Amory Lovins from the Rocky Mountain Institute, US, says the cost of energy efficiency will fall — not rise — with wider use if we adopt integrated system design. That’s a divergence from the traditional view that, once we’ve exploited the easy “low-hanging fruit” energy-saving options, it will get harder and more expensive to make more savings.
It may be true that as energy-saving measures are rolled out widely, the technology will get cheaper due to economies of production volumes and learning curve improvements. But in his recent paper, Lovins goes further: integrated design offers large additional cost savings. That’s since we are moving from energy efficiency upgrades — add-ons to basically unchanged systems — to complete new system designs.
economic theory cannot reveal whether efficiency’s ‘low-hanging fruit’ — a misnomer for eye-level fruit — will dwindle or grow back faster than it is harvested, but experience so far strongly suggests the latter
Lovins offers examples from the building sector, with big savings possible via designs incorporating full insulation that eliminate the need for heating systems, as at the Rocky Mountain institute’s HQ. Eliminating or downsizing heating and cooling needs is obviously good news, assuming it does not cost too much, which is what Lovins claims. He offers similar gains from system design approaches in industry; energy use can be reduced by clever design and new tech. This seems fair enough — you can squeeze out energy use and cut costs. But can that process be continued repeatedly? Aren’t there final limits? Lovins seems to think not. At least, not until we get to zero energy use, or low residual energy use based on renewables.
Lovins cites the US energy intensity data, noting the continually falling level of energy/GDP. “US primary energy intensity has more than halved as controversially foreseen in 1976, but another threefold drop is now in view and keeps getting bigger and cheaper,” he says. Lovins believes similar trends are possible in China and Europe.
This may all seem very optimistic but Lovins is upbeat, even utopian. “Today’s efficiency-and-renewables revolution is not only a convergence of technology plus design plus information technology,” he says. “It reflects no less than the emergence of a new economic model. Today’s energy transition exhibits not the Ricardian economics of scarcity, like diminishing returns to farmland and minerals, but the complementary modern economics of abundance, with expanding returns. These flow from mass manufacturing of fast granular technologies with rapid learning, network effects, and mutually reinforcing innovations. With those new driving forces, today’s emergent paradigm for profitable climate stabilization envisions an energy-and-land-use transformation not slowed by incumbents’ inertias but sped by insurgents’ ambitions.”
I’m reminded of Murray Bookchin’s classic anarchist work in the early 1970s on post-scarcity economics. But also, less palatably, of Simon and Kahn’s hyper-optimistic 1980s high-tech and innovation-led Cornucopia. There again, let’s not knock optimism too much. Launching the International Renewable Energy Agency (IRENA) publication A New World – The Geopolitics of the Energy Transformation, IRENA director general Adnan Amin said that the transition to renewables and away from fossil fuels is “a move away from the politics of scarcity and conflict to abundance and peace with new opportunities for many countries”. In broad terms, that’s hard to gainsay.
On the issue of efficiency, Lovins writes in Physics World sister publication Environmental Research Letters (ERL) that “economic theory cannot reveal whether efficiency’s ‘low-hanging fruit’ — a misnomer for eye-level fruit — will dwindle or grow back faster than it is harvested, but experience so far strongly suggests the latter. For example, after decades’ effort, the real costs of Pacific Northwest electric savings have nearly halved while their quantity tripled since the 1990s.”
Looking more broadly, Lovins cites the global Low Energy Demand scenario produced by Grübler et al. Compared with more conventional scenarios, Lovins says, this “enables 80%-renewable 2050 supply and more-granular, faster-deployable scale, needs several-fold lower supply-side investment and far less policy dependence, leaves an ample 50% ‘safety margin’ in demand, yields major positive externalities, and needs no negative emissions technologies”.
Cutting energy demand
The study by Grübler et al. is certainly interesting. As I noted in an earlier post, it claims that it is possible to reduce global energy demand to 245 EJ by 2020, around 40% lower than today, despite rises in population, income and activity. It looks to an energy services approach and to the widespread use of digital systems to improve efficiency, enable integration and meet end-use energy requirements interactively.
That’s also a feature of the essays on A Distributed Energy Future for the UK published by the Institute for Public Policy Research on what can be done to shift to decentralized power, which I mentioned in my last post. The essay series focused on “prosumer” initiatives, aided by digital system integration. Looking more broadly, Blueprint for a Post-Carbon Society, a study by Imperial College London and Bristol-based energy supply company OVO Energy, has calculated that in a high UK renewables scenario the use of residential flexible technologies such as smart electric vehicle (EV) charging, smart electric heating and in-home battery storage could save the UK energy system £6.9 bn.