Amory Lovins and the Rocky Mountain Institute
I’m a fan of Amory Lovins and the Rocky Mountain Institute he co-founded. Amory is a thought leader in the field of energy and its application. The Rocky Mountain Institute calls itself a “think and do” tank. The RMI doesn’t just think about and write about energy. They demonstrate and apply that which they think about and write about. They’re not about incremental improvement. They think big and they deliver big.
But first, some terms:
>> What’s a Negawatt?
The term “negawatt” began as a typographical error in a paper on electric power – the writer meant “megawatt”. Amory Lovins capitalized on the typo and used it to mean “a unit of energy not used”. For example, an ordinary 100 watt light bulb emits 1600 lumens of light, while consuming – you guessed it – 100 watts of electricity. A compact fluorescent light bulb that emits the same 1600 lumens consumes only 23 watts of electricity. So, changing from an ordinary incandescent 100 watt bulb to its fluorescent equivalent results in (23 watts – 100 watts) = 77 “negawatts” of electricity not consumed.
>> Energy Intensity?
The term “energy intensity”, as used in this post, means the amount of energy consumed in order to produce a unit of output. For a nation, “energy intensity” could refer to the energy consumed to produce a dollar of gross domestic product (perhaps expressed as quadrillion BTUs per trillion dollars of GDP). For a manufacturer, “energy intensity” could refer to energy consumed to produce a unit of production (perhaps kilowatt-hours per widget, or kilowatt-hours per pound of product).
Supply & Demand
For a factory, a nation or the entire globe there are two ways to power incremental production: consume more energy or improve energy efficiency – megawatts or negawatts. There are several good reasons to prefer demand side energy solutions (negawatts) to supply side solutions (more fuel, more megawatts):
- Energy security: access to energy is increasingly used as an economic weapon. The oil embargo of the 1970’s is one example. Russia’s recent threat to withhold natural gas deliveries to European nations is another. Instances of short supply – deliberate or otherwise — are another. Efficiency improvements (negawatts) are immune to such uncertainties. Negawatts are also immune to fluctuation in the price of fuels.
- Industrial competitiveness: Markets for fuels are regionally diverse, especially when costs for delivery are included. Energy intensity improvements provide a hedge on local fuel price and access issues.
- Decarbonization: Utilities and manufacturers continue to be pressured to reduce carbon (primarily CO2) emissions. Negawatts emit no CO2.
- Atmospheric pollution: Negawatts do not involve combustion or other processes that create atmospheric pollutants, such as oxides of nitrogen or oxides of sulfur. No pollutants = no pollution.
Energy Efficiency: The Secret Revolution, a recent essay by Amory Lovins, says that the supply side (the megawatts) gets the hype, while the demand side (the negawatts) is really making the difference. Here are some examples from Amory’s essay and from other recent sources:[i]
>> Due to the emergence of fracking (supply side), petroleum production in the U.S. during the period 2004 – 13 increased enough to displace oil imports equivalent to 10% of U.S. domestic consumption. At the same time, less driving plus more efficient vehicles displaced the equivalent of 18% (demand side)!
>> In 2012, weather-adjusted electric energy intensity improved by 3.4% in the U.S. – about six times more than the increase in non-hydro renewable electricity capacity.
>> For the 11 IEA member countries improvements in energy intensity over the period 1974 – 2010, the groups’ 2010 GDP would have required 65% more energy, had energy intensity remained at 1974 levels.
>> Amory Lovins’ essay emphasizes that: “We’re using less than half the energy (and emitting less than half the carbon) we would be if today’s economy had 1975 energy intensities. But that is only a fraction of the savings now available and worthwhile.”
>> 2012 global market for energy efficiency enhancements was US$375 billion – about 1.5x the amount invested in renewable energy.[ii] (au / HSBC)
>> In each $ billion in global GDP required almost 40% less energy than it did in 2001.[iii] (au/HSBC)
>> More than ¾ of global new car sales are subject to energy efficiency standards (IEA)[iv]
For Smaller Manufacturers
>> Amory Lovins’ essay concludes: “How low can we go in the efficiency limbo? Nobody knows – but we’re far from any practical limit, and frontiers keep expanding. Every gain in super thermostats and super windows, in LEDs and motors, in process equipment and in computers, locks in more ‘negawatts’ that further reduce our energy intensity.” The logical place for a manufacturer to start lowering and stabilizing energy costs is with an energy utilization efficiency audit. The audit will allow you to identify, quantify and prioritize opportunities in your business. Still a No Brainer! — an earlier post to this blog – explains how.[v]
>> As a result of fracking, manufacturers in the U.S. may hold a competitive advantage in energy costs, compared to other countries. As a consequence, American manufacturers using petroleum based feedstocks, as well as those that are even mildly energy intensive should reassess opportunities for export.
>> Amory Lovins and the RMI staff have published Reinventing Fire, a treatise on how to make substantial improvements in energy efficiency.[vi] The book contains a wealth of well thought out, reasonable ideas that make good business sense. Reinventing Fire should be required reading for all manufacturing managers, large or small. Returning Fire, an earlier post to this blog, reviews the book, especially the industrial section.[vii]
Thoughtful comments and experience reports are always appreciated.
… Chuck Harrington
P.S: Contact me when your organization is serious about pursuing Sustainability … CH
This blog and associated website (www.JeraSustainableDevelopment.com) are intended as a resource for smaller manufacturers in the pursuit of Sustainability. While editorial focus is on smaller manufacturers, all interested readers are welcome. New blog posts are published weekly.
[i] Lovins’ essay is available at http://www.forbes.com/sites/amorylovins/2014/07/18/energy-intensity-the-secret-revolution/
Note: The examples cited are from Lovins’ essay unless otherwise indicated.
[iii] This example is also from http://reneweconomy.com.au/2014/why-solar-may-not-be-biggest-threat-to-energy-utilities-99086
[v] For more on energy efficiency audits, see Still a No Brainer! — http://jerasustainabledevelopment.com/2012/08/16/still-a-no-brainer/
[vi] E. Lovins and the Rocky Mountain Institute, Reinventing Fire, Chelsea Green Publishing (2011)