The transformative power of... efficiency
As streamlined shorebirds rose and dove amid sailboats in San Diego’s Mission Bay one recent afternoon, scores of energy wonks gathered in the over-cooled ballrooms of the Hyatt Regency. They'd come to deliberate on the impending disruption to the conventional electrical industry, brought on by tightening carbon restrictions and ever more people making electricity on their rooftops. Some had products to sell, others had ideas to circulate, still others, from utilities and public agencies, just wanted people to understand what they're up against.
“Avoiding chaos,” as one utility manager put it, “is a major concern.”
Greentech Media’s first ever “Grid Edge” conference, held over two days in the last week of June, brought together entrepreneurs marketing the very latest in energy storage technology and rooftop solar installation strategies with representatives from utilities, regulators and big thinkers on energy. Much of the conference, however, wasn’t about all the cool stuff: zinc-bromine flow batteries, new materials for photovoltaic cells, advances in automated nanogrids. Some of it, in fact, was not about how to produce or store electricity at all. Instead, it was preoccupied with a much simpler question: How can we use less energy, and more efficiently?
Outside the conference, over tea at a tiny table draped with bright green cloth, Sam Krasnow, vice president of regulatory affairs for a company called FirstFuel, explained to me why that should be. FirstFuel uses big data to conduct mass audits of commercial buildings; a useful service, it turns out, as efficiency is hard to pin numbers on. Forty-seven states have some sort of energy efficiency program in place, and utilities have to report back to regulators on their savings. Watching energy providers strain under the burden of accounting for waste and savings got Krasnow to leave his East Coast life as an attorney and eventually join FirstFuel.
“Utilities were rolling trucks to do energy audits and they couldn’t keep up,” he told me. Without a big technological solution to the audit problem, “the whole policy project would fall apart.”
Krasnow, 38, is reed thin, dark haired and a little more tan than his LinkedIn profile photo, suggesting that he’s enjoying representing his Massachusetts-based company in Southern California. In the course of a 50-minute conversation, he convinced me that energy efficiency might be one of the more meaningful efforts a person can make for the climate.
“If you want to make the deep cuts in carbon pollution that scientists say are necessary,” he said, “efficiency has to be a very big part of the mix.”
And yet there is a problem, I told Krasnow, just as a waiter whisked away our green tablecloth to reveal a pristine white one: It’s hard to get anybody to pay attention. For most people who lived through the 1970s, the very idea of saving energy brings to mind President Jimmy Carter in his buttoned-up cardigan, advising people to turn down their thermostats.
“But that’s conservation,” Krasnow said, gently correcting me. Efficiency is something else: Think President George H.W. Bush and his climate plan (yes, he had one), which introduced the first federal program to reduce greenhouse gas emissions: Energy Star, which spurred the design of more efficient household appliances.
Efficiency is one part of “demand-side management” of energy, one that carries none of the political baggage that freights other environmental causes. Red-state conservatives embrace it as much as anyone else. (For proof, look to two bipartisan bills that passed last month in the supposedly do-nothing House: one to help schools use less energy and another to fund an Energy Department study on better insulating federal buildings.)
Efficiency also offers the straightest path toward realizing many White House climate goals. Many state governors have balked at the EPA’s Clean Power Plan, which will set state-by-state limits for greenhouse gas emissions. But increased efficiency could help them get close to their goals.
The same principle applies to the power plants themselves. The Supreme Court on June 23 struck down the EPA’s “tailoring rule” for power plants, a plan that would have allowed the agency to apply different standards to different plants, dependent on size. But the court upheld the EPA’s authority to require every power-plant permit-holder to control carbon with start-of-the-art technology — a standard known as “Best Available Control Technology,” or BACT. Given that even the EPA still regards carbon capture and storage too nascent and expensive a technology to require it for power plants, pretty much the only BACT left is energy efficiency.
Indeed, the process the EPA lays out for permit holders to determine the best control technology for greenhouse gases will “in most cases,” the agency’s guidance says, “lead to implementing energy efficiency measures, which generally cost less than add on emission controls and can result in cost savings.”
“Efficiency is the new black,” reports the blog of the company AtSite, Inc., a company that helps design more sustainable buildings. Even better: Efficiency is the new BACT.
Efficiency, along with the other piece of demand-side management, demand response — energy providers adjusting demand to fit supplies — is also a job-creating, startup-fueling business.
Nest Labs, a Palo Alto, California-based firm that Google bought this year for more than $3 billion, has developed a “learning thermostat” that monitors your living habits and adjusts your heating and cooling needs accordingly.
Opower, a Virginia-based analytics firm, studies utility customers’ energy use and behavior to help lower bills and carbon footprints. And then there’s FirstFuel, which has deployed its analytics on behalf of California’s two largest investor-owned utilities, Southern California Edison and Pacific Gas & Electric.
During a “fireside chat” on the first day of the conference, a Greentech Media moderator asked a group of energy experts – a former regulator, an executive and a consultant – to name a technology other than solar that will have the most transformative power in the next decade. All three mentioned tools that allow utilities and grid operators to tinker with how much electricity their customers use at certain times of the day, and thus level out that infamous “duck curve” grid operators so hate. (My colleague Jonathan Thompson describes it as “not a giant radioactive fowl, but the shape made by graphing demand that must be met daily by the California Independent System Operator.”)
“I’m very excited about the combination of big data and smart meters, coupled with some of the automation technologies which are already in place in commercial buildings,” said Mark Ferron, a former California Public Utilities commissioner who, when he left his post last January, was deeply critical of the commission’s reluctance to adapt to the shifting energy landscape (and at Grid Edge, was deeply critical of utilities’ increasing reliance on natural gas). “There’s tremendous potential for using that capability together with data to really – almost invisibly to the customer – create a variety of load profiles to help to shape (consumer demand) as we bring on more renewables.”
In other words, soon utilities might soon have the ability to dial up and ramp down your energy use to cope with both the peaks of wind and solar and bring down your monthly bill. From a privacy perspective a little scary, perhaps, but efficient as can be. And in these threatening days of climate disruption and potential chaos, efficiency rules.