Being energy efficient is the best way to cut emissions

Joseph Hogan, Business Times 4 Dec 09;

TODAY, like every other day of the past few years, mankind will release more than 116 million tonnes of greenhouse gases into the atmosphere. Emissions are rising faster now than in any other decade, in spite of our concerns about climate change; and without new policies, our daily emissions will be 140 million tonnes by 2020.

As governments struggle to finalise a new, globally acceptable climate treaty, the difficulties are clear.

Yet there are still grounds for optimism, mainly because we already have solutions that we can use to build a low-carbon energy supply.

As technological advances have made wind and solar power increasingly competitive, they have become the fastest growing segment of the energy market. There is great interest in offshore wind power, in the Desertec project that involves tapping solar power generated in the Sahara desert, and in similar initiatives in the Gobi and Mojave deserts.

This is an encouraging sign that renewable energy is moving towards large-scale power production.

But if we're serious about developing low-carbon power sources, we also need to develop a power system that can deliver them: a flexible and efficient smart grid that will effectively balance our energy consumption with the availability of wind and solar power. The technology is available now, but it needs to be implemented.

We also need to put renewables into perspective. Our only major source of renewable power today is hydro, and less than 3 per cent of the world's electricity comes from other renewable sources. Clearly, they are just one part of our overall strategy to combat climate change.

Surprisingly, our best prospect of reducing emissions is one that gets little attention: energy efficiency. Projections by the International Energy Agency show that using energy more efficiently has a greater potential to curb carbon dioxide emissions over the next 20 years than all the other options put together.

Yet out of US$112 billion invested in clean energy around the world in 2008, just US$1.8 billion was spent on improving energy efficiency, according to a study by the UN Environment Programme and New Energy Finance.

The reluctance to invest in energy efficiency is surprising. Investments can usually be recouped through lower energy costs in less than two years and businesses normally leap at such rapid returns. There is clearly something else going on.

A major obstacle is a lack of knowledge about energy efficient equipment in private households, companies or public authorities, which is further complicated by the variety of available options.

There is also a lack of incentives. Why should a landlord invest in energy efficiency if the tenant will reap the benefits? Why should a purchasing manager spend more of his budget on efficient equipment if the savings all go to the department that pays the electricity bill?

In addition, energy-efficient solutions are rarely photogenic, and many have obscure names. Variable-speed drives, which raise the efficiency of electric motors, sit in plain metal boxes, belying the fact that their energy saving potential is many times greater than the famed compact fluorescent light bulb.

The European Union took an important step in June, when it set efficiency standards for most of the electric motors used in industrial applications. The move was barely noticed, yet it is expected to save 135 billion kW-h per year by 2020. That's three times more than the savings expected from phasing out incandescent light bulbs in the region. This equals to more than 3.5 times the annual electric power consumption in Singapore.

Governments can really help by identifying and removing the barriers to the implementation of energy efficient technologies. Getting the international community to agree on binding targets for global CO2 emissions may look like hard work, but it will come to nothing unless we take the simple step to use energy more efficiently.

And since more and more energy is being consumed as electricity, it is vital that we focus on ways of improving electrical energy efficiency at every stage of its production and end use.

The writer is CEO of ABB, a Swiss-based power and automation company that provides energy technologies for industries and utilities