Energy Efficiency: a look at the US, China and India

Energy efficiency is arguably the most promising strategic area to reduce greenhouse gas emissions. By decreasing energy demand, energy efficiency initiatives help reduce:

  • The pressure on our energy system
  • The amount of installed clean energy capacity required to substitute current fossil fuel production
  • Our dependence on foreign fossil fuels, thereby increasing energy independence and stability

While countries have the ability to drastically decrease emissions through energy efficiency measures, their levels of investment and implementation of these options have been mixed.

McKinsey & Company – a multinational management consulting firm – has done several studies on the emissions reduction capacities of different nations – evaluating different measures available to each country and the cost-effectiveness (cost per ton of CO2e reduced) of their implementation. In these studies, McKinsey often uses a Marginal Abatement Cost Curve (MACC) to help illustrate each option’s cost-effectiveness (on the Y-axis) and emissions reduction potential (on the X-axis):

Explanation of a Marginal Abatement Cost Curve (MACC).

McKinsey takes a good look at the emissions reduction potential available through energy efficiency initiatives. Their results show that energy efficiency options tend to have a net economic benefit to society – the total benefits to society are greater than the total costs over the lifetime of the project. Three examples – case studies for the US, China, and India – are looked at in detail:

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Scaling Up Energy Efficiency

Air conditioner in a mosque in Isfahan with a European energy efficiency rating table.

According to the International Energy Agency (IEA), energy efficiency is defined as something that “delivers more services for the same energy input, or the same services for less energy input”. The IEA argues that “energy efficiency represents the most important plank in efforts to decarbonise the global energy system and achieve the world’s climate objectives: in the IEA scenario consistent with limiting the long-term increase in global temperatures to no more than 2 degrees Celsius, the biggest share of emissions reductions – 40% – comes from energy efficiency”. It is one of the most important strategies for reducing Greenhouse Gas emissions and controlling energy demand as our economies grow and develop.

Although energy efficiency measures often bring net benefits to society  – including reduced pressure on energy systems, decreased greenhouse gas emissions, reduced pollution from fossil fuel combustion, and economic savings to energy consumers – these projects are not invested in as often as one would expect.

So, what is keeping us from investing in energy efficiency?

Energy efficiency measures may not be adopted for several reasons:

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The Carbon Capture and Storage Debate: Are we “Locking Out” the low carbon energies of the future?

As explained in a previous post, Government policy can have enormous impact in shaping our technological base in the future by promoting the “locking in” or “locking out” of certain technological innovation.

Just as Governments can help incentivize the “lock in” of renewable energy technology into our energy future, their decisions can also play a large role in whether or not we can “kick the habit” for fossil fuels.

One example if this comes in the European Union’s support of Carbon Capture and Storage technology through the NER300 Programme.

Carbon Capture and Storage (CCS)

Carbon Capture and Storage is a technology meant to capture the CO2 emissions from coal, oil, or gas plants combustion and store it so that it is not emitted into the atmosphere, which would further aggravate climate change.

Sounds interesting right?

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Frustrations from the World’s Youth at the UN Climate Conference

For the past two weeks, leaders from over 190 countries have been negotiating the future of climate change at this year’s UN Conference on Climate.

The negotiations have taken place between member countries of the UN international treaty titled the United Nations Framework Convention on Climate Change (UNFCCC).  The treaty was ratified at the Earth Summit in Rio De Janeiro in 1992.  The ultimate objective of UNFCCC is “to stabilize greenhouse gas concentrations at a level that will prevent dangerous human interference with the climate system”.

Since the UNFCCC was established, the member states (today totaling 194) meet annually at the Conferences of the Parties (COP) to “assess progress in dealing with climate change”. This year’s COP, the 18th since its inauguration in 1994 (referenced as COP18), is being held in Doha, Qatar.  One of the main issues being addressed this year is the future of greenhouse-gas emission reduction and the Kyoto Protocol, which is set to expire at the end of this month.

The conference began with some very dark projections from international organizations like the World Bank and the United Nations Environment Programme (UNEP).  In a UNEP report, published just before the beginning of COP18, they state that in 2010 greenhouse-gas emissions rose to 50.1 gigatons of carbon equivalent.  This figure represents a 25% increase from 2000, and is 14% higher than the projected emissions required (44 gigatons) to maintain the desired 2°C increase in climate temperature; the 2°C increase that scientists believe is the “threshold” to avoid “dangerous” climate change.

Naderev M. Saño, the lead negotiator from the Philippines, gave an extremely heart wrenching appeal to world leaders this week:

Mr. Saño´s plea has become a popular speech amongst news reporters and bloggers covering the conference.  The delegate’s raw emotion and evident frustration regarding the lack of leadership and action being taken by the UN delegation is rarely seen in an international setting such as this.

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