Friday, March 2, 2012

Energy Efficiency & Sustainability: Pathways to prosperity

My father was a government employee whose paycheck didn't have much wiggle room. He saved money by cutting my hair himself - he wasn't a very good barber - and by constantly reminding us to turn off lights.

He quit giving me bowl cuts when I became a preteen and my mother said it was embarrassing. But he never stopped harping about power consumption. "You're wasting electricity," he would say. "You think I'm made of money?"

I didn't care. I never saw the power bills, and had no clue. I just rolled my eyes and switched off the lights.

Today, 45 years later, I totally understand. Dad was only interested in the power consumption of the house we rented on Indio Drive near Pismo Beach. It would be a different story today; People and businesses everywhere are finally realizing that wasting electricity is stupid and costly.

The Rockefeller Foundation and Deutsche Bank have found that replacing outdated power-sucking equipment in buildings nationwide could save more than $1 trillion over 10 years, which is equivalent to slashing the nation's annual electricity bill by 30% .

After all, buildings consume 40% of all the power globally and are responsible for 40% of global carbon emissions. Simple changes such as replacing lights and heating and air conditioning equipment can yield significant savings. The joint study (click here) found that $279 billion in retrofit investments would save at least $1 trillion in the U.S. over just 10 years. That's a return on investment of 36%. Not bad.

The report is the latest in a string that basically echo the same theme. This one from American Council for an Energy-Efficient Economy says an energy-efficiency campaign could save $16 trillion through 2050.

"Upgrading and replacing energy-consuming equipment in buildings offers an important capital investment opportunity, with the potential for significant economic, climate, and employment impacts," the Rockefeller/Deutsche report says.

And that doesn't include the jobs potential, which could total in the millions over that decade, or the estimated 10% reduction in total greenhouse gas emissions, the report contends.

Takes green to get green

Of course, retrofits cost money, and that is always the problem. Property owners have to spend money to save money, but the payback can be pretty swift for those who do it. Investments in lighting can be recouped in one to two years, while the purchase and installation of a fancy new boiler might take six years to recoup.

That's where financing comes in, and where the study goes into great detail. Financing mechanisms - such as on-bill financing, property tax programs and energy service agreements - are at work in various places, and other options are being explored.

They are being explored, in part, because cities and states are imposing stricter policies. New disclosure and benchmarking laws, such as those in New York and California, could spark new programs.

Bullet train to efficiency

In fact, many companies, local governments and, as this video from Clemson University shows, students (campuses hold tremendous opportunities to save money) are moving energy efficiency to the fast track. In some cases, it is more like a bullet train. Our nonprofit is helping more than three dozen cities and counties in the San Joaquin Valley use stimulus money to replace lights, pump motors and other energy hogs. The estimated energy savings could total around 5.4 million kilowatt hours. Those cities and counties are saving energy and money - and even jobs.

Similar stories abound. There is this one out of Australia, while closer to home AT&T, IBM and the owner of the iconic Empire State building experienced significant savings through energy efficiency. Read more here.

Those businesses are finding that efficiency is only one part of an overall sustainability program that can save money. Walmart became a believer when it discovered that shrinking the package on a toy leads to more packages in a truck which, in turn, leads to fewer truck miles and, eventually, less consumption of fuel - and major cost savings.

Just yesterday, Kaiser said it wants to reduce its carbon footprint 30% by 2020. The health care giant linked greenhouse gas emissions to climate change and the rise of pollution and disease. "Kaiser Permanente is committed to creating healthy communities, and it's critical we work to reduce the impact of our operations on the environment," said Bernard Tyson, president and chief operating officer.

The federal government has recognized the sustainability movement by bestowing 20 Climate Leadership Awards on 20 organizations and individuals. They include IBM, Campbell Soup Company, Cummins Inc., UPS, Intel and others.

The awards recognize corporate, organizational, and individual leadership in addressing climate change and reducing carbon pollution. "From setting and exceeding aggressive emissions reduction goals to reducing the emissions associated with shipping goods, these organizations are improving efficiency, identifying energy and cost saving opportunities, and reducing pollution," the EPA announced.

Saving money. Helping the environment. Creating jobs. Sustainability makes sense in so many ways.

Video: From Clemson University

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