American Society for Quality
32nd Energy & Environmental Conference
September 18-22, 2005, San Antonio, Texas, USA
Energy Efficiency/Conservation –
An Imperative to US
By
Sal Hassanien, PhD, P.E, CEM
Quality Manager
&
M. Saied Gouda, ,D.Eng, P.E
Director, EP&S
Energy Partnerships & Services
US Energy Consumption
August 2005
•
In the year 2003, the US energy consumption per day,
exceeded 320 billion kWh.
•
This is equivalent of the energy in 48.7 million barrels
of crude oil per day.
•
US burns 380 million U.S. gallons of gasoline per day.
•
Roughly half of the total energy consumption goes into
transportation.
•
US gets its energy from:
– 40% crude oil
– 23% natural gas
– 23% coal
– 8 % nuclear
– 6% renewable
DTE Energy Partnership & Services
2
0.06%
2.04%
0.54%
0.12%
% Of Total
Energy Used
2.7%
From: DOE/ Energy Information Administration/ Annual Energy Review 2003, page 276
0.24%
0.30%
August 2005
DTE Energy Partnership & Services
3
US Energy Imports
August 2005
•
Today US imports
– 54% of its crude oil from the Middle East
– 60% of its natural gas from Canada
•
The amounts and percentages of these imports are
predicted to increase to 68% for oil and 74% for gas, to
satisfy the increasing energy needs by 2010.
•
The price of barrel of crude oil has climbed to > $65/
barrel. The price may climb further due to increased
demand, especially from China, India and instability in the
Middle East. The predictions are that it will persist above
$50/barrel.
•
Similarly natural gas prices are expected to rise with the
rise of crude.
DTE Energy Partnership & Services
4
The Rising Oil Prices
•
Courtesy of the
Economist magazine.
•
The price of crude oil on
August 11 hit a new
record high of $66.15.
•
Continuing capacity
shortages in US
refineries, demand from
emerging economies, and
instability in the Middle
East will raise the price to
$ 70/ barrel or more.
August 2005
DTE Energy Partnership & Services
5
The Challenges
US is facing serious challenges, these are:
• US needs energy to maintain its standard of living.
Currently the needs far exceeds its domestic production?
August 2005
•
Energy demand by emerging economies like India &
China will continue to drive the price up.
•
US increased reliance on foreign energy imports raises
the issue of security of energy supply in the US.
•
Fossil fuels emissions are affecting the environment. US
produces 6 billion tons of Carbon Dioxide/year.
DTE Energy Partnership & Services
6
The Environmental Impact of Burning
Fossil Fuel
August 2005
•
The US population is less than 4% and it consumes 25%
of the total annual fossil fuel consumed in the world. US
also generates 20% of all gaseous emissions.
•
Fossil power plants similarly produce carbon dioxide, Sox
(Sulfur dioxides), Nox (Nitrous oxides) and mercury.
•
These emissions have profound impact on environment:
– Acid rain by sulfur oxides (Sox)
– Smog by nitrogen oxide & Ozone ( Nox)
– Ozone thinning
– Heavy metal dispersion e.g. mercury, lead
– Global warming due to carbon dioxide resulting in
climatic changes
•
Coal and Wood or Biomass burning produces the largest
emissions to the atmosphere.
DTE Energy Partnership & Services
7
The Environmental Impact of Burning
Fossil Fuel (cont.)
August 2005
•
The UN’s Inter-governmental Panel on Climate Change
(IPCC), made up of the world’s top climate scientists
(including prominent dissenters), concluded that man’s
generated greenhouse gases have “contributed
substantially to the observed warming over the last 50
years”.
•
Research from NASA, US blue ribbon Presidential Panel
and a multitude of research centers, around the world,
have all concluded that global warming, and the need to
prevent more damage to weather systems, are among the
most serious and pressing of the Earth's problems.
•
“If we don’t reduce greenhouse emissions, there will be
grave consequences within the lifetime of today's
generation of children.”
DTE Energy Partnership & Services
8
President Bush Energy Plan
•
•
•
•
August 2005
Signed into law last month.
Provides $11 billion net cost of the tax package plus the
$2 billion direct spending ,over 10 years, mostly as
subsidies for oil drilling offshore and on federal lands, and
for new coal fired and nuclear power plants.
Focused on increasing energy supply while doing little to
reduce demand, in terms of energy efficiency, it:
– Proposes tax credits for hybrid and fuel cell cars (up to
$2300 per vehicle)
– It proposes accelerated depreciation for co-generation
projects
– Expands energy star product labeling on appliances
While it provides incentives for the construction of a new
generation of nuclear power plants, it doesn't deal with the
unresolved long-term problem of nuclear waste.
DTE Energy Partnership & Services
9
President Bush Energy Plan (cont.)
•
•
•
•
•
August 2005
The energy plan does not make any significant attempt to
reduce the enormous automobile fuel demand that makes
this country so dependent on imported oil.
It does not promote nor improve energy efficiency
standards e.g. better gas mileage, better building codes.
It leaves out the whole question of reducing green house
gases. In fact, it relaxes the air emission standards and
will result in more greenhouse emissions from burning
more fossil fuel.
It does not provide significant incentives for R&D nor
promote the market for, energy efficiency technologies or
non polluting energy technologies like wind, solar and
bio-fuels.
It does not lower fuel prices anytime.
DTE Energy Partnership & Services
10
Energy Efficiency/ Conservation
•
•
•
•
With the right drivers ( Increasing
public awareness, tax incentives,
access to capital and credit, and high
energy prices), a nationwide energy
efficiency/ conservation program can
reduce energy consumption by 25%.
This saves
– equiv of 20.8 barrels of crude
oil/year.
– 1.5 billion tons/year of greenhouse
gas emissions
– $260B/year of crude imports
assuming a price of $50/barrel
Creates jobs in building and
engineering industries.
Stimulates new technological
development in Energy Efficiency (EE)
& alternative energy.
August 2005
DTE Energy Partnership & Services
11
Energy Efficiency/ Conservation Cost
vs. Savings
Financial Predictions
August 2005
300
250
200
150
100
50
0
Accumulative
Spending (B $)
20
16
20
14
20
12
20
10
Accumulative
Savings (B$)
20
08
20
06
– 5% reduction in energy
consumption every year
for five years.
– $50/ barrel of crude oil
– $10B investment in EE
every year for 5 years.
– 50% from private sources
and 50% from federal &
states.
$ (Billion)
Assumptions
Year
DTE Energy Partnership & Services
12
Energy Efficiency - transportation
The economically recoverable crude oil from US parklands
and artic national wildlife refuge is estimated to be 4 billion
barrels. The plan is to recover it over 20 years. It will
stretch US fuel supplies by 200 million barrels/year.
In comparison, making simple energy efficiency changes
in transportation can achieve a saving of 340 million
barrels of crude oil/year.
Furthermore, this will reduce greenhouse emissions and
Nox emitted from motor vehicles by approximately 25%.
August 2005
DTE Energy Partnership & Services
13
How to Improve Energy Efficiency in
Transportation?
August 2005
•
Increasing average new vehicle fuel economy standards
from the present 23 miles/gal to 40 mile/gal will save the
equivalent of 11% of the gasoline consumption (about 106
million barrel of crude oil year).
•
Adding 10-15% ethanol to gasoline will reduce gasoline
consumption by another 10% ( about 96 million barrel of
crude oil year).
•
Improving vehicle aerodynamics and/or replacing tires
with low rolling resistance tires with proper tire pressure
can cut fuel consumption by few percentages.
DTE Energy Partnership & Services
14
How to Improve Energy Efficiency in
transportation? (cont.)
August 2005
•
Further reduction by 5-20% of gasoline consumption (i.e.
about 48-192 million barrel of crude oil year) is possible If
we reduce rush hours and traffic bottlenecks (wasting
fuel).
•
Reducing mileage traveled by 10-15%. Annual Mileage
driven by family is >21,000/year. Telecommuting and
internet shopping can reduce this.
•
Improving public transportation in cities.
•
Bringing back an efficient and speedy railway system.
DTE Energy Partnership & Services
15
How to Improve Energy Efficiency in
Building Industry?
•
•
•
•
•
•
•
August 2005
Improving building codes as it relates to energy efficiency,
example building insulation and ventilation.
Reducing solar gain and heat escape by replacing old
windows with newer windows.
Replacement of heating system with high efficiency gas
furnaces.
Introducing district heating in high density commercial and
business buildings.
Increasing the efficiency of air-conditioning units by 30%.
Use energy management systems to monitor, shutdown
unnecessary loads and optimize energy consumption.
Changing from incandescent lighting to compact
fluorescent lamps will save the equivalent energy of ¼ ton
of coal over the lifetime of the lamp (20,000h).
DTE Energy Partnership & Services
16
How to Improve Energy Efficiency in
Industry?
– Recovery of waste energy.
– Improved industrial processes and process control,
especially in energy intensive industries like smelting,
metal, oil refining.
– High efficiency combustion.
– High efficiency boilers and heat exchangers.
– Eradicating steam and compressed air leaks.
– Energy management systems.
– Improved metering. Non-intrusive temp, pressure,
flow and energy measuring, metering devices.
August 2005
DTE Energy Partnership & Services
17
Providing Incentive for R&D in Energy
Efficiency
•
Provide R&D funding for positive energy efficiency
technologies such as:
– Energy Storage (batteries and thermal).
– AC/DC converters and invertors.
– Energy management systems that are simple and
cheep as a DVD player.
– Energy conversion/ extraction e.g. in power station
condensers.
– Higher efficiency appliances, motors and electrical
transformer.
August 2005
DTE Energy Partnership & Services
18
Providing Financial Incentive for
Energy Efficiency
August 2005
•
Provide tax incentives/faster depreciation for retrofitting
energy projects.
•
Provide low interest capital for energy projects
performance contracts.
•
Provide funding for massive and persistent media energy
awareness/education campaign.
•
Provide tax incentives to consumers buying energy
efficient appliances e.g. lights, digital energy management
systems, solar thermal heating systems, energy efficient
HVAC equipment like heat pumps, energy efficient
building insulating material and energy efficient windows.
DTE Energy Partnership & Services
19
Provide Incentive for R&D in Nonpolluting Energy Technologies
•
Provide R&D funding for non polluting energy sources
technologies such as:
– Wind turbines
– Photovoltaic solar technology
– Fuel cells
– Hydrogen
– Geothermal
August 2005
DTE Energy Partnership & Services
20
Integrating wind Power into the
Energy Mix
•
•
Today, Wind energy (non
polluting) is economically
competitive in terms of
installation and production
costs to other traditional
sources of energy.
This is not the case for
Photovoltaic Solar (c8) or
hydrogen( c40).
Energy Cost Comparison
Cost per kWh (cents)
•
22
25
20
15
10
5
5
5.5
6
6
Coal
Natural
Gas
Wind
Nuclear
0
Today , Wind power
provides 40% of Denmark’s
energy needs.
August 2005
Solar
Energy Source
DTE Energy Partnership & Services
21
Provide Incentive for R&D in Energy
Technologies
•
Provide R&D funding for improving energy technologies
such as:
– Combined cycle gas turbines.
– Safer nuclear reactors and nuclear waste disposal.
– Synthetic gas from coal.
– Bio-fuel e.g. gasohol, bio-diesel, methane from waste,
high pellets from agricultural waste.
– Distributed energy systems to reduce transmission
losses (presently @ 12%).
– Integrated energy systems e.g. co-generation, solar,
wind and thermal.
August 2005
DTE Energy Partnership & Services
22
Finally
•
•
•
•
•
•
•
August 2005
Energy Efficiency/ Conservation is the best option to satisfy US
energy needs for the short term, until other sources of energy
become available and economically viable.
25% energy savings is achievable with the present technology at
cheaper cost than prospecting for or adding new energy sources.
25% energy saving will not reduce the US standard of living or
comfort.
It reduces environmental emissions especially greenhouse gases
that can cause climatic changes.
It reduces the US reliance on foreign energy imports and reduces
concern with respect to the issue of security of energy supply.
It reduces the deficit in the trade balance of the US
Energy efficiency products, equipment, materials and retrofitting
will create business, job and export opportunities.
DTE Energy Partnership & Services
23
References
•
•
•
•
•
•
•
•
•
August 2005
CNN Inside Politics, Bush energy plan: Conservation, eased
regulations and diversification, May 17, 2005,
http://www.cnn.com/POLITICS/
The White House, President George W. Bush, Report of the National
Energy Policy, http://www.whitehouse.gov/energy/
A critique of Bush Energy Plan, May,2005, The National Resource
Defense Council
American Council For Energy Economic. www.aecee.org
Energy information on energy Consumption & energy information
statistics, Department of Energy, www.eia.doe.gov
Transportation energy data, www.cta.ornl,gov/data
Housing facts & figures and plans, National Association for Home
Builders, http://www.nahb.org/
The Economist Magazine, August 13,2005, another oil price record,
http://economist.com/
S.Hassanien, S. Gouda, The Necessity & Viability of Green Energy,
ASQ Conference, Seattle, 2005
DTE Energy Partnership & Services
24
THANK YOU
Questions?
Authors
Sal Hassanien, PhD, P.Eng, CEM. Presently the Quality Manager of Energy Partnership &
Services, DTE. He has Ph.D. Chemical Engineering from Canada. He is Registered Professional
Engineer, Certified Energy Manager, ISO900:2000 and ISO 14001 Lead Auditor, and an lecturer
on lean manufacturing. .He has 38 plus y experience in management & engineering and quality
improvement. He has been the Director & the President of Sustainable Development Technologies
Inc. an energy, environment and quality consulting firm.
The former Manager of Special Projects, Design Engineering, Nuclear, Ontario Power Generation.
He has been a Consultant to: UN Development Plan, UN Global Environmental Fund, Canadian
Ministry of Natural Resources & Mining, EEA Egyptian Environmental Authority. An Adjunct
Professor at Alexandria University. Sal has published more than a dozen technical papers. He has
delivered several seminar and training courses on quality and energy efficiency
Can be contacted at 2000 2nd Ave, 126o WCB, Detroit, MI 48226-9881,Tel: 313.235.8280, and Fax:
313.235.9601, email: hassaniens@dteenergy.com
Saied Gouda, Presently the Director of Energy Partnership & Services, DTE. He has a PhD
Mech. Eng, Detroit Univ. and he is a Registered Professional Engineer, Certified Manufacturing
Manager, Board Member of Registration & accreditation Board for ISI 14000 (RAB).
He has 15-years experience in management & engineering and quality assurance. He was the
Director of Quality Engineering assurance for Fermi 2 projects. He is an adjunct Prof. at Lawrence
Technical Univ.
Can be contacted at 2000 2nd Ave, 126o WCB, Detroit, MI 48226-9881,Tel: 313.235.5251, and Fax:
313.235.9601, email: goudam@dteenergy.com
August 2005
DTE Energy Partnership & Services
26