Why we never need to build another polluting power plant

Coal? Natural gas? Nuke? We can wipe them all off the drawing board by using current energy more efficiently. Are you listening, Washington?

Topics: Environment, Energy, Global Warming, Science,

Why we never need to build another polluting power plant

Suppose I paid you for every pound of pollution you generated and punished you for every pound you reduced. You would probably spend most of your time trying to figure out how to generate more pollution. And suppose that if you generated enough pollution, I had to pay you to build a new plant, no matter what the cost, and no matter how much cheaper it might be to not pollute in the first place.

Well, that’s pretty much how we have run the U.S. electric grid for nearly a century. The more electricity a utility sells, the more money it makes. If it’s able to boost electricity demand enough, the utility is allowed to build a new power plant with a guaranteed profit. The only way a typical utility can lose money is if demand drops. So the last thing most utilities want to do is seriously push strategies that save energy, strategies that do not pollute in the first place.

America is the Saudi Arabia of energy waste. A 2007 report from the international consulting firm McKinsey and Co. found that improving energy efficiency in buildings, appliances and factories could offset almost all of the projected demand for electricity in 2030 and largely negate the need for new coal-fired power plants. McKinsey estimates that one-third of the U.S. greenhouse gas reductions by 2030 could come from electricity efficiency and be achieved at negative marginal costs. In short, the cost of the efficient equipment would quickly pay for itself in energy savings.

While a few states have energy-efficiency strategies, none matches what California has done. In the past three decades, electricity consumption per capita grew 60 percent in the rest of the nation, while it stayed flat in high-tech, fast-growing California. If all Americans had the same per capita electricity demand as Californians currently do, we would cut electricity consumption 40 percent. If the entire nation had California’s much cleaner electric grid, we would cut total U.S. global-warming pollution by more than a quarter without raising American electric bills. And if all of America adopted the same energy-efficiency policies that California is now putting in place, the country would never have to build another polluting power plant.

How did California do it? In part, a smart California Energy Commission has promoted strong building standards and the aggressive deployment of energy-efficient technologies and strategies — and has done so with support of both Democratic and Republican leadership over three decades.



Many of the strategies are obvious: better insulation, energy-efficient lighting, heating and cooling. But some of the strategies were unexpected. The state found that the average residential air duct leaked 20 to 30 percent of the heated and cooled air it carried. It then required leakage rates below 6 percent, and every seventh new house is inspected. The state found that in outdoor lighting for parking lots and streets, about 15 percent of the light was directed up, illuminating nothing but the sky. The state required new outdoor lighting to cut that to below 6 percent. Flat roofs on commercial buildings must be white, which reflects the sunlight and keeps the buildings cooler, reducing air-conditioning energy demands. The state subsidized high-efficiency LED traffic lights for cities that lacked the money, ultimately converting the entire state.

Significantly, California adopted regulations so that utility company profits are not tied to how much electricity they sell. This is called “decoupling.” It also allowed utilities to take a share of any energy savings they help consumers and businesses achieve. The bottom line is that California utilities can make money when their customers save money. That puts energy-efficiency investments on the same competitive playing field as generation from new power plants.

The cost of efficiency programs has averaged 2 to 3 cents per avoided kilowatt hour, which is about one-fifth the cost of electricity generated from new nuclear, coal and natural gas-fired plants. And, of course, energy efficiency does not require new power lines and does not generate greenhouse-gas emissions or long-lived radioactive waste. While California is far more efficient than the rest of the country, the state still thinks that with an even more aggressive effort, it can achieve as much additional electricity savings by 2020 as it has in the past three decades.

Serious energy efficiency is not a one-shot resource, where you pick the low-hanging fruit and you’re done. In fact, the fruit grows back. The efficiency resource never gets exhausted because technology keeps improving and knowledge spreads to more people.

The best corporate example is Dow Chemical’s Louisiana division, consisting of more than 20 plants. In 1982, the division’s energy manager, Ken Nelson, began a yearly contest to identify and fund energy-saving projects. Some of the projects were simple, like more efficient compressors and motors, or better insulation for steam lines. Some involved more sophisticated thermodynamic “pinch” analysis, which allows engineers to figure out where to place heat exchangers to capture heat emitted in one part of a chemical process and transfer it to a different part of the process where heat is needed. His success was nothing short of astonishing.

The first year of the contest had 27 winners requiring a total capital investment of $1.7 million with an average annual return on investment of 173 percent. Many at Dow felt that there couldn’t be others with such high returns. The skeptics were wrong. The 1983 contest had 32 winners requiring a total capital investment of $2.2 million and a 340 percent return — a savings of $7.5 million in the first year and every year after that. Even as fuel prices declined in the mid-1980s, the savings kept growing. The average return to the 1989 contest was the highest ever, an astounding 470 percent in 1989 — a payback of 11 weeks that saved the company $37 million a year.

You might think that after 10 years, and nearly 700 projects, the 2,000 Dow employees would be tapped out of ideas. Yet the contest in 1991, 1992 and 1993 each had in excess of 120 winners with an average return on investment of 300 percent. Total savings to Dow from just those projects exceeded $75 million a year.

When I worked at the Department of Energy in the mid-1990s, we hired Nelson, who had recently retired from Dow, to run a “return on investment” contest to reduce DOE’s pollution. As they were at Dow, many DOE employees were skeptical such opportunities existed. Yet the first two contest rounds identified and funded 18 projects that cost $4.6 million and provided the department $10 million in savings every year, while avoiding more than 100 tons of low-level radioactive pollution and other kinds of waste. The DOE’s regional operating officers ended up funding 260 projects costing $20 million that have been estimated to achieve annual savings of $90 million a year.

Economic models greatly overestimate the cost of carbon mitigation because economists simply don’t believe that the economy has lots of high-return energy-efficiency opportunities. In their theory, the economy is always operating near efficiency. Reality is very different than economic models.

In my five years at DOE, working with companies to develop and deploy efficient and renewable technologies, and then in nearly a decade of consulting with companies in the private sector, I never saw a building or factory that couldn’t cut electricity consumption or greenhouse-gas emissions 25 percent to 50 percent with rapid payback (under four years). My 1999 book, “Cool Companies,” detailed some 100 case studies of companies that have done just that and made a great deal of money.

There are many reasons that most companies don’t match what the best companies do. Until recently, saving energy has been a low priority for most of them. Most utilities, as noted, have little or no incentive to help companies save energy. Funding for government programs to help companies adopt energy-saving strategies has been cut under the Bush administration.

Government has a very important role in enabling energy savings. The office of Energy Efficiency and Renewable Energy at the U.S. Department of Energy has lots of (underfunded) programs that deliver savings every day. Consider, for instance, Chrysler’s St. Louis complex, which recently received a DOE Save Energy Now energy assessment. Using DOE software, Chrysler identified a variety of energy-saving measures and saved the company $627,000 a year in energy costs — for an upfront implementation cost of only $125,000.

The key point for policymakers now is that we have more than two decades of experience with successful state and federal energy-efficiency programs. We know what works. As California energy commissioner Art Rosenfeld — a former DOE colleague and the godfather of energy efficiency — put it in a recent conversation, “A lot of technology and strategies that are tried and true in California are waiting to be adopted by the rest of country.”

So how do we overcome barriers and tap our nearly limitless efficiency resource? Obviously, the first thing would be to get all the states to embrace smarter utility regulations, which is a core strategy of Barack Obama’s plan to reduce greenhouse gases. But how does the federal government get all the states to embrace efficiency?

We should establish a federal matching program to co-fund state-based efficiency programs, with a special incentive to encourage states without an efficiency program to start one. This was a key recommendation of the End-Use Efficiency Working Group to the Energy Future Coalition, a bipartisan effort to develop consensus policies, in which I participated. The first year should offer $1 billion in federal matching funds, then $2 billion, $3 billion, $4 billion, and finally stabilizing at $5 billion. This will give every state time to change their regulations and establish a learning curve for energy efficiency.

This program would cost $15 billion in the first five years, but save several times that amount in lower energy bills and reduced pollution. Since the next president will put in place a cap-and-trade system for greenhouse gases, the revenues from auctioning the emissions permits can ultimately be used to pay for the program.

We should restore a federal focus on the energy-intensive industries, such as pulp and paper, steel, aluminum, petroleum refining and chemicals. They account for 80 percent of energy consumed by U.S. manufacturers and 90 percent of the hazardous waste. They represent the best chance for increasing efficiency while cutting pollution. Many are major emitters of greenhouse gases other than carbon dioxide. A 1993 analysis for the DOE found that a 10 to 20 percent reduction in waste by American industry would generate a cumulative increase of $2 trillion in the gross domestic product from 1996 to 2010. By 2010, the improvements would be generating 2 million new jobs.

For these reasons, in the 1990s, the Energy Department began forming partnerships with energy-intensive industries to develop clean technologies. We worked with scientists and engineers to identify areas of joint research into technologies that would simultaneously save energy, reduce pollution and increase productivity. The Bush administration slashed funding for this program by 50 percent — and keeps trying to shut it down entirely.

Indeed, conservatives in general have cut the funding or shut down entirely almost all federal programs aimed at deploying energy-efficient technologies. Conservatives simply have a blind spot when it comes to energy efficiency and conservation, seeing them as inconsequential “Jimmy Carter programs.”

I recently testified at a Senate Environment and Public Works Committee hearing on nuclear power and spoke about how alternative technologies, particularly energy efficiency, were a much better bet for the country. Senator George Voinovich (R-Ohio) said this was “poppycock,” and then asked all the pro-nuclear witnesses to address the question, “If nuclear power is so uncompetitive, why are so many utilities building reactors?”

Voinovich apparently has forgotten about the massive subsidies he himself voted to give the nuclear industry in 2005. He seems to be unaware that states like Florida allow utilities to sharply raise electric rates years in advance of a nuclear plant delivering even a single electron to customers. If you could do that same forward-pricing with energy efficiency, we would never need to build another polluting plant.

Although he is a senior member of the Senate and a powerful voice on energy and climate issues, Voinovich doesn’t seem to know the first thing about the electricity business; namely, that a great many utilities have a huge profit incentive to build even the most expensive power plants, since they can pass all costs on to consumers while retaining a guaranteed profit. But they have a strong disincentive from investing in much less costly efforts to reduce electricity demand, since that would eat into their profits.

The next president must challenge the public service commission in every state to allow utilities to receive the same return on energy efficiency as they are allowed to receive on generation. That single step could lead the country the furthest in solving our ever-worsening climate and energy problems.

Joseph Romm is a senior fellow at the Center for American Progress, where he oversees ClimateProgress.org. He is the author of "Hell and High Water: Global Warming -- The Solution and the Politics." Romm served as acting assistant secretary of energy for energy efficiency and renewable energy in 1997. He holds a Ph.D. in physics from MIT.

More Related Stories

Featured Slide Shows

  • Share on Twitter
  • Share on Facebook
  • 1 of 11
  • Close
  • Fullscreen
  • Thumbnails

    Ten spectacular graphic novels from 2014

    Beautiful Darkness by Fabien Vehlmann & Kerascoët
    Kerascoët's lovely, delicate pen-and-watercolor art -- all intricate botanicals, big eyes and flowing hair -- gives this fairy story a deceptively pretty finish. You find out quickly, however, that these are the heartless and heedless fairies of folk legend, not the sentimental sprites beloved by the Victorians and Disney fans. A host of tiny hominid creatures must learn to survive in the forest after fleeing their former home -- a little girl who lies dead in the woods. The main character, Aurora, tries to organize the group into a community, but most of her cohort is too capricious, lazy and selfish to participate for long. There's no real moral to this story, which is refreshing in itself, beyond the perpetual lessons that life is hard and you have to be careful whom you trust. Never has ugly truth been given a prettier face.

    Ten spectacular graphic novels from 2014

    Climate Changed: A Personal Journey Through the Science by Philippe Squarzoni
    Squarzoni is a French cartoonist who makes nonfiction graphic novels about contemporary issues and politics. While finishing up a book about France under Jacques Chirac, he realized that when it came to environmental policy, he didn't know what he was talking about. "Climate Changed" is the result of his efforts to understand what has been happening to the planet, a striking combination of memoir and data that ruminates on a notoriously elusive, difficult and even imponderable subject. Panels of talking heads dispensing information (or Squarzoni discussing the issues with his partner) are juxtaposed with detailed and meticulous yet lyrical scenes from the author's childhood, the countryside where he takes a holiday and a visit to New York. He uses his own unreachable past as a way to grasp the imminent transformation of the Earth. The result is both enlightening and unexpectedly moving.

    Ten spectacular graphic novels from 2014

    Here by Richard McGuire
    A six-page version of this innovative work by a regular contributor to the New Yorker first appeared in RAW magazine 25 years ago. Each two-page spread depicts a single place, sometimes occupied by a corner of a room, over the course of 4 billion years. The oldest image is a blur of pink and purple gases; others depict hazmat-suited explorers from 300 years in the future. Inset images show the changing decor and inhabitants of the house throughout its existence: family photos, quarrels, kids in Halloween costumes, a woman reading a book, a cat walking across the floor. The cumulative effect is serene and ravishing, an intimation of the immensity of time and the wonder embodied in the humblest things.

    Ten spectacular graphic novels from 2014

    Kill My Mother by Jules Feiffer
    The legendary Pulitzer Prize-winning cartoonist delivers his debut graphic novel at 85, a deliriously over-the-top blend of classic movie noir and melodrama that roams from chiaroscuro Bay City to Hollywood to a USO gig in the Pacific theater of World War II. There's a burnt-out drunk of a private eye, but the story is soon commandeered by a multigenerational collection of ferocious women, including a mysterious chanteuse who never speaks, a radio comedy writer who makes a childhood friend the butt of a hit series and a ruthless dame intent on making her whiny coward of a husband into a star. There are disguises, musical numbers and plenty of gunfights, but the drawing is the main attraction. Nobody convey's bodies in motion more thrillingly than Feiffer, whether they're dancing, running or duking it out. The kid has promise.

    Ten spectacular graphic novels from 2014

    The Motherless Oven by Rob Davis
    This is a weird one, but in the nervy surreal way that word-playful novels like "A Clockwork Orange" or "Ulysses" are weird. The main character, a teenage schoolboy named Scarper Lee, lives in a world where it rains knives and people make their own parents, contraptions that can be anything from a tiny figurine stashable in a pocket to biomorphic boiler-like entities that seem to have escaped from Dr. Seuss' nightmares. Their homes are crammed with gadgets they call gods and instead of TV they watch a hulu-hoop-size wheel of repeating images that changes with the day of the week. They also know their own "death day," and Scarper's is coming up fast. Maybe that's why he runs off with the new girl at school, a real troublemaker, and the obscurely dysfunctional Castro, whose mother is a cageful of talking parakeets. A solid towline of teenage angst holds this manically inventive vision together, and proves that some graphic novels can rival the text-only kind at their own game.

    Ten spectacular graphic novels from 2014

    NOBROW 9: It's Oh So Quiet
    For each issue, the anthology magazine put out by this adventurous U.K.-based publisher of independent graphic design, illustration and comics gives 45 artists a four-color palette and a theme. In the ninth issue, the theme is silence, and the results are magnificent and full of surprises. The comics, each told in images only, range from atmospheric to trippy to jokey to melancholy to epic to creepy. But the two-page illustrations are even more powerful, even if it's not always easy to see how they pertain to the overall concept of silence. Well, except perhaps for the fact that so many of them left me utterly dumbstruck with visual delight.

    Ten spectacular graphic novels from 2014

    Over Easy by Mimi Pond
    When Pond was a broke art student in the 1970s, she took a job at a neighborhood breakfast spot in Oakland, a place with good food, splendid coffee and an endlessly entertaining crew of short-order cooks, waitresses, dishwashers and regular customers. This graphic memoir, influenced by the work of Pond's friend, Alison Bechdel, captures the funky ethos of the time, when hippies, punks and disco aficionados mingled in a Bay Area at the height of its eccentricity. The staff of the Imperial Cafe were forever swapping wisecracks and hopping in and out of each other's beds, which makes them more or less like every restaurant team in history. There's an intoxicating esprit de corps to a well-run everyday joint like the Imperial Cafe, and never has the delight in being part of it been more winningly portrayed.

    Ten spectacular graphic novels from 2014

    The Shadow Hero by Gene Luen Yang and Sonny Liew
    You don't have to be a superhero fan to be utterly charmed by Yang and Liew's revival of a little-known character created in the 1940s by the cartoonist Chu Hing. This version of the Green Turtle, however, is rich in characterization, comedy and luscious period detail from the Chinatown of "San Incendio" (a ringer for San Francisco). Hank, son of a mild-mannered grocer, would like to follow in his father's footsteps, but his restless mother (the book's best character and drawn with masterful nuance by Liew) has other ideas after her thrilling encounter with a superhero. Yang's story effortlessly folds pathos into humor without stooping to either slapstick or cheap "darkness." This is that rare tribute that far surpasses the thing it celebrates.

    Ten spectacular graphic novels from 2014

    Shoplifter by Michael Cho
    Corinna Park, former English major, works, unhappily, in a Toronto advertising agency. When the dissatisfaction of the past five years begins to oppress her, she lets off steam by pilfering magazines from a local convenience store. Cho's moody character study is as much about city life as it is about Corinna. He depicts her falling asleep in front of the TV in her condo, brooding on the subway, roaming the crowded streets after a budding romance goes awry. Like a great short story, this is a simple tale of a young woman figuring out how to get her life back, but if feels as if it contains so much of contemporary existence -- its comforts, its loneliness, its self-deceptions -- suspended in wintery amber.

    Ten spectacular graphic novels from 2014

    Through the Woods by Emily Carroll
    This collection of archetypal horror, fairy and ghost stories, all about young girls, comes lushly decked in Carroll's inky black, snowy white and blood-scarlet art. A young bride hears her predecessor's bones singing from under the floorboards, two friends make the mistake of pretending to summon the spirits of the dead, a family of orphaned siblings disappears one by one into the winter nights. Carroll's color-saturated images can be jagged, ornate and gruesome, but she also knows how to chill with absence, shadows and a single staring eye. Literary readers who cherish the work of Kelly Link or the late Angela Carter's collection, "The Bloody Chamber," will adore the violent beauty on these pages.

  • Recent Slide Shows

Comments

0 Comments

Comment Preview

Your name will appear as username ( settings | log out )

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>