Energy Efficiency
Lessons Learnt from the US
Arun Majumdar
Stanford University
Actual Path of US Energy Consumption
200
180
Quadrillion Btu
160
140
120
100
Total Energy
Consumed
80
60
40
20
Data Source: EIA, Monthly Energy Review
0
1950
1955
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
3
Actual vs No-Energy-Efficiency Trends
200
180
Data Source: EIA, Monthly Energy Review
Quadrillion Btu
160
Total Energy Under
Previous Trend -0.55% per year
less than GDP Growth
Energy
Efficiency
Impacts
($100s Billion)
140
120
100
80
Total Energy
Consumed
60
US Energy use in 2014 same as in
2000, even though US economy
grew 28%.
40
20
0
1950
1955
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
4
US Net Energy Imports: Actual vs w/o Supply or Efficiency
Changes, from 1973
110
Actual Change in Net Imports (NI)
100
Change in NI w/o Supply or Efficiency Changes
90
80
Quadrillion Btu
70
60
50
40
30
20
10
0
-10
5
Decomposition of Changing Net Energy Imports US Since
1973
110
100
90
80
Quadrillion Btu
70
60
Energy Efficiency
Change in Fossil Fuel Production
Change in Nuclear
Change in Renewables
Stock Changes
Actual Change in Net Imports (NI)
Change in NI w/o Supply or Efficiency Changes
Energy
Efficiency
50
40
30
20
10
Energy
Production
0
-10
6
Transportation
What has worked?
• Price signal
• Regulatory signal
1975: RAISE IT
FROM
12.5MPG TO
27.5MPG BY
1985
1986:
REDUCE TO
26 MPG
1990:
INCREASE TO
27.5 MPG
2009:
INCREASE TO
54.5 MPG BY
2025
1975: RAISE IT
FROM
12.5MPG TO
27.5MPG BY
1985
1986:
REDUCE TO
26 MPG
2009:
INCREASE IT
54.5 MPG BY
2025
1990:
INCREASE IT
27.5 MPG
100
90
80
70
60
50
40
30
20
$10/barrel
Lessons Learnt
• Demand is inelastic - fuel price signals don’t work
• Regulatory signal is the only thing that works
– Corporate average fuel efficiency (CAFE) standards
• Public transportation as a common good is not in the
best interest of automobile and fuel companies
Batteries & Vehicle Transportation
Cost has reduced 3
times between 20082015
Materials and packaging
research and
innovations
Mass-market all-electric cars
Stationary Power Systems
Buildings
Buildings Matter
Buildings use 72% of nation’s electricity and 55% of its natural gas.
Components
• Heating & Cooling
• Lighting
• Appliances
• Plug Loads
Utility bill about $400B/yr
System
• Whole Building
Use the most efficient components and try keeping them off as much
as possible, while improving energy services and indoor environment
Source: Buildings Energy Data Book 2007
LED Lighting
Haitz law for LED Technology
CFL ($2/klm)
Incandescent ($0.3/klm)
U.S. Refrigerator Energy Use
United States Refrigerator Use v. Time
1,600
20
1,400
1,200
$ 1,270
Refrigerator Size
(cubic feet)
15
1,000
800
600
400
10
Energy Use per Unit
Refrigerator Price in 1983 Dollars
$ 462
5
200
0
0
19
47
19
49
19
51
19
53
19
55
19
57
19
59
19
61
19
63
19
65
19
67
19
69
19
71
19
73
19
75
19
77
19
79
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
Average Eerngy Use per Unit Sold (kWh per year)
1,800
25
500 kWh/yr @ $0.15/kWh
= $75/yr or $6.25/month
Refrigerator volume (cubic feet)
2,000
Arun Majumdar, LBNL/UCB
Appliance Standards as Economic Drivers
10000
C
1979
1981
1990
A
750
500
2001
1000
Van Buskirk, Kantner,
Gerke, Desroches,
Chu Science
(submitted) (2012)
1987
1990
1993
2500
1978
1980
Refrigerators
Room AC
250
10000
2004
1994
1988
5000
1000
750
25
Clothes Washers
50
75
100
2005
2500
1979
1981
1983
1985
Price and LCC
(2008$)
D
B
7500
1992
Price and LCC
(2008$)
5000
2000
7500
Central AC
250
Cumulative Shipments (millions)
500
5
25
50
Cumulative Shipments (millions)
250
Behavioral Nudges
Energy Use Labeling
Lessons Learnt
• When operating cost is a small fraction of monthly income and
purchase is price is high, purchase price really matters.
• When purchase price is competitive, consumers will choose cleaner
option (e.g. LED). LED prices becoming competitive because of
technology, driven by display industry and very significant energy
savings compared to CFL and incandescent bulbs
• When both purchase price and operating cost are small fraction
monthly income, price signal is irrelevant. Regulatory signal
(performance standards) matter, and if designed properly, they
reduce both purchase price and operating cost.
• Behavioral nudges, voluntary programs and energy labeling matter
•
•
•
•
•
•
Building
as
a
Whole Bi
System
Insulation
Lighting
Heating, cooling, ventilation
Appliances
Design
Operations
Can we make them work together to reduce energy
consumption and offer high quality energy services and
indoor environment?
Heating & Cooling in UPenn campus building
2006年度UPENN逐月总冷量和热量
Heating and Cooling Load
250000
200
Cooling
180
200000
160
Whycooling
is thisload
building heating and
heating
cooling
atload
the same time?
200
150000
120
GJ
MJ/m2
Heating and
Heating
140
100
180
100000
80
160
60
140
50000
40
冷量 load
cooling
热量 load
heating
MJ/m2
120
20
0
7月
Jul
8月
Aug
9月
Sep
10月
Oct
11月
Nov
12月
Dec
100
1月
2月
Jan 80
Feb
60
40
3月
Mar
4月
Apr
5月
May 6月
Jun
The Challenge
Analysis of 121 LEED-Rated Buildings
Low-to-Medium Energy Use Intensity Buildings
Building codes are for Design Performance, NOT based on Measured Performance.
EUI in
kBTU/sq.ft
.-yr
The Spread
Gaps
• Lack of Measurements & Policies Requiring it
• Fragmentation of Process: Design, Build, Delivery,
Operation
• Fragmentation of Market
Measured to Design Ratio
Towards Zero-Net Energy
M. Frankel, “The Energy Performance of LEED Buildings,”presented at the Summer Study on Energy Efficient Buildings,
American Council of Energy Efficiency Economy, Asilomar Conference Center, Pacific Grove, CA, August 17-22, 2008.
Fragmentation of Buildings Industry and Process
Need to:
• Integrate process & communities
• Integrate building system
• Align incentives
Policy Innovation:
National Standards Based on
Measured Energy and Indoor
Environmental Quality Performance
Courtesy: World Business Council for Sustainable Development (WBCSD) Report on Energy Efficiency in Buildings, July 2008
Barriers and Opportunities
1. Value of energy efficiency is uncertain
and unappreciated
2. Actual performance does not often
correlate to design intent
3. Buildings industry is fragmented
4. Lack of systems integration in building
design and operation
5. Lack of quantitative energy consumption
evaluation
6. Incentives for energy efficiency are not
aligned (split incentives)
a. IT infrastructure for data gathering,
processing, management
b. Building standards based on measured
performance and organized by building
type benchmarking statistics
c. Financial instruments, valuation and
performance-based compensation
d. Align incentives – tax rebates & utility
programs
A. Majumdar , “Reducing Energy Consumption in Buildings,” Testimony to US Senate Energy &
Natural Resources Committee (SENR), February 26, 2009
Cost & Finance
• Upfront cost, financing, payback period
– Zero-net building at zero-net cost over X
years
• Energy service performance contracts
– Bank financing
– Take cut from energy savings
• Tax policy (rebates, cost of capital)
Stock Market
Public
Capital
Real Estate
Investment
Corporation
Trusts (REITs)
Return 2
Taxes
Project
Finance
Return 1
Energy
Efficiency
Projects
Pass through tax structure
Lowers cost of capital
Public capital expands investor base
Generally higher rate of return
Whole Building System Benchmarking and Incentivizing
Office Building
Incentivize
kWh/m2-yr
Hospitals
kWh/m2-yr
Utility Decoupling & Energy Efficiency Standards
D. Steinberg and O. Zinaman, “State energy efficiency
resource standards: Design, Status & Impacts ,” NREL
Report (2014)
Summary
• What is the signal – price or regulation?
• Technology, regulations, economics,
finance and behavior/decision making –
each necessary, but not sufficient
• Informed policies to align and combine
them to achieve energy efficiency at scale