We're leaving money on the table by not improving energy efficiency (image by pfala, CC 2.5 licensed)
Would you spend $520 to save $1,200? That's the choice McKinsey & Co is offering to the U.S. about energy efficiency. In their new report on energy efficiency, released last week, McKinsey shows how the U.S. can reduce its non-transportation energy use by 23%, eliminate the emissions of 1.1 billion tons of greenhouse gases annually, and save $1,200 billion, for a cost of about $520 billion.
They do recognize that achieving these results requires some new thinking on our parts:
Some more roundup links. These pages have been hanging around in my browser for weeks, waiting for me to blog about them. As with the links I posted earlier this week, I consider these "go to" articles and sites - continuously interesting and relevant.
Honestly, the most interesting article I've read on the economic crisis, because it suggests the problem is structural and provides a prescription for addressing it. (From the New York Times a few weeks ago.)
Available: Home with free electric (photo by Kainet, CC 2.0 Sharealike license)
From MIT's Technology Review comes this column from Kevin Bullis, about a recent report from Deutsche Bank on the economic benefits of investing in new energy projects:
It argues that it's possible to address challenges related to climate change, energy security, and the financial crisis at the same time by investing in four specific areas: energy-efficient buildings, electric power grids, renewable power, and public transportation. The report cites figures that suggest investing in these areas creates more jobs than investing in conventional energy sources because much of the old energy infrastructure is already in place. It says that "a $100 billion investment in energy and efficiency would result in 2 million new jobs, whereas a similar investment in old energy [such as coal or natural gas] would only create around 540,000 jobs."
Amory Lovins is one of my true heros, and I'm thrilled to hear that U.S New has named him one of World's Best Leaders in their report this week. Lovins has inspired multitudes (and this blog) with his vision of "getting off oil at a profit" and "drilling for negabarrels under Detroit." The Rocky Mountain Institute, a "think and do" tank that he founded 26 years ago, takes this vision and makes it happen for Fortune 1000 companies, the military, and governments around the world (including Portola Valley, just up the street from me, where he spoke a few weeks ago).
We now have techniques to save half our oil and gas, and three-quarters of our electricity, at about an eighth of their price. Energy efficiency remains one of the highest-return and lowest-risk investments in the entire economy.
Under the California Global Warming Solutions Act of 2006, the state must impose a limit on the amount of pollutants companies emit and expand renewable energy. These changes, along with others, would result in 100,000 new jobs, boost the state economy by $27 billion and increase personal income by $14 billion, the study said.
The signs are pointing to a critical convergence that, to be honest, is coming just in time. The world's will is aligning. Climate change, oil prices, pollution, growth, commuting - these and other factors are forming a message in society's mind that says "things are not good and they must be fixed." Businesses and governments, at the same time, are realizing that the changes needed to achieve sustainability are not going to be a drag on the economy but can actually be profitable while being good for society as a whole. Of course, the high and rising price of oil has something to do with this as well.
I attended the SDForum Green and Clean Dinner tonight. The topic was "Where's the Money?" Five panelists, representing a VC firm, a bank, an angel funding group, a bridge-financing firm, and an entrepreneur who has raised his money independently, discussed the various sources of funding for clean tech companies. i took extensive notes, and will provide more details later, but for now some of the highlights were:
Liquidity may be different for clean tech companies than we got used to for high tech companies during the Internet boom
In a recent survey by Eye For Transport, supply chain executives across a range of industries agreed not only that "greening" the manufacturing process was becoming more and more cost effective, but that they expected increased profits and better quality as a result.
A whopping 95% of the 3,000 North American executives polled agree that green manufacturing will continue to expand, citing increased profits (66%) and improved efficiency and product quality (43%) as key drivers.
43% is not even a majority, but it's a sign the tide of perception is turning that going green is not a tax, but can result in both bottom line and top line benefits to companies.