energy11 energy efficiency power point

8/3/2019 ENERGY11 Energy Efficiency Power Point

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November 7, 2011

10.0 Energy Efficiency andEnergy Conservation


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Sustainable Energy Technology:Market Pull and Technological Push

Market mechanism alone cannot stimulatethe development and deployment of energytechnologies fast enough to meet the urgent

national need

While the market pull tends to favorincremental innovation, the technological

push favors radical innovation. In a complex

sector like energy, new innovation will requirea system of both models: a technology strategy

and a pricing program

(Weiss and Bonvillian, 2009)


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Promising Energy TechnologiesSustainable energy technologies include wind-electricand solar photovoltaics. In addition:

LEDs, replacing incandescent and fluorescent bulbs(converts electric voltage into light)

Enhanced geothermal energy (inserts water into dry,hot subterranean rocks)

Carbon capture and sequestration (stores carbon in

saline aquifers or under the seabed) Improved battery technology (new lithium ion batteries

with nanotechnology to be cheaper, lighter, andmore powerful)

(Weiss and Bonvillian, 2009)


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Power from Perspective:

U.S. Energy Portfolios

Brainstorming session of ten policy experts Shaped into seven distinct perspectives (mindsets) Each perspective weights over 14 defining values and

build its own national energy portfolio

Including conventional and alternative energy sources Portfolio evaluation criteria (primary: energy

independence, energy security, and GHGreductions; secondary: economic growth,

technical feasibility, etc.) Commonalities among the portfolios to meet year

2030 energy demands: cellulosic ethanol, nuclearpower, andenergy efficiency

(Tonn et al., 2009)


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Policy InterventionsThe most important lessons is that public policies

that are well-designed and implemented canovercome the barriers to greater efficiency,renewable energy use, and cleaner fossil fuel

technologies

Transforming markets Innovation system for clean energy technologies Make policies predictable and stable RD&D, not just technology, but behavioral change Convenient financing and financial incentives No subsidies and internalizing externality Regulations or market obligations, etc. Information dissemination and training

(Geller, 2004)


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Global Clean Energy Scenario Energy Demand about 0.6% per Year Renewable Supply about 2.5% per year

One-Quarter of Energy Supply by 2020

Over Half by 2050All Energy Supply by 2100

Nuclear energy is phased out within 50 years Coal use is phased out in about 60 years Oil Use in about 90 years

Natural gas use is phased out by 2100(Geller, 2004)


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Efficiency and Conservation:

Examples (Andrew Rudin)

Improved Efficiency

More miles per gallon of gasoline

More lumens per watt

Occurs only while using energy

Suggests no change in lifestyle

Provided mostly by specialists

Dependent on energy suppliers

Mostly technical

Promotes growth

Conservation

Driving less; using fewer total

gallonsLess artificial lighting

Occurs while not using energy

Questions need for end uses

Provided mostly by end users

Creates independence from

suppliers

Mostly behavioral

Promotes sustainability


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Efficiency-Input and

Conservation-Output

Demand for Electricity: Derived demandDont desire energy for its own sake, but

demand the good or service (output) that theelectricity (input) provides. For example; you desire music from your stereo

(output) this requires electricity (input)

Efficiency focuses on adjusting the inputrequirement for a particular service.

Conservation focuses on output decisions(Croucher, 2011)


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Conservation: Lifestyle

Socolow studies identical houses to show that the

occupants were responsible for most ofthe variation in energy use

Efficiency takes ratepayers off the hook by putting the

responsibility on technology rather than on personalpreferences. A big mistake

Smil says that Americans wont accept lower-energy

lifestyles. I disagree with himUsing less energy is inherently beautiful, full of grace

and more respectful of our environment

(Rudin, 2004)


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Energy Star CFL

75% less energy and last up to 10 times (4 to 5 times)longer than incandescent (standard) bulbs

Replacing one light bulb with a CFL:

Light more than 3 million homes for a year Save more than $600 million in annual energy costs Prevent GHG equivalent to the emissions of more

than 800,000 cars.

(DOE: Change a Light, Change the World Campaign, 2007)


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Retrofit of

Typical Motor-Pump System


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An Economic Advantage of

Reduced Energy Consumption

The United States used 10% of its GNP to paythe national fuel bill, but

Japan used only 4% The difference was $200 billion that the U.S.did not have available to

invest in other areas

As a result, the average Japanese product hasan automatic cost advantage of about 5% in

the U.S. market


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Estimated Average Electricity SavingsPotential for

a Typical House in Austin, Texas


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Zero Energy Buildings

By 2050, new buildings will consume zero netenergy from external power supplies and

produce zero net CO2 emissions

To achieve those goals, the buildings will requirea combination of onsite power generation and

ultra-efficient building materials and

equipmentWorld Business Council for Sustainable Development

(WBSCD)


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Zero Energy Buildings:

New Jersey

The demonstration home is 80% moreenergy efficient than conventionally

built homes

The home combines energy efficient design

and radiant floor heating with 2.5 kW PVsystem and a 4 kW solar thermal system

(DOE Newsletter, 2006)


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Industrial Cogeneration

A recent study done for EPA has estimated that 96

GW of electric power could be provided in the U.S. byrecycling industrial waste heat in 19 industries. This

would amount to 11.5% of current generatingcapacity in the U.S.(Ayres et al., 2007)

The U.S. market could pass that for nuclear power,reaching 100,000 MW,

equivalent to 15% of the U.S. power supply(Applied Energy Services)


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Cogeneration Schematic


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Fuel Economy

Raising the CAF standard to 50 milesper gallon would save at least 2 to 3

million barrels a day(Guterl)

Improving the average fuel efficiency ofvehicles in the United States by 2.7 miles

per gallon would equal all U.S. oilimports from the Persian Gulf(Lovins quoted in Fred Guterl)


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Estimates of Energy Required by

Various Modes


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Alternative Fuel Vehicle

Improvements in fuel economy alone cannotsolve the problems of oil availability andclean air

Equally important in the long run is the use of

alternative fuels, preferably thoseproduction and combustion add no netcarbon dioxide to the atmosphere

Only three fuels meet this ideal criterion:hydrogen (non-fossil fuels); biomass

(photosynthetic offset); and electricity(non-fossil fuels)

(Ayres, et al., 2007)


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Cost-effective Energy Savings Potential


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The Activities involved in

Integrated Resource Planning


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Targeted DSM

In a competitive environment, it is necessary to change the focusto targeting DSM programs that address not only generationneeds but T&D problems as well

(Byrne and Wang et al.)

Other name is demand-response programs. Demand-responseprograms (initiatives to reduce electricity use during peakdemand periods) could improve the reliability of the electricitysystem

(Government Accountability Office, 2004)

Energy savings are most important in evaluating efficiencyinvestments while peak load reduction is the most important in

evaluating demand response(Spees et al., 2007)


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Demand Response Programs

The Energy Independence and Security Act of 2007 requires theFERC to conduct a National Assessment of demand response

potential and report to Congress

The peak demand without any demand response is estimated togrow at an annual average growth rate of 1.7 percent,reaching approximately 950 GW by 2019 (BAU)

Under the highest level of demand response, it is estimated thatthe 2019 peak load could be reduced by as much as 150 GW,compared to the BAU

A typical peak power plant is about 75 MW, so this reductionwould be equivalent to the output of about 2,000 such power

plants

(Rattle Group, 2009)

L D t li d


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Large vs. Decentralized

Combined Heat and Power (DCHP)

A new large plant can be built for fewer dollars per kWof generating capacity, but it applies only to capitalcost for the plant itself, not the fuel and not

transmission and distribution (T&D)A recent study by the Carnegie-Mellon Center for

Electric Industry Analysis shows that a system basedon many decentralized generation units located nearusers can achieve desired reliability with only 5%

reserve margin, rather than the standard 15%margin

(Ayres, et al. 2007)


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Decentralized

Combined Heat and Power (DCHP)

The U.S. will need 137 GW of new capacity by 2010,

costing $84 billion, plus $220 billion for additionalT&D. Casten has estimated that meeting this demand

with DCHP would cost only $168 billion, with noadditional needs for T&D

CHP accounts for over 50% of the electric power

generated in Denmark; 39% in the Netherlands; 37%in Finland and 31% in Russia; Germany gets 19%and Poland, Japan and China are at 18%

(Ayres, et al. 2007)

R i i


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Remaining

Energy Efficiency Potential

A very substantial technical, economic and achievableenergy efficiency potential remains available in theU.S.

Considerable opportunities still exist to achieve cost-effective savings via energy efficiency policy. Energyefficiency policy clearly represent more of a pipelineto the future than a pipe dream

The set of socially cost-effective opportunities is evenhigher than suggested by the estimates which focusonly on the private returns

(Tietenberg, 2009)


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Efficiency Technologies:

EPRI vs. RMI


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Criticism on RMI Estimates

The RMI curve indicates a 75% efficiencyincreases at an average cost ofonly 0.6 cent per kWh saved

Energy savings are overestimated, while costsare underestimated

Free rider issues are not considered It is not reflected the fact that the ratio of

measured to projected (engineering)savings was 63%

AEEI was not considered

(Joskow and Marran)


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A Schematic Supply Curve of

Conserved Energy


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Cost of Conserved Energy:

The Formula

Th P d f Effi i


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The Paradox of Efficiency

Curtail in the short term, but long-term impacts are

opposite New uses multiply faster than the old ones get

retrofitted: Efficiency is improved at the margin More efficient means faster, more miles traveled, and

more energy consumption Knowledge-intensive goods grows faster, but does not

reduce energy consumption New forms of demand materialized around the new

fuels (coal: steam engines, electric power plants) The better energy extracting technology, the cheaper

the energy, and we consume more of them(Huber and Mills, 2005)


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Self-Deception:

Efficiency with Reduction

Technological efficiency alone offsets continued growth in energyservices (Refutation: reduction only come about by reining inthe demand for energy services)

De-coupling between energy consumption and GDP (Refutation:

growth in activities pushes energy consumption upwards)Technological Efficiency Trap

A larger house consumes more energy for space heating, but lessenergy per square meter (Geometric Effects)

The larger economy, the more energy efficient (due to economy ofscale and structural change), but a bigger economy is moreenergy consuming

(Wilhite and Norgard, 2004)


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Rebound Effect

Stanley Jevons (The Coal Question, 1865) is thefirst person who recognized the rebound effect


The direct rebound effect is the increased use ofenergy services induced by the reduction in their price

due to greater efficiency

The indirect rebound effect is caused by the reduction

in the cost of energy services, so the consumer has alittle more money to spend on all goods and services

(Herring, 2006)


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Magnitude of Rebound Effect

Argument that the direct rebound effect willlead to a net increase in energy use appear to begrossly exaggerating the magnitude of the

phenomenon (Geller and Attali, 2005) Some rebound effect is a fact, but probably less

than 20% of the savings

(Wilhite and Norgard, 2004) The rebound effect is minimala loss of no

more than 1 or 2% of the direct energy savings

(Geller and Attali, 2005)


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Efficiency with Sufficiency

An increase in resource efficiency alone leadsto nothing, unless it goes hand in hand with

an intelligent restraint of growth(Sachs, 1988)

The full direct savings from more efficienttechnology could be realized if the goalwas to provide for people a certainsufficient amount of energy services, andthen level off


R d i R b d Eff t


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Reducing Rebound Effect

Combining efficiency of technology with sufficiency in

energy services (Wilhite and Norgard, 2004) Carbon taxes and combined policy of green electricity

(renewables) and energy efficiency (Herring, 2006) Reinvestment in natural capital rehabilitation

(Wackernagel and Rees, 1997) Moral restraint and cultural change (wasteful life

style) (Rudin, 1999) Less working hours and more leisure (Wilhite and

Norgard, 2004)

Invest the savings from the lower energy bill in evenless energy intensive forms for providing energy

services, such as passive space heat and coolingdesigns for buildings (Wilhite and Norgard, 2004)


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South Koreas Energy Consumption and

CO2 Emissions in 2020


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A Supply Curve of Avoided CO2 Emissions

in South Korea


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Nuclear Moratorium through Energy

Efficiency Improvements

Energy Options FullImplementation

(100%)

Major PolicyCommitment

(65%)New Nuclear PlantCapacity

Energy Efficiency

Improvements

Increased LNG CapacityFactor

30.3 MTOE (121.2TWh)

33.6 MTOE (149.5

TWh)

None

30.3 MTOE (121.2TWh)

21.8 MTOE (97.2 TWh)

28% 38.8% toprovide 24.0TWh

Energy Efficiency Gap


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Energy Efficiency Gap

There is a relatively low penetration rate for apparently

cost-effective energy efficiency technologies Typically wait for when replacement decisions must be made

Standard new model is more efficient than what people are usedto and costs less than the high efficient model

Applying higher implicit discount rates than in NPV calculationof a given option

Uncertainty about actual future savings

Indecision about when to invest: current product or wait for the

next generation Lack of information, loss aversion (greater from a loss than

from an expected gain), liquidity constraints (lack of access tocredit markets), and principle/agent problem (landlord/tenant)

(Croucher, 2011)


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Conservation Gap

Vampire lossesLeaving things in standby mode (Laptops, TV,

phone charges plugged in)

22% of US households had 2 refrigerators Old one is typically between 10-19 years old When update appliances, people dont always

decommission the old ones

PCs in 68% of households 17% leave on when not using, 26% in sleep

mode(Croucher, 2011)

Di t d I t l F t


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Direct and Internal Factors

Affecting Efficiency Decisions of

Energy Sectors


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Institutions Influencing Efficiency

Decisions of Energy Sectors


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Energy Efficiency Policies:

Appropriate pricing (correct price signals) is a necessary

condition for promoting energy efficiency Energy efficiency institutions (including co-ordination at

international level) Quantitative targets for energy efficiency improvements with

generally annual monitoring requirement Regulations (mandatory use of solar water heaters in Spain;phase-out of use of incandescent lamps in Australia)

Energy efficiency certificates for existing buildings Labeling and standards for electrical appliances

Financial incentives (including tax incentives) Mandatory audits Fully informing consumers about energy efficiency actions

(SEU, ESCOs) Car purchase taxes, fuel taxes, and efficiency obligations for

utilities (WEC, 2008)

Ranking (Scorecard) of


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a g (Sco eca d) o

State Energy Efficiency Policies (2009)

Ranking of U.S. states according to adoption andimplementation of energy efficiency policies

Six energy efficiency policy areas: Utility-sector and public benefits programs and policies

Transportation policies Building energy codes Combined heat and power State government initiatives Appliance efficiency standards

The top 10 states: CA, MA, CN, OR, NY, VT, WA, MN, RI, ME

The score improved from 15 to 17 points (8 spots from last year):ME, CO, Delaware, DC, SD, TN

(ACEEE, 2009)

Ranking (Scorecard) of


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g ( )

State Energy Efficiency Policies (2010)

Ranking of U.S. states according to adoption andimplementation of energy efficiency policies

Six energy efficiency policy areas: Utility-sector and public benefits programs and policies

Transportation policies Building energy codes Combined heat and power State government initiatives Appliance efficiency standards

The top 10 states: CA, MA, OR, NY, VT, WA, RI, CN, MN, METhe bottom 10 states: AK, LA, OK, MS, WV, KS, NV, WY, MI, ND

NH (22), NJ (12), DE (27), DC (19), MD (16), PA (16)

(ACEEE, 2010)


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Energy and Water: Washers

Inefficient washers will waste preciouswater resourcesabout 14 trilliongallons cumulatively by 2030

Thats enough drinking water to supply thecurrent usage of all U.S. householdsfor a year and a half!

Todays washers using new technology(horizontal-axis) consume about 40% lessenergy than todays most common models


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Copenhagen Conference

Negotiators meeting in Barcelona for thelast round of UN climate talks before abig conference in Copenhagen (COP-15)

in December 2009 are working onnegotiation texts that have no reference towater and its management as tools for

climate change adaptation(Stockholm International Water Institute, 2009)


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Consortium for Energy Efficiency

At the end of 2010, twenty-six U.S. stateshave introduced some form of an energy

efficiency standard/goal for regulatedelectricity utilities.In 2007 $2.7 billion (rebate) was allocated to

encourage the adoption of energy efficiencymeasures. Whilst in 2010 it is expected to be$5.4 billion

energy11 energy efficiency power point

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