“A great book which should wake up humankind!” –Klaus Schwab, World Economic Forum
Chapter 4. Stabilizing Climate: An Energy Efficiency Revolution: The Energy Savings Potential
The goal for this chapter was to identify energy-saving measures that will offset the nearly 30 percent growth in global energy demand projected by the IEA between 2006 and 2020. My colleagues and I are confident that the measures proposed will more than offset the projected growth in energy use. 112
Shifting to more energy-efficient lighting alone lowers world electricity use by 12 percent. With appliances, the key to raising energy efficiency is to establish international efficiency standards that reflect the most efficient models on the market today, regularly raising this level as technologies advance. This would in effect be the global version of Japan’s Top Runner program to raise appliance efficiency.
Given the potential for raising appliance efficiency, the energy saved by 2020 should at least match the savings in the lighting sector. Combining more-efficient lights and appliances with a smart grid that uses time-of-day pricing, peak demand sensors, and the many other technologies described in this chapter shows a huge potential for reducing both overall electricity use and peak demand. 113
It is easy to underestimate the potential for reducing electricity use. Within the United States, the Rocky Mountain Institute calculates that if the 40 least efficient states were to achieve the electrical efficiency of the 10 most efficient ones, national electricity use would be cut by one third. This would allow the equivalent of 62 percent of all U.S. coal-fired power plants to be closed down. But even the most efficient states have a substantial potential for further reducing electricity use and, indeed, are planning to keep cutting carbon emissions and saving money. 114
In terms of transportation, the short-term keys to reducing oil use and carbon emissions involve shifting to highly fuel-efficient cars (including electric vehicles), diversifying urban transport systems, and building intercity rapid rail systems modeled on those in Japan and Europe. This shift from car-dominated transport systems to diversified systems is evident in the actions of hundreds of mayors worldwide who struggle daily with traffic congestion and air pollution. They are devising ingenious ways of limiting not only the use of cars but also the very need for them. As the urban car presence diminishes, the nature of the city itself will change.
Within the industrial sector, there is a hefty potential for reducing energy use. In the petrochemical industry, moving to the most efficient production technologies now available and recycling more plastic can cut energy use by 32 percent. Gains in manufacturing efficiency in steel can cut energy use by 23 percent. Even larger gains are within reach for cement, where simply shifting to the most efficient dry kiln technologies can reduce energy use by 42 percent. 115
With buildings—even older buildings, where retrofitting can reduce energy use by 20–50 percent—there is a profitable potential for saving energy. As noted earlier, such a reduction in energy use, combined with the use of renewable electricity to heat, cool, and light the building, means that it will be easier to create carbon-neutral buildings than we may have thought.
One simple way to achieve all these gains is to adopt a carbon tax that would help reflect the full cost of burning fossil fuels. We recommend increasing this carbon tax by $20 per ton each year over the next 10 years, for a total of $200 ($55 per ton of CO2), offsetting it with a reduction in income taxes. High though this may seem, it does not come close to covering all the indirect costs of burning fossil fuels. It does, however, encourage investment in both efficiency and carbon-free sources of energy.
In seeking to raise energy efficiency as described in this chapter, there have been some exciting surprises in the vast potential for doing so. We now turn to developing the earth’s renewable sources of energy, where there are equally exciting possibilities.
112. IEA, op. cit. note 17, p. 506.
113. IEA, World Energy Outlook 2006 (Paris: 2006), p. 492; IEA, op. cit. note 11, pp. 25, 29.
114. Natalie Mims, Mathias Bell, and Stephen Doig, Assessing the Electric Productivity Gap and the U.S. Efficiency Opportunity (Snowmass, CO: Rocky Mountain Institute, January 2009), pp. 6, 16–17.
115. Mandil et al., op. cit. note 76, pp. 39, 59–61, 95–96, 139–42.
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