected 2015 energy demands by 15% which would basically keep demand stable for eight years (2007 article publication).

However, making a goal is always easier than achieving it. Investing in more energy efficient products is an expensive undertaking that 25% of people (according to a worldwide survey from a consulting firm) would not consider. Another 50% would only spend money on efficiency if a return is expected within two years of the original purchase. This short timeframe is nearly unfeasible for big projects like a new water heater. The Outer Banks Brewery invested in a solar passive design and a wind turbine which will reduce energy costs, but it has taken more than two years for the owners to receive a monetary return on investment.

One solution for people’s unwillingness to invest in energy efficiency is to involve the utility companies. Duke energy has suggested helping homeowners invest in more efficient products for a small drawn-out fee. Energy efficiency may seem counter-intuitive for utility companies whose goal (as is the goal of all business) is to sell more products to make more money. New power plants, though, are very expensive (speaking of pricey long term investments), and decoupling could be a new norm. This is the practice of separating a utility company’s profits from its output sold with government intervention.

As always, the problem seems to reduce itself to money. People are unwillingly to make expensive investments in new efficient products (which is understandable), but hopefully other sources like utility companies and the government could help increase the incentive to buy a better air-conditioner. Of course, the most successful incentive would be a market that has been flooded with energy efficiency, so that prices for these products will align in a happy equilibrium of supply and demand.

http://www.nytimes.com/2007/05/29/business/29efficient.html?ref=energyefficiency&pagewanted=all

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