Lightening an Energy Load Requires a Ton of Work


by Ken Silverstein

Source: energybiz.com

Finding common ground on hot button energy issues has been a major impediment. But one area where policymakers are coming together is in the realm of energy efficiency, which is cost-effective while it is also reducing emissions and the reliance on electric generation.

Finding common ground on hot button energy issues has been a major impediment. But one area where policymakers are coming together is in the realm of energy efficiency, which is cost-effective while it is also reducing emissions and the reliance on electric generation. Some ideas:

In some jurisdictions across the country, customers can opt into real-time or time-of-use pricing programs, which is a step beyond energy conservation. Such programs allow users to adjust their usage, for example, from 3 p.m. to 7 p.m. during summer weekdays when the cost of electricity is highest. The smart grid has the potential to enable those policies to become a national movement.

If an industrial plant is flexible and can run key machinery at times when the electricity load overall is at its lowest ebb, then it could save a lot of money. Residential customers, on the other hand, would simply choose to run their dishwashers or washing machines at night to avoid being hit with higher costs.

The federal government is also facilitating and encouraging wise energy use, while simultaneously protecting the environment and conserving natural resources. Lower energy bills, of course, result in an increase in funds available for other critical purposes.

"Each and every individual action we take -- from turning off lights in unoccupied rooms to turning off computer monitors and computers, if possible -- adds up to a brighter future for us all," the Energy Department says.

Not everyone, however, thinks government is a necessary player when it comes to promoting energy efficiency. Sterling Burnett, with the National Center for Policy Analysis [3] in Dallas, has explained to this writer that if people want more energy-efficient household appliances or insulation systems, they can buy these products. But he is opposed to federal policies that would encourage such choices through tax incentives or mandates.

Nevertheless, the public sector is involved. And it has joined forces with the private sector. And even though the length of time to earn a return-on-investment for many energy efficiency technologies is sometimes short, such projects are often sidelined until homeowners or companies figure out ways to pay for them.

About $90 billion in federal stimulus has been used to advance energy efficiency programs. That includes everything from weathering homes to rolling out the smart grid that allows utilities and customers to work together to save energy.

Energy Efficiency Pays

A study called “The $20 Billion Bonanza" [4] was produced by the Southwest Energy Efficiency Project. It concludes that for every dollar invested in those efficiency programs, $2 in savings result for business and residential utility consumers. The report cites other benefits such as the avoidance of major capital expenditures associated with new power plants and even the retirements of some older and less efficient generators.

Meantime, some private consultancies are actively working with those businesses that want to reduce their energy consumption and cut their costs. Consider Metrus Energy [5]: The San Francisco-based business performs energy efficiency retrofits. After auditing the premises of large industrial and commercial customers, it will discuss the work that can be done and where the savings can be had. It will then fine-tune its ideas based upon what those businesses hope to achieve.

It may suggest simple solutions ranging from the installation of modern lighting and automatic controls to more complicated ones that involve the replacing of furnaces and boilers. After, it estimates both the costs and the potential savings. Metrus, which has worked with BAE Systems and Siemens, is paid on a per-units-of-electricity-avoided basis -- a formula that is derived in advance of any work.

"It's the best of times and the worst of times for energy efficiency," says Bob Hinkle, chief executive of Metrus, in an earlier talk with this writer. "It is the best of times because it is now well accepted as the right thing to do from an economic and environmental perspective. But it remains difficult to implement projects because capital is still constrained."

Energy efficiency is ready to become a central component of U.S. energy policy. To take off, however, technology developers must cope with a number of nuances that include everything from the allocation of limited federal resources to the type of oversight that will eventually apply to that business sector. In the end, increasing energy savings and reliability requires the same tenacity as does the exploration and generation of traditional fuel sources.