Monthly Archives: August 2012

Future Energy – Needed Now

By EDF Blogs / Published: August 8, 2012

By: Richie Ahuja, Regional Director, Asia, and Andy Darrell, New York Regional Director and Deputy Director of the Energy Program

Credit: Parivartan Sharma / Reuters

“Leopards and elephants often wander in…”says the manager of a tea plantation in India, left in the dark without electricity after the near total collapse of India’s electric grid.  Trains stopped, miners were stuck underground, traffic lights went out, and homes and businesses were left without electricity.  It was the world’s largest blackout, affecting more than 600 million people.

The truth is, the electric grid in many parts of the world is fragile, often struggling to match supply and demand.   The United States is no stranger to blackouts either, as the Washington post reports. “My house lost power for four days,” notes a fellow EDF’er living in Washington, DC in regards to an outage earlier this July. 

Yet technology is available to make grids much more resilient, nimble — and climate friendly.  From sensors that identify weak spots in advance, to ways to store wind power in electric cars overnight, and buildings that make money by selling “negawatts” into the grid at peak times, we know how to get this right.

Globally, trillions of dollars are poised to be invested into electricity systems in developed and developing countries.  Surprisingly, a lot of the medicine to cure the grid is remarkably similar across the world – deploy sensors that gather data that can be used for both reliability and pollution reduction, make it easy to plug renewables into the network, and reward efficiency and demand response.  Build a data-driven, flexible network that uses technology to harness the power of information.

What’s holding us back is not technology or the will to innovate:  it is outdated regulation and policy.  Like most markets, the electricity market is governed by many rules – rules that frame what’s welcome to enter the market, access to data, how much any of us can make by putting solar panels on our house, etc. With so much investment about to happen, isn’t it time we took a hard look at those rules, to make sure we end up with a network that welcomes the future and rewards reliable, clean energy?

Austin’s Pecan Street project  is pioneering a new way of doing business, one that works for families, for businesses, for people – and the planet.  EDF is taking what we learned from that project and developing ideas for how to open much larger markets to innovation, like California and parts of the Midwest.

Leopards and elephants seem a long way away from our homes here in the U.S.… but reading about this crisis in India makes us realize how related the solutions to our energy futures really are.  And how important it is, in each country, to get it right.

Posted in Grid Modernization / Comments are closed

Making It Real – Energy Efficiency Upgrade Project Performance In The Real World

By Elizabeth B. Stein / Published: August 2, 2012

While codes, standards, and an increasingly energy-savvy marketplace push new buildings toward higher energy standards, existing building stock presents a conundrum.  Upgrading a building to meet higher energy standards than those for which it was originally designed is a tricky business.

McKinsey and others have identified energy efficiency in buildings, particularly large buildings, as one of the most powerful, and potentially cost-effective, opportunities for greenhouse gas (GHG) reductions needed to avoid catastrophic climate change.  However, even energy conservation measures that are “expected” to “pay for themselves” fairly quickly are not implemented universally.   Why?

There are myriad barriers to scaling energy efficiency, but one that gets little attention is the question of how reasonable and achievable upfront energy saving projections actually are.  This is remarkable, because knowing the savings will actually happen is incredibly important for ensuring that energy cost savings streams actually flow to the parties who pay for them – thus making billions of dollars available to pay for them as well ensuring that load reductions resulting from energy efficiency projects can be relied upon by electric system planners and that the GHG reductions we are counting on actually happen.

In a complex world, of course, it would be unreasonable to expect outcomes to match predictions perfectly. And, if the variability consisted of most outcomes coming pretty close to matching predictions, with overperforming and underperforming projects distributed evenly along a familiar-looking bell curve, the unpredictability of individual projects could be managed to some extent by combining them into portfolios.  Unfortunately, this does not appear to be the case.  Although data about energy efficiency project performance is scarce, the little that is publicly available suggests that outcomes do not conform to a neat bell curve, and, worse, systematic underperformance may be the norm. 

I’ve explored some of the reasons for this variability and underperformance – and described EDF’s efforts to foster the conditions for a better track record – by convening parties engaged in various aspects of the upgrade process (our Investor Confidence Project)  in a Snapshot column published yesterday in the newsletter of the Sallan Foundation, The Torchlight.

Posted in Energy Efficiency, Investor Confidence Project / Tagged , | Read 1 Response

Saving Energy One Crab At A Time

By Greg Andeck / Published: August 2, 2012

Imagine the embarrassment of leaving your office lights turned on and returning to find a giant fiddler crab sitting on your desk.  This fishy situation is happening in office buildings all across Charlotte, North Carolina –the crabs are plastic, and the fiddler variety is used for their notorious attraction to light.  It is all part of a fun, social experiment happening in uptown Charlotte office buildings to remind employees to shut of their lights when leaving the office and power down their computers when headed home.  If employees leave their lights on, coworkers will place crabs in the offending employee’s office to remind them to turn off their lights. In order to rid themselves of the burdensome crab, that employee must covertly “tag” another absent minded coworker by leaving a crab on their desk – all in the name of energy efficiency.  

And the amazing thing is that the playful reminder works!  After “Crab, You’re It!” was introduced in one of Mecklenburg County’s office buildings, 26% more lights were turned off when not in use, leading to significant energy savings.  

The “Crab, You’re It!” game – now adopted as part of the Envision Charlotte project – is just one of several innovative employee behavior change experiments that are leading to real energy reductions in office buildings in this entrepreneurial North Carolina city.  The creators of the game – the County of Mecklenburg staff – knew that most office employees are not motivated to save energy solely out of the goodness of their heart.  We are all busy and saving energy in the office is not always top of mind.  The key was to find a way for employees to actually get excited and have fun while saving energy.  And, let’s be honest.  Nobody wants to be crabbed.

Posted in Grid Modernization, North Carolina / Tagged | Read 1 Response

Energy Efficiency: A Resource For The Masses

By Jessica Feingold / Published: August 1, 2012

By: Jessica Feingold, EDF Financial Policy Fellow

EDF believes that On-Bill Repayment (OBR) can do for efficiency what the third-party finance model has done for solar.

A recent post on efficiency.org, entitled ‘Solar is for the wealthy? Not anymore!’ highlights the growth of residential solar projects in middle-income markets (areas with median incomes of $50k-$100k) at the same time that financing became widely available from the private sector.  While wealthier people have always been more likely to be able to afford the upfront costs of a solar installation, the introduction of solar leases and Power Purchase Agreements (PPAs) has extended the opportunity to a much wider range of consumers.  This increase was described in detail in the 2012 California Solar Initiative Assessment.  The success of solar among middle income households – achieved by eliminating upfront costs and allowing for monthly repayment through a solar lease or PPA structure – lends support to the notion that low-cost financing will be critical to making similar advancements in energy efficiency.

EDF has been working to create an OBR program in California that would provide financing for energy efficiency and renewable energy upgrades.  OBR uses private capital to finance these clean energy upgrades at no upfront cost to consumers.   However, OBR differs from the existing clean energy financing models in that it allows for repayment of a clean energy investment on the customer’s monthly utility bill.  This reduces the administrative burden of an additional bill, while at the same time strengthening the credit of the loan by leveraging historically strong utility payment history. Thus, OBR would provide low-cost capital to consumers for clean energy upgrades.

Middle-income earners, in particular, stand to benefit from OBR, since they otherwise do not have access to low-cost, unsecured financing.  Middle-income households are highly price-sensitive and likely do not have sufficient savings or home equity available to make clean energy investments that would reduce their utility bills, resource use and reliance on grid power.  That is precisely why private sector financing was critical to promoting solar among middle-income households.  Energy efficiency projects, on the other hand, have not yet attracted the low-cost private capital needed to achieve such widespread success.

OBR is an innovative financing solution that would allow middle-income households to realize the long-term benefits of energy efficiency, and provide more affordable financing for renewable energy projects as well.

Posted in California, Energy Efficiency, On-bill repayment / Tagged | Read 2 Responses