Efficiency and the Jobs Argument

By Elisa Wood

September 25, 2008

How will the recent bad economic news affect energy efficiency efforts? Will state lawmakers retreat from the many financial commitments made over the last year?

It is too soon to know the answer. But one thing is for sure, the industry may have to shift its marketing message. Consumers and politicians typically are keener on protecting the environment in good times than they are in bad.

The fact that efficiency programs create jobs seems to strike a cord. If you are looking for facts and figures to bolster arguments about efficiency’s job-creation ability, check out the 300-plus page report, “Green Jobs: Towards decent work in a sustainable world.”

Released this month by the Worldwatch Institute, the report says that the global market for environmental products and services is likely double from $1,370 billion per year to $2,740 billion by 2020. Half of this market is in energy efficiency.

US clean technologies are already the third largest sector for venture capital – bested only by information and biotechnology.

Further, the report cites data from the Apollo Alliance New Energy for America that says 827,260 jobs could be created in the United States through investment in high-performance buildings alone — both retrofitting and new green construction.

The numbers are big and striking. However, policymakers should be warned that not everyone will share in the bounty. There will be winners and losers. The losers will include companies that are slow to clean up their technologies, heavily polluting industries, and regions where livelihoods depend on those older industries, according to the report.

“The policy challenge is not to let these distinctions become permanent features. The transition to sustainability and greener employment needs to be well planned,” says the report.

Energy efficiency offers a unique job building advantage for communities. Many of the jobs the efficiency industry creates are local. Thus, it will be city and state policymakers that need to do the planning to ensure job-creation in their communities. This may be a good report to pass along to city councilors and state legislators as they vie to keep their local economies upright.

To view the report go to: http://www.ilo.org/integration/greenjobs/index.htm.

Visit energy writer Elisa Wood at www.realenergywriters.com and subscribe to his free EE Markets newsletter and podcast.

Profile of a White Tag Project

By Lisa Cohn

September 18, 2008

Few topics we write about here draw as much attention as energy efficiency certificates. After we mention the certificates, we inevitably receive inquiries from data centers or other large energy users, who want more information.

The certificates also are called “white tags,” a term trademarked by marketer Sterling Planet. Interest in the certificates likely stems from the increasing use nationwide of a more established sister product, renewable energy certificates or green tags. Green tags come from renewable energy projects, while the newer white tags are generated by efficiency measures, like lighting retrofits, combined heat and power, and demand response.

Both white and green tags can be bought and sold. Utilities and other electricity retailers need them to meet mandates in certain states that they provide a set amount of their supply from clean or efficiency energy sources. Voluntary markets also exist for the tags throughout the country. In this case, companies or institutions buy the tags not to meet a law, but as an environmental gesture.

Connecticut has led the way in creating a white tag market. The state requires that utilities and electric retailers make efficiency 2% of their power portfolios this year. The requirement grows to 4% by 2010.

Here we provide a profile of a recent white tag project we unearthed in the files of the Connecticut Department of Public Utility Control. An IBM data center in the town of Southbury created the white tags and won approval September 12 of their validity under Connecticut rules.

IBM created the tags by installing 1,200 efficient lighting fixtures in October 2007 in its 846,000 square foot, three story building. The facility operates 8,760 hours per year. Specifically, IBM retrofitted 3-lamp, T-12 lamps and magnetic ballasts with more efficient T-8 lamps (two per fixture) and electronic ballasts. The fixtures will save the facility 829 megawatthours. IBM determined the savings by subtracting the energy it consumed after installing the new lighting from the energy it consumed before the installation.

The certificates are viable through March 31, 2018. The ending date is based on a state determination that the life of such efficiency projects is typically up to ten years. The facility must measure and verify savings each quarter and submit the results to the state.

Each MWh equals one certificate. The state does not set the price for the certificates – what IBM receives will depend on the market.

The company that helped IBM convert the efficiency savings into certificates was Neuwing Energy Ventures, 6 Evergreen Lane, East Haddam, Connecticut 06423.

For detailed information on the state’s conversion rules we suggest reviewing the Connecticut DPUC’s order setting up the program, DOCKET NO. 05-07-19. This can be found at the ‘in-active dockets database’ http://www.ct.gov/dpuc/cwp/view.asp?a=3364&q=413272.

Visit energy writer Lisa Cohn at www.realenergywriters.com and subscribe to his free EE Markets newsletter and podcast.

Next, the Air Car?

By Reid Smith

September 11, 008

Vehicles account for 26% of the nation's carbon dioxide emissions, and 51% of the average household's daily CO2 output (http://www.fueleconomy.gov/feg/climate.shtml), according to the U.S. Environmental Protection Agency. So, clearly fuel economy is critical to reduce greenhouse gas emissions.

Big car manufacturers, like GM, Ford and Toyota, have seen a dramatic drop in recent sales. In response, they are beginning to make smaller, more fuel-efficient, vehicles, as well as step up research on new fuels. GM announced development of the battery-powered Chevy Volt, set to be released in 2010. This is a much needed move in the right direction.

However, we need more revolutionary change. The solution, it seems, will come from companies that are reaching far outside traditional lines of thought and coming up with truly innovative ways to fuel our cars. One such company, Motor Development International (MDI) (www.mdi.lu) of France, has developed a vehicle that can run almost exclusively on compressed air, and therefore only emits air. MDI, which is headed by Guy Negre, founded the company in the 1990s in pursuit of a new environmentally friendly engine that was also cost competitive.

The car runs on compressed air at speeds up to 35 mph. Then conventional fuels kick in – fossil fuels or biofuels. These cars could be particularly effective in reducing city pollution, since we tend to drive slower on urban roads.

One tank of compressed air lasts up to 93 miles before it needs to be filled. The tank can be plugged into a standard electrical outlet and filled in about four hours. It is also possible to refill the tank much more quickly – in as little as three minutes using a high-pressured air pump.

How does the car work? The air tank is made of ultra-light carbon fiber and holds 52 gallons of air. From the tank, air is forced through an injector to the engine, where it expands and pushes down on pistons that turn the crank shaft, which propels the car.

Although the air car needs to be as light as possible for maximum efficiency, these cars are not necessarily small, and several models are already under development. A two-seater, the OneCat is one option. A three-seater, the MiniCat is another option. A six-seat sedan, the CityCat; and a compact truck. The company plans to introduce a six-seat, four-door family-size version to the U.S. market in 2010 according to Popular Mechanics http://www.popularmechanics.com/automotive/new_cars/4251491.html?series=19. This model is expected to achieve over 100 mpg and over 90 mph, emit little or no CO2, offer plenty of space for luggage, meet all safety requirements, and cost no more than an average economy to mid-size vehicle.

Tata motors (www.tatamotors.com), India's largest car manufacturer and leading company for automotive R&D has already signed a contract with MDI, and cars hit the streets there at the end of August. The deal provides MDI with a significant capital infusion to further the technology and get it ready for the mainstream public.

The air car is just one example of innovative, affordable, and environmentally clean cars being developed all around the world. The next decade will bring monumental changes to the auto industry as priorities in car design shift and consumers demand change. Cars ten years from now will be very different from those we drive today. What remains to be seen is whether the US cornerstone car companies will adapt to these changing technologies or if foreign innovators will drive off with the market.

Visit energy writer Reid Smith at www.realenergywriters.com and subscribe to his free EE Markets newsletter and podcast.

Getting Ready for the Next US Industrial Boom

By Elisa Wood

September 4, 2008

Selling large manufacturers on energy efficiency isn’t easy, even though they stand to achieve great bang for the buck. Manufacturers are apt to only consider efficiency improvements as part of a major plant expansion or improvement. Such capital expenditures tend to occur in a cyclical fashion, and manufacturers give little thought between cycles to new efficiency measures.

The good news is that the United States appears to be readying for a new cycle of industrial capital investment, creating a window of opportunity for energy efficiency companies, according to a report by the American Council for an Energy-Efficient Economy.

“Trends in Industrial Investment Decision Making” points to several clues that factories are preparing to refit and expand after years of avoiding the risk of such investments.

•Plant capacity, or level of output in producing goods, is rising to historic levels. High capacity rates encourage factory owners to expand and new competitors to enter the market and build plants.

•Product output per employee is up, a frequent precursor to new capital investment by manufacturers.

•The cost to ship goods to the United States has escalated dramatically because of a shortage of ships and high fuel prices. Thus, it is increasingly cost-effective to produce goods within the country rather than overseas.

These pressures are likely to result in new, long-term investment in factory capacity, the likes of which the United States has not seen in 30 years.

What should energy efficiency companies do to prepare? Start forming relationships with manufacturers now, so that you can learn about their particular investment cycles, as well as the greater market forces that influence their decisions, the report says.

The full report, by R. Neal Elliott, Anna Monis Shipley and Vanessa McKinney, is available free of charge at: http://www.aceee.org.

Visit energy writer Elisa Wood at www.realenergywriters.com and subscribe to her free EE Markets newsletter and podcast.