Amory Lovins Named A World’s Best Leader By U.S. News

Amory Lovins
Amory Lovins

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).

Lovins argues that, contrary to the common belief, efficiency is much cheaper than energy use. Especially when pursued with a technique he calls “integrative design,’ doing efficiency right results in lower energy use, lower costs in the first place, and better productivity. The last point is critical – efficiency improves not only the bottom line by reducing costs, it also improves the top line by increasing productivity and profits.

So why aren’t we pursuing energy efficency faster, if it has so many benefits? Many companies are doing so, getting benefits that go directly to their bottom line and give them a competitive advantage, like Dupont. And Intel. And Wal-Mart.

In 2006, for example, RMI partnered with Wal-Mart to boost the fuel efficiency of the retailer’s truck fleet. “When Wal-Mart came to us,” he says, “we had a lot of internal discussion, because they have big issues,” notably the company’s history of labor problems. “But we decided if we worked only with perfect companies, we wouldn’t get anything done.” The collaboration has proved fruitful. Wal-Mart is now working to retrofit its 6,800 trucks with designs developed by RMI that should allow its fleet to go from getting 6 miles a gallon to between 16 and 18 miles a gallon by 2015, saving about $500 million annually.

These companies, and many more, are enjoying an “unfair advantage” due to their pursuit of efficiency. But for many companies, there are mixed up incentives, such as between commercial landlords and their tenants. The landlord has to pay for the efficiency, but the tenant reaps the benefits – their interests are not aligned, and so “business is usual.” In his books and talks, Lovins provides techniques, guidelines, and policy suggestions to help align these incentives.

For more on Lovins, I can recommend his books, Winning The Oil Endgame and Climate: Making Sense and Making Money (both available free for download) and Natural Capitalism, written with Hunter Lovins and Paul Hawken.

You can hear Lovins in numerous talks and interviews available as podcasts, including this outstanding series of five talks at Stanford University in 2007. Download those to your iPod or mp3 player and prepare to be amazed by the possibilities.

Congratulations Amory!

Amory Lovins On Declining Gas Prices

There's a lot of energy to be saved in all sectors
There is lots of opportunity to reduce energy intensity throughout the U.S. economy

In “a few policies to hedge against crashing oil prices,” the latest post on the Rocky Mountain Institute‘s “Environmental Lovin’s” blog, Amory Lovins himself provides some suggestions on how to keep making progress on energy independence despite the recent dip in oil prices. Of course, efficiency is the star of the show:

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.

The basic argument is that no matter how low oil prices go, efficiency remains more cost effective than almost any other investment. His specific suggestions, such as “fee-bates” to encourage purchasing more efficient cars, rewarding utilities for cutting energy use (as we do in California), and implementing policies that get older less efficient cars off the road faster, are covered in much more detail in RMI’s two books Winning The Oil Endgame and Climate: Making Sense and Making Money (both free for download).

Efficiency investments pay for themselves twice over – saving money on energy usage, while reaping numerous benefits as side effects – improved productivity in businesses, faster learning in schools, better sales in shops. As Lovins concludes:

Conscientiously pursued, this … approach would solve the oil, climate, and proliferation problems at a profit, over a few decades, totaling trillions of dollars.

There have been calls already for President-elect Obama to bring Lovins into the cabinet to help drive us to energy independence. He won’t do it (he wants to remain independent), but hopefully Obama and his team will at least take the advice – it will definitely pay off for all of us – and help us out of the recession to boot.

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