America’s industrial sector generates more than 40 percent of the country’s GDP and employs almost 20 million people in refineries, paper mills, chemical plants, smelters and countless other facilities. This mighty engine consumed one-quarter of all U.S. energy in 2010 — 91 percent of which came from fossil fuels — in many diverse segments, in a dizzying array of complex processes.
If we are to move off of fossil fuels, U.S. industry must lead with investment and innovation. This is not only possible, but critical to capturing durable competitive advantage, according to Rocky Mountain Institute’s Reinventing Fire — a blueprint to a 2050 U.S. economy powered by efficiency and renewable sources of energy.
Eliminating the use of fossil fuels will result in a healthier environment by reducing toxic air and water pollution while stabilizing CO2 emissions at levels that avoid the most damaging impacts of climate change. In addition to improving the environment and stabilizing the climate, Reinventing Fire is also an enormous business opportunity.
Firms that lead this transition will benefit from reduced operating costs, improved profits and product quality, reduced fuel price volatility and supply risks, the creation of new markets and a competitive edge at home and abroad. While the work is not easy, one key technique can help industry make fast strides: energy management systems.
To capture energy savings in industry, it is not enough to merely gather up low-hanging fruit either when capital is available or cost-cutting is required. Leading firms are attaining dramatic results by pushing far past that opportunistic paradigm, establishing a continuous improvement mindset to monitor and manage their energy use in good times and bad.
For example, Frito-Lay cut its electricity energy intensity by 25 percent, natural gas intensity by 33 percent and water by 41 percent from 1999 to 2008. These energy savings investments not only brought a financial benefit, with an IRR of 25 percent and $55 million added to the bottom line, but they also reduce risk. These investments have even generated marketing benefits, especially as consumers get more savvy about where their products come from and how they are made. The installation of solar thermal power at Frito-Lay’s Modesto, Calif., plant enabled the use of the tagline “Sun Chips are now made from the sun.”
In his latest column, Thomas Friedman takes a look at Reinventing Fire. News flash everybody: energy efficiency makes sense!
OUR plan was to meet for lunch at noon in Moscow. It was to be just myself and Fyodor Lukyanov, the editor of the journal Russia in Global Affairs. He picked the restaurant. It had been snowing that day, and the Moscow traffic — already nearly impossible because the city, which 15 years ago had 300,000 cars and today hosts nearly four million registered vehicles — was even more impossible than usual. Soon the e-mailing between us started. I was first: “I’m running a few minutes late.” Lukyanov said the same a few minutes later. Then me again: “I am going to be 20 minutes late.” He then saw my 20 minutes and raised me 20. In the end, I was 50 minutes late, and I beat him by two minutes. We sped through an interview about Russian foreign policy in 30 minutes, before I rushed out so as not to be late for my next appointment. As we hurriedly put on our coats, Lukyanov had one piece of advice for me, and it wasn’t that the U.S. should stay out of Syria.
It was: “Take the subway.”
But this is not a column about traffic — per se.
This is a column about energy and environment and why we must not let the poisonous debate about climate change so tie us in knots that we cannot have any energy policy at all, particularly one focused on developing much more efficient use of resources, through better designs and systems. …
The planet is getting flatter and more crowded. There will be two billion more people here by 2050, and they will all want to live and drive just like us. And when they do, there is going to be one monster traffic jam and pollution cloud, unless we learn how to get more mobility, lighting, heating and cooling from less energy and with less waste — with so many more people. We can’t let the climate wars continue to derail efforts to have an energy policy that puts in place rising efficiency standards, for buildings, windows, traffic, housing, packaging and appliances, that will drive innovation — which is our strength — in what has to be the next great global industry: energy and resource efficiency.
This is where Amory Lovins, the physicist who is chairman of the Rocky Mountain Institute, begins in his new book, Reinventing Fire: Bold Business Solutions for the New Energy Era, which is summarized in the current Foreign Affairs. The Rocky Mountain Institute and its business collaborators show how private enterprise — motivated by profit, supported by smart policy — can lead America off both oil and coal by 2050, saving $5 trillion, through innovation emphasizing design and strategy.
“You don’t have to believe in climate change to solve it,” says Lovins. “Everything we do to raise energy efficiency will make money, improve security and health, and stabilize climate.”
If you’ve have heard about Reinventing Fire, Rocky Mountain Institute’s roadmap for a secure, renewable energy future, and are like almost everyone with whom I have talked about it, you wonder where to start. This blog is the first of several by RMI staff to help business leaders identify the steps they can take now to begin seizing the economic and competitive opportunities available by leading in the new energy era.
Since releasing Reinventing Fire back in October, I’ve been on the road introducing its vision. The majority of my time has been spent with senior business executives, most of whom recognize the risks associated with our aging energy systems but struggle with the magnitude of the challenge and a clear picture for what they can do about it.
A lot of execs are already taking the initial, common sense steps to move their businesses and industries toward a new energy economy. Many others, though, despite their concerns about the consequences of business as usual in our energy system, seem to want that same business as usual to make things better.
Thankfully, Reinventing Fire provides a robust framework to develop solutions that transcend the industrial boundaries and entrenched interests hard-coded into our energy systems over the past century. Our guide to a 2050 energy system that requires no oil, coal or nuclear power includes detailed recommendations for key players within the relevant sectors: transportation, buildings, industry, and electricity. These suggestions range from no-regrets actions everyone can take today to truly innovative actions steps for the most progressive leaders.
Yet, faced with such complex and interconnected issues, many readers are still asking: How do I gain traction personally and professionally? Are there other tangible steps to take now, and how can I influence those around me to join in this grand quest? And, maybe most difficult to answer, how do I know if I am making progress? When asked these questions, I have a few suggestions. They include: Focus on the economics of opportunity vs. the economics of cost. The math may be the same, but people and organizations seem willing to accept a lower potential ROI or assume more investment risk when pursuing an opportunity they are excited about vs. trying to justify a cost they would prefer to avoid. Establish a winner’s mindset as winners and losers are sorted out in the shift from fossil fuels to a more efficient, renewable energy base. Accomplish this by focusing your own and your business’s attention on the opportunities created by action. Keep in mind the risks associated with inaction and maintaining a business-as-usual attitude toward energy.
Own your role in contributing to the problem — and pursuing the solution. I recently had a transformational experience at an event hosted by the Pew Center on Global Climate Change. Up on stage, in front of several hundred people, the CFO of UPS opened his presentation with a simple statement: “We are polluters.” His point was clear and honest — that in the execution of its core business, UPS generates a lot of pollution. The CFO said he — and all of UPS management — own this as a real business challenge, and have made addressing their environmental impact a top-line priority.
I realized that at some point the energy at UPS must have shifted from denial and obfuscation of the obvious facts to acceptance, so all the energy wasted before that turning point could be redirected to solutions. I was left wondering how many coal-based utilities would openly and honestly acknowledge that they were polluters, and how much energy and resource might be unleashed if they just accepted that fact and owned the responsibility to deal with it.
Become present with the problem and challenges for all stakeholders, and look across boundaries to embrace “coopetition.” It’s one thing to understand a problem from your own perspective. It’s another thing to really experience it — to internalize the challenges that the problem causes and really commit yourself to being an active, vital part of the solution. Yet, you’ll also want to understand the perspective and roles that others will play in the transformation and work in concert with them to achieve progressive alignment across all the powers with a stake in the game.
A great example of this is playing out in the renewable energy space, especially in the solar industry. Ultimately, deep penetration of renewables will require broad acceptance by electric utilities. However, management and engineers within today’s utilities often see renewables as a major nuisance with technical and economic hurdles that are not worth overcoming compared with the alternates at hand. While most entrepreneurs and renewables advocates are spending their energy and precious resources lobbying for mandates to force utilities to use renewables, a few are starting to understand they might gain more by working with utility leadership to envision solar and other renewables as a problem-solving asset.
Avoid a too big a focus on quick wins or buzz about the latest and greatest technology. Instead, measure progress one step at a time and in terms of potential scalability. Solutions to messy problems including climate change, national security and economic competitiveness take a long time to develop and rarely take the shape or form expected at the outset, so it’s really hard to predict and measure progress.
That’s OK, and as such it’s essential to see and celebrate small wins and to recognize that in many ways the ultimate scalability of what we are doing today may contribute more than the specific ideas themselves.
For example, many of today’s very successful solar business models and products, which work really well under subsidies, are likely not terribly scalable since they are often unintentionally customized for success within an artificial market. Conversely, some of today’s more moderately successful solar business models and products are slowly proving themselves in unsubsidized and less solar-friendly markets, likely building on a core set of customer-oriented values, which will serve them well in when all the subsidies fade away.
As visionary business leaders have shown, we can all take immediate actions in this grand effort to transform the biggest and most complex system in modern society. Beyond the first steps, diligent application of tested approaches including systems thinking to look beyond narrow boundaries will, in time, create solutions to some of the most wicked problems of our time.
Amory Lovins is an American environmental scientist who serves as chairman and chief scientist of the Rocky Mountain Institute. He is widely considered among the world’s leading authorities on energy efficiency. Harvard and Oxford University-educated, Lovins has worked in the field of energy policy for four decades, briefed 19 heads of state, and published 29 books, including the recent Reinventing Fire: Bold Business Solutions for the New Energy Era.
GreenSource: What were the seeds of your interest in sustainability?
Amory Lovins: When I was young, a friend and I guided in the White Mountains and I developed an interest in mountain photography. That complemented my book learning about the serious problems in the world for which energy seemed to be a master key—if we could figure out energy, it could either solve or teach us how to relate to many of the other problems. That’s been my life’s work.
GS: The title of your book Reinventing Fire is very provocative.
AL: As it says in the preface, fire made us human, fossil fuels made us modern, and now we need a new fire that does all the same things for us that the old fire does, but the aim of the new fire is to do our work without working our undoing. It’s a slightly Shakespearean allusion.
GS: You talk about combining industries to capture efficiencies of scale, but I can’t imagine how to get different industries to cooperate.
AL: We took advice attributed to General Eisenhower: if a problem cannot be solved, enlarge it. If you can’t solve a design problem it’s typically not because it’s not small enough to be bite-size, but rather because the system boundary is too small to encompass all the options, degrees of freedom, and synergies you need to solve it.
With that in mind, we integrated the four sectors that use energy—namely transportation, buildings, industry, and electricity. It’s much easier to solve the automobile and electricity problems together than separately. Collaboration across sectoral boundaries creates important new forms of value that can be profitably met. That’s a substantial part of the $5 trillion of value we find sitting on the table for the next 40 years of the U.S. energy system, using no oil, no coal, no nuclear energy, a third less natural gas with no new inventions, no Act of Congress, and the transition led by business for profit. That last phrase is the fundamental driver. This is not forced by policy, but results from individual firms seeking their own durable advantage.
GS: How do we go from a lack of unification, and siloed industries, to something that’s more seamless and integrated?
AL: This change is going on all around us; the sectors sell to each other already. As a Chinese proverb says, the fish doesn’t know it’s in the water. I’m not so concerned about whether countries have coherent and collaborative policies, because we’re not relying on central governments to make this happen. You might ask, Why did China make energy efficiency its top strategic priority for development in the 11th Five-Year Plan? It wasn’t because a treaty made them do it. It was enlightened self-interest. That’s why China is now introducing the biggest carbon-trading zone in the world in the 12th Five-Year Plan. Absent any global agreement, they’re doing what makes sense and makes money for China.
GS: The existing power grid in most places in the United States is not equipped for renewable energy. It would take a lot of work to get those things into a proper interface.
AL: There are certainly changes needed in how we run the grid and how we authorize and technically enable our distributive generators to connect. That’s normally signaled through price—if you knew that running a load of wash cost six times more now than it would later, you might change your mind about doing it now. We’re not compromising convenience; in fact convenience, health, and productivity would be markedly improved in the kinds of buildings we’re describing. That’s already observable among the people who have such buildings. I happen to live in one. The resulting gains in health and productivity are typically one and sometimes two orders of magnitude, that is, factors of 10 more valuable than the direct energy savings.
GS: Your perspective is very optimistic. Many say we’re not moving quickly enough. What about the naysayers?
AL: I suggest they read the book and listen to what’s happening in the market. Do they know, for example, that for the past three years half of the new generating capacity installed worldwide is renewable? Do they know that in 2010, other than big hydro, renewables became bigger in installed capacity than nuclear power worldwide, and got $151 billion of private investment, and added 60 billion watts of energy? Do they know that by the end of 2011, the world will be able to make 60 billion watts of photovoltaics every year—and that number’s been growing 65 percent a year for five years? In the spirit of applied hope, I’m asking people to look at the evidence and realize that the new energy system I’m describing is emerging all around us as a result of pragmatic decisions in pursuit of profit. Anyone who tries to finance and lease a non-green building in today’s market will understand that things have changed.
One of our latest books isn’t by just an amazing activist-author, it’s by an amazing think-and-do-tank as well!
Reinventing Fire: Bold Business Solutions for the New Energy Eratakes a hard look at current technology and explains, carefully and objectively, how it’s possible to leave fossil fuels behind in just 40 years — and why it’s necessary. But far from being a dreamy manifesto (which, don’t get us wrong, we also appreciate!) Reinventing Fire is full of practical solutions.
Amory Lovins and Rocky Mountain Institute have investigated the renewable energy possibilities and this book is a report on how we can make it happen, and why we must. Here’s a recent blog post from RMI, sharing a video of Amory saying just this. Enjoy!
Oil and coal have built our civilization, created our wealth and enriched the lives of billions. Yet their rising costs to our security, economy, health and environment are eroding and starting to outweigh their benefits.
The good news is that the tipping point where alternatives work better and compete on pure cost is not decades in the future; it is here and now. And that tipping point has become the fulcrum of economic transformation.
Listen to RMI Chief Scientist Amory Lovins explain to Merrill Lynch’s Pamela Faatz how Reinventing Fireoffers a new vision that can revitalize business models and end-run Washington gridlock.
“America is equipped in entrepreneurship, capital and technical skills to lead this revolution,” Lovins says. “And, by using our most effective institutions – the dynamism of the private sector – this is a transition business can lead. So let’s roll.”
In an article published by the Sacramento Bee, a study by the International Journal of Health Services has revealed a shocking increase in the number of nuclear-related deaths in the United States as a result of the explosion at Fukushima earlier this year.
An estimated 14,000 excess deaths in the United States are linked to the radioactive fallout from the disaster at the Fukushima nuclear reactors in Japan, according to a major new article in the December 2011 edition of the International Journal of Health Services. This is the first peer-reviewed study published in a medical journal documenting the health hazards of Fukushima.Authors Joseph Mangano and Janette Sherman note that their estimate of 14,000 excess U.S. deaths in the 14 weeks after the Fukushima meltdowns is comparable to the 16,500 excess deaths in the 17 weeks after the Chernobyl meltdown in 1986. The rise in reported deaths after Fukushima was largest among U.S. infants under age one.
The effects of nuclear waste are widespread and difficult, if not impossible, to contain and predict. When radioactive material is released into the atmosphere and water, it can travel literally worldwide. This latest study is just more evidence in support of limiting and eventually eliminating nuclear power as part of our global energy portfolio.
How can we get to a new energy era without new federal laws?
Do we really have the technology to get off coal, oil and nuclear energy?
How can we capture $5 trillion in saved economic value—creating jobs and driving global competitiveness—by 2050?
Today Thursday, December 1 at 1:00 p.m. (EST), join us for a live chat with Eric Maurer to answer all of your burning questions about Reinventing Fire, RMI’s boldest vision yet about how business can drive the new energy era and lead the transition to a more secure, robust, and healthy future for our nation. (See the live chat console at the bottom of the page. You don’t need to have an account to participate. Simply ask a question.)
A consultant with Rocky Mountain Institute, Maurer contributed to the research and writing of the electricity chapter, coordinating the post-submission production of Reinventing Fire and the Knowledge Center.
In today’s digital age, it is not enough to simply publish a book such as Reinventing Fire and call it done. To reach as many people as possible, we created an infographic and a video to tell the story. Additionally, we’ve posted dozens of reference points for our conclusions and recommendations in our new Knowledge Center. Thousands of people have taken the time to view and share these resources.
Check out the infographic and video below and then join us for a live chat to explore all the details.
The willingness of our visionary supporters to fund RMI’s work was critical to bring Reinventing Fire from vision to reality. And because so many RMI supporters and followers are passionate about energy and well-versed in the nuances of the topic, we know you have questions!
We look forward to a robust discussion touching on a variety of topics.
From The Browser, a site that is “creating a 21st century library of Writing Worth Reading”:
One of their sections is FiveBooks, in which an editor interviews a renowned authority who discusses his or her area of expertise and provides their choice of the best five books to read. Ever wondered what the experts read? FiveBooks has the answers.
And this week, two of our books on renewable energy were referenced by former Congressman Jerry McNerney! Read the entire interview over at The Browser.
We’re in a “dual energy crisis”, says the author of Clean Energy Nation, and not doing enough about it. He tells us what we must do if we’re to overcome our dependence on oil and limit the damaging effects of climate change
Prior to joining Congress, you were an engineer and executive in the energy industry. What sort of work did you do and what did you learn from it?
The importance of our national energy picture stared me in the face when I graduated from college in the middle of the Arab oil embargo of 1973. It was clear how dependent we were on imported oil and how vulnerable we were as a result of that dependence. So I was motivated to go into clean energy by our national security interests. Although I wasn’t aware of global warming in the 1970s, I was very concerned about our long-term impact on the environment. Clean energy was a new and exciting field. The technical work that was being done in the 70s was novel and exciting. The people were fun to work with. Together we developed reliable high-tech products that are now producing a lot of clean energy, and we saw the wind business grow.
You are such an enthusiastic proponent of air-current energy that you named your daughter Windy.
We did. Her first name is Margaret. Windy is her middle name. But she likes it so much that she chooses to be known as M Windy McNerney.
You have calculated that your energy work contributed to saving the equivalent of about 30 million barrels of oil. Why did you run for Congress when you were doing such a great job in the private sector?
I loved being in the industry. It was a lot of fun, and there was a high personal reward for the type of work that we were doing. But after 9/11 my son signed up for the air force, and when he received his absentee ballot in the mail in 2004 and saw there was no one running against the incumbent congressman in our district, he said, “You know Dad, people need a choice. I’m serving my country and I want you to do the same.” I thought about that a lot and I didn’t know how I could say no.
In your book CleanEnergyNation you posit the notion that the world faces a “dual energy crisis”. Please explain.
The dual energy crisis is a twin problem. First, there’s only a finite amount of oil out there to use. We may not be at peak oil now, but our consumption is increasing exponentially. So even if we have twice the amount of oil reserves that we think we have, we’ll blow through those reserves within a fairly short period of time. So much of our technology, our society and our civilisation depends on oil. Food production to feed the seven billion people who inhabit the earth, water production for our cities and our homes, transportation, heating, cooling – it all depends on oil. So if we hit peak oil and the supply starts waning, we’ll see a huge shock to our markets and our economy.
The other problem is global warming. The more oil we use, the more carbon we pump into the atmosphere. And the atmosphere can only take so much before we start seeing significant changes in the way the climate behaves, like the melting of the polar caps, the migration of species and the acidification of the ocean. These are all problems that we’re going to experience. We need to start taking steps to mitigate them. And we need to develop alternative energy sources so that we don’t continue to add to the problem.
Let’s start with books that make clear the severity of this crisis. The Limits to Growth, first published in 1972, projected the consequences of continued population growth in a world of finite resources. What is its core argument?In the book, three scientists from MIT looked at five variables: World population, industrialisation, pollution, food production and resource depletion. They put population and consumption on the existing path of exponential growth, and showed that we’re going to start running out of resources and it’s going to start impacting civilisation. They projected pollution, food shortages and so on.
The book was written 30 years ago. I read it in the 1980s and it made a big impact on me. The predictions were pretty accurate. They foresaw the strains of growth, and the wear on our planet is certainly starting to show. So it’s a good book, an easy read and it gives you some idea of what we’re up against. We must clean up our environment and find cleaner sources of energy.
Some critics argued that the authors loaded their case by projecting exponential population and pollution growth but sporadic technology growth. Isn’t clean energy technology keeping pace?
Any model of society or human behavior is not going to be entirely accurate but nonetheless there is explosive growth, and if we don’t find the technology to replace oil we’re going to be in trouble. We have the know-how to produce the technology that can keep pace. Solar, wind – these technologies can supply a large fraction of the requirements of our civilization, as long as we don’t keep growing exponentially. So we need to find new clean energy sources and become very, very efficient.
Lastly, you cite Wind Power by Paul Gipe. Please tell us about this book.
Paul Gipe is a very well-known wind energy personality. He’s been in the field a long time, he’s traveled a lot and he’s written a number of books. This one is fun to read because it’s about how ordinary people can harness wind power for homes, farms and businesses. It lays out the basics – it talks about the foundation requirements and how to lift the wind turbine up there. It conveys the idea that you don’t have to rely on giant industrial-sized windmills to supply power. It’s aimed at the little guy.
Not everyone is looking to erect wind turbines on their property, but Gipe reminds us that there’s more to renewable energy than massive plants. In some countries, turbines are dispersed throughout the countryside instead of concentrated. Household-sized turbines can even generate surplus energy that can be stored and shared. So even if you’re not in the market for a “how-to”, you might be interested in this book’s vision of the potential of wind energy.”
Our latest title in this category is making a splash as well! Here’s a podcast interview with Amory Lovins, author of Reinventing Fire on ThinkProgress:
Last month Amory Lovins, author of Reinventing Fire: Bold Business Solutions for the New Energy Era, spoke to a fascinated crowd at the US Green Building Council’s conference, Greenbuild.
Greenbuild is the world’s largest conference and expo dedicated to green building. Thousands of building professionals from all over the world come together at Greenbuild for three days of outstanding educational sessions, renowned speakers, green building tours, special seminars, and networking events.
To reinvent fire, we need to master six critical challenges.
1. Build efficient buildings and retrofit existing ones on a tremendous scale
Just one energy efficient building makes a difference. Multiply that by 120 million buildings, and, there will be a revolution. Ultimately, there’s a $1.4 trillion opportunity on the table for smart building owners and entrepreneurs to aggressively adopt straightforward efficiency techniques.
“There are several emerging trends that point to ‘cracking the code,’” said Mathias Bell, RMI consultant. “The challenge is to dramatically accelerate these nascent trends—like straightforward efficiency techniques and technologies—and leverage integrative design to achieve greater energy savings and financial returns.”
To jumpstart widespread investments in building efficiency, building owners, energy service firms and utilities need to spearhead change. The good news is that the time is ripe: the technologies are available, smart regional policies are proliferating, and the opportunity to deliver innovative hassle-free energy products at scale is increasing.
2. Transform the auto industry
A cleaner, safer oil free world—and the health of this vital sector—depends on the auto industry’s ability to produce much fitter vehicles at roughly the same cost before their competitors—both old and new.
A key enabler of the transition is to apply integrative design, vehicle fitness and new manufacturing methods, which can save far more fuel at a similar sticker price by simplifying automaking and shrinking powertrains.
“We are currently on the tail end of a 100-year learning curve, where we see design improvements flattening out,” said Greg Rucks, RMI transportation consultant. “Instead of wringing the last bit of innovation left in current designs, the same amount of innovation and design effort could be more productively applied toward revolutionary autos that exceed 100 mpg with better safety and performance. Automakers who recognize this early will be in the best position to capture market share.”
3. Dramatically reduce the distances traveled by autos and the haul length, weight and volume of cargo carried by heavy-duty trucks
Complimentary to transforming vehicle design is changing how vehicle are used—and it is important that both happen simultaneously.
Paying infrastructure costs by the mile not the gallon, smart IT traffic and transport systems, and other strategies can slash more than half the 13,000 miles a typical American drives each year and cut just under a third or more freight-hauling miles while enhancing personal mobility and freight logistics.
“Nobody wants to sit in traffic for hours, but that is today’s reality. We could provide the same or better transportation services with more options and only half as much drive time,” said Jesse Morris, RMI transportation analyst. “IT developments and smarter use of infrastructure could expand user choice and access.”
4. Sustain and accelerate energy savings and cogeneration in industry
As ubiquitous as “made in China” sounds, industry is still a huge piece of the U.S. economy, generating more than 40 percent of the country’s GDP and employing almost 20 million people. America’s strongest economic engine can become more competitive by accelerating adoption of energy efficiency, boosting cogeneration, and increasing on-site renewable supplies of heat and electricity.
“Industrial energy efficiency is profitable, but it requires courage to look beyond short term investments,” said Albert Chan, RMI consultant. But, gaining insight into energy use across the company delivers many more benefits other than cutting energy costs, including streamlined processes, improved product quality and increased performance. It’s no coincidence that firms that are good at energy management are also the most competitive.”
5. Keep driving down the cost of renewable energy
Today, the costs of some renewable and distributed technologies are still higher than the alternatives.
But, global growth in investment and production of renewable technologies—like wind and solar—is driving rapid cost reductions and improving performance. Using these commercially available technologies, there is more than enough renewable resource available to meet current and future U.S. electricity demand.
“Wind, solar, and other renewables are traveling down a steep learning curve,” said RMI Principal Lena Hansen. “With expected cost reduction trends for today’s technologies, the path to an electric system that is powered largely by renewables could be only modestly more expensive that business-as-usual.”
But, even with dramatic cost reductions, current regulatory structures and conventional utility business models hamper the industry’s ability to transform efficiently and profitably. That’s where #6 comes in.
6. Change the rules of electricity production
There will never be a future free of fossil fuels if utilities’ profits depend on how much electricity they sell, or if distributed renewable sources can’t feed electricity onto the grid.
While we cannot anticipate game changing events or the speed of transformation that can be enabled by technology, the electric system can be ready to respond quickly to threats and take advantage of opportunities.
“The key is to level the playing field for actors to make intelligent and economically optimal decisions,” said James Newcomb, RMI Program Director. “By revamping utilities’ rules and operating models to align with the opportunities presented by efficiency and renewables, we can build a more customer-centric and less risky electric system.”
Harnessing Powerful Interconnections
While pulling each of these levers is critical, it can’t be done in isolation. Reinventing Fire depends on the interdependencies of an entire system to uncover solutions that yield exponential economic benefits and find bigger savings cheaper.
By increasing our productivity with every unit of energy we use across all sectors of our economy—transportation, buildings and industry—we can simultaneously power our increasingly efficient demand with a portfolio of renewable energy sources.
Watch RMI’s new video to learn how we can change energy use forever. And, don’t miss the national launch of Reinventing Fire on October 27!
Imagine fuel without fear. No climate change. No oil spills, no dead coalminers, no dirty air, no devastated lands, no lost wildlife. No energy poverty. No oil-fed wars, tyrannies, or terrorists. No leaking nuclear wastes or spreading nuclear weapons. Nothing to run out. Nothing to cut off. Nothing to worry about. Just energy abundance, benign and affordable, for all, forever.