[Biofuel] Amory Lovins Mother Jones
Power QA: Amory Lovins http://www.motherjones.com/interview/2008/05/interview-let-the-little-guys-play.html NEWS: The energy-efficiency guru who cofounded the Rocky Mountain Institute advocates feebates, negawatts, and letting the little guys play. By Michael Mechanic May/June 2008 Issue Mother Jones: What will it take for renewables to go mainstream? Amory Lovins: They already have in many places. The U.S. lags badly; only 4 percent of our power comes from micropower—cogeneration, wind, sun, small hydro, geothermal, biomass, and waste fuel. The reason the U.S. lags so badly is that we have obsolete rules that favor big over small, supply over efficiency, and incumbents over new market entrants. It's the very opposite of a competitive market. So a good dose of conservative economic principles would get us even further than trying to give technologies we like subsidies as big as the ones we don't like are already getting. Of course, desubsidizing the whole energy sector would be a wonderful advance. Remember, the subsidies that renewables get are an attempt to catch up with much larger and ever-increasing subsidies that fossil and nuclear already enjoy. And those are permanent, whereas the renewable ones tend to be temporary, doled out a year or two at a time. The U.S. wind industry has been crashed at least three times, quite deliberately, by Congress messing with the tax credits from year to year and in a stop-and-go fashion. You can't run an industry that way and develop the capacity and the jobs. That's why we import most of our wind turbines. MJ: So if you were king, what would you do to make renewables take off? AL: Level the playing field, but also let them in. There are many obstacles in most parts of the country to being allowed to hook up generators. Many utilities will pay you an unfairly low price or require high standby charges or require onerous and unnecessary engineering studies and fancy switchgear not required by the relevant standards, so these are simply barriers to competition. The barriers that renewables and efficiency face come less from our living in a capitalist market economy and more from not taking market economics seriously, not following our own principles. MJ: What energy policies should the next president try to enact right away? AL: I think the important policies need to happen at a state rather than a federal level. With modest exceptions, our federal energy policy is really a large trough arranged by the hogs for their convenience. MJ: So how could Washington best cut fuel consumption? AL: Let me give you one for electricity and one for oil, because they are each two-fifths of the CO2 problem. For electricity, we decouple utilities' profits from sales so they will no longer be rewarded for selling more energy or penalized for selling less, and if they do something smart to cut our bill, we let them keep a small part, maybe a 10th of the savings, as extra profit—so we, and they, are both incentivized. This has been tried in a couple of states very successfully. For cars, the most effective thing would be a “feebate”: In the showroom, less-efficient models would have a corresponding fee, while the more-efficient ones would get a rebate paid for by the fees. That way when choosing what model you want you would pay attention to fuel savings over its whole life, not just the first year or two. It turns out that the automakers can actually make more money this way because they will want to get their cars from the fee zone into the rebate zone by putting in more technology. The technology has a higher profit margin than the rest of the vehicle. MJ: What's the most promising new energy source? AL: The first 10 or so on my list are ways to wring far more work out of the energy that we already have much more cheaply than buying it. Typically, if we do that right in our buildings, vehicles, and factories, the capital cost will be comparable to today's or even lower. MJ: And in terms of supply? AL: Micropower is now providing about one-third of the world's new electric capacity. To give you an idea of how fast this revolution is going, in 2006 distributed renewables alone got $56 billion of private risk capital while nuclear as usual got zero—it's only bought by central planners. Nuclear added less capacity than photovoltaics and a 10th of what wind power added. Even in China, which has ambitious nuclear goals, they already have seven times as much distributed renewable as nuclear capacity, and it's growing seven times faster. MJ: Then I suppose you consider nuclear the most overhyped energy source? AL: Clearly. It's unable to find private investment despite federal subsidies now approaching or even exceeding its total costs. MJ: If you had $1 million to invest in the energy sector, where would you put it? AL: Efficient use. I want to do the cheapest things first to get the most climate protection and other
[Biofuel] Amory Lovins
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[Biofuel] Amory Lovins' Leaner, Greener World
AUGUST 23, 2004 VOICES OF THE INNOVATORS Amory Lovins' Leaner, Greener World Energy efficiency shouldn't mean sacrificing the comforts of a high-wattage lifestyle, says the Rocky Mountain Institute physicist http://www.businessweekasia.com/bwdaily/dnflash/aug2004/nf20040823_9499_db_81.htm Amory Lovins has a simple message: Saving energy is easier than finding more. It's a point that certainly resonates with environmentalists. And businesses increasingly are drawn to his mantra, since conserving energy saves money and improves competitiveness. Trained as a physicist at Harvard and Oxford, the 54-year-old head of the Rocky Mountain Institute (RMI) in Old Snowmass, Colo., is helping to spread the word that, with energy conservation, less truly can be more. And he believes that innovation in a range of energy and transportation technologies will help achieve these gains. He recently spoke with BusinessWeek's Industries editor Adam Aston. Here are edited excerpts: Q: As the U.S. economy becomes less industrial, it's also becoming more energy-efficient. Each dollar of gross domestic product requires less energy than in the past. How much farther can this go? A: The U.S. now uses 43% less energy and 50% less oil per dollar of real GDP than in 1975, mostly because of better technical efficiency rather than changes in the composition of GDP. Yet this efficiency revolution has only just begun. We can profitably save over half our oil and gas, and nearly three-quarters of our electricity -- far cheaper than buying it, and often cheaper than just its short-run marginal supply cost. This efficiency revolution will be at the core of competitive advantage, and laggards will suffer. Q: How seriously are executives and policymakers taking the need to move away from fossil fuels? A: It has been taken very seriously by many state, but few federal, policymakers and in much of the private sector, including smart financiers. Even some leading coal companies are quietly begging for a climate policy because they can't stand the uncertainty. Leaders in the transition beyond fossil carbon are earning startling returns. Such firms as DuPont (DD ), IBM (IBM ), and STMicroelectronics (STM ) are routinely cutting their energy intensity 6% a year, with retrofit paybacks of typically two or three years. Since saving fuel is clearly cheaper than buying fuel, why continue to assert that protecting the climate is costly? The issue is sharing not pain but profits. Q: Natural gas and petroleum prices are historically high. How much can the effect of this be mitigated through efficiency? A: Straightforward electricity- and gas-demand response could return natural gas to healthier supply-demand balance and $3 to $4 per million Btus [British thermal units] in just a few years, down from its current price of $5 to $6. Electric-load management is the key, particularly during periods of peak demand. Almost all peak power is produced in extremely inefficient gas-fired combustion turbines. So during peak demand, reining in consumption in even a small percentage of users can lead to disproportionate savings in energy and costs. Saving 5% of U.S. electricity, including peak periods, would save nearly 10% of total U.S. gas consumption, dropping the price by about $2 and saving the economy over $50 billion a year. Ultimately, smarter uses of natural gas could cut 2025 U.S. gas use by half. Today's best technologies, if fully applied, can also save half the oil at less than half the cost of buying it. This may well decrease oil prices, too -- though not enough to undercut efficiency's cost-effectiveness. Q: Does your latest book go into more detail on how savings like this could be won? A: On Sept. 20, RMI will publish Winning the Oil Endgame. This is a detailed, business-led roadmap for getting the U.S. completely off oil over the next few decades, and at a profit. To do this, we propose innovative business models and public policies that steer markets without taxing fuel, and speed innovation without issuing mandates. Plus, they should reduce federal deficits and probably won't even need federal legislation. Q: What innovations are available to help to achieve these sorts of dramatic savings? A: Most important are new technologies for radically improving the efficiency of our energy usage in nearly all applications. Using known technologies, it's possible to improve the efficiency of cars and light trucks by up to five times, with no compromise of safety, size, or performance. This means an ultralight, ultrasafe, superefficient vehicle, such as a 70-miles per gallon midsize hybrid SUV. The technology is already being commercialized to automate mass-production processes to make ultralight carbon-composite automotive structures at a competitive cost. That's just a beginning. For heavy trucks, we could double their
