Wednesday, August 22, 2007

Think: Less - Revisited

According to Vice President Cheney's now infamous quip: "Conservation may be a sign of personal virtue, but it is not a sufficient basis for a sound, comprehensive energy policy." Well, maybe now it is. Jim Rogers, chairman and CEO of Duke Energy, has been getting a lot of press lately with his "save-a-watt" program, and it sounds a lot like the basis of an energy policy to me.

Thomas Friedman (NYT, 8/22/07) quotes Rogers as saying,"The most environmentally sound, inexpensive and reliable power plant is the one we don't have to build because we've helped our customers save energy." The idea is that by partnering with customers to make homes and businesses more energy efficient and utilizing smart devices to regulate electricity usage during peak times, watts are "saved", i.e. not used.

According to Friedman, Rogers goes on to say, "Energy efficiency is the 'fifth fuel'--after coal, gas, renewables, and nuclear. Today, it is the lowest-cost alternative and is emissions-free. it should be our first choice in meeting our growing demand for electricity, as well as in solving the climate challenge."

So, how do we get consumers to use more of this fuel--energy efficiency? Well, it ain't going to be easy.

In our Think: Less blog entry a few months ago, we said:
We have to recognize that this issue [the "greening of America," concern about the environment, and a willingness to conserve] is ultimately about people and the energy they use and the goods they consume...we have to accept less--less consumer goods and less convenience. There must be sacrifices and there must be changes in lifestyle if we are to make a difference. No pain, no gain.
No one wants pain, even if it means there will be gain down the road. There must be real, upfront information signaling to consumers what their energy consumption means.

That's where Rogers' smart devices come in. As one industry expert put it recently, one simple way to drive home the real value of electricity is through sub-metering, so that electricity is seen as providing a "service" instead of just a baseline commodity, With sub-meters applied to individual appliances or systems, the REAL costs of electricity will be much more easily understood. Imagine, getting your monthly electricity bill and instead of giving you a base kwh rate per hour, you got something like this:

Light - $ .02/kwh
Refrigeration - $ .04/kwh
Heating - $ .05/kwh
Cooling/Air Conditioning - $ .08/kwh
Computing - $ .04/kwh
Computing Power Reliability Surcharge - $ .02/kwh
CO2 Emissions Reduction Surcharge - $ .08/kwh

Would the average consumer change their electricity usage habits? Chances are, when it is spelled out so vividly, the answer would be yes.

It's not just a question of no pain/no gain; it's about no knowledge about consequences/no reason to change behaviors. Giving consumers the tools and the knowledge to make educated decisions about their energy usage is the only clear way we can expect them to make the choice to use a lot more of that 'fifth fuel'--energy efficiency.