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.