Energy Efficiency: A U. S. National Academies Report

Summary.  The U. S. National Academies issued a report, “Real Prospects for energy Efficiency in the United States”, in 2010.  The report examines ways in which energy efficiency programs and policies can make significant contributions to reducing new emissions of greenhouse gases by 2030.  Reduced emissions can be achieved in residential and commercial buildings, in the transportation sector, and in industrial processes.  For this reason, energy efficiency should form a major component of efforts to limit greenhouse gas emissions and minimize global warming.

Introduction.  Global warming is currently occurring, due to the release of ever-increasing amounts of greenhouse gases into the atmosphere.  This conclusion is broadly accepted among the scientific community, and understood by much of the American public at large.  Most greenhouse gases arise from mankind’s burning of fossil fuels for energy, starting with the industrial revolution in the nineteenth century.

Among developed, industrialized countries of the world, the United States is the only major emitter of greenhouse gases without a single, unified policy at the national level that addresses the problems arising from burning fossil fuels.  In the absence of leadership at the federal level, various regional, and even local, programs have been put in place to lower emissions of greenhouse gases.  These include the Western Climate Initiative, the Midwest Greenhouse Gas Reduction Accord, and the New England and mid-Atlantic Regional Greenhouse Gas Initiative.  These programs have varying levels of coverage and differing terms of duration. 

Energy Efficiency.  An important, but not widely recognized, component of plans to minimize emissions of greenhouse gases is increasing energy efficiency.  By this is meant setting in place projects and procedures that lead to more effective use of energy resources that are already in use.  That is, efficiency leads to more of a useful energy product being derived, per unit of the fuel consumed.

The National Academies Report.  The U. S. National Academy of Engineering, a component of the National Academies, issued the report “Real Prospects for energy Efficiency in the United States” in 2010.  A free summary may be obtained here.  As noted in a recent local conference held on installing energy efficiency measures in public buildings, increased efficiency would be harvesting the “low hanging fruit” of the tree of greenhouse gas reduction. 

The report was prepared in response to a charge to the National Academies as part of the larger task directed to America’s Energy Future.  The Energy Efficiency panel was asked to set forth the possibilities for improving efficiency in transportation, housing and industry, reporting on technologies currently available, those already known and capable of being put in place, and those not yet characterized.  As with America’s Energy Future, the report describes past and present status and future possibilities, but is not intended to recommend particular policy approaches.  The panel included experts drawn from the academic realm, nonprofit and governmental organizations, and the commercial world; the draft report was reviewed by a different panel of experts drawn from similar sectors of society.

Main Results.  The total amount of energy used in the U. S. in 2008 is given by major economic sector in the table below, in units of quadrillion (10¹⁵) Btu (British thermal units; the amount of energy needed to heat 1 pound of water by 1ºF, about 1,055 joules).

Sector	Quads	Pct (%)
Transportation	28.0	28
Residential	21.6	22
Commercial   Buildings	18.5	19
Industry	31.3	31
TOTAL	99.4	100

Source: Summary, Real Prospects for Energy Efficiency in the United States,

http://books.nap.edu/catalog/12621.html; citing U.S. Energy Information Agency Annual Energy Outlook 2008.

The panel assessed each of these sectors in order to identify the ways that savings in energy used could be accomplished, and by how much.  The following table presents the report’s estimates of energy savings that can be achieved by two future dates, and according to two frameworks, a conservative estimate and an optimistic estimate.  (Note that there is no analysis for heavy-duty vehicles.)

Energy savings in quads relative to the U. S. Energy Information Agency Annual Energy Outlook 2008 (or a similar scenario prepared for Transportation).

	Conservative	Conservative	Optimistic	Optimistic
Sector	2020	2030	2020	2030
================	======	======	======	======
Buildings, primary (source) electricity	9.4	14.4	9.4	14.4
Residential	4.4	6.4	4.4	6.4
Commercial	5.0	8.0	5.0	8.0
Buildings, natural gas	2.4	3.0	2.4	3.0
Residential	1.5	1.5	1.5	1.5
Commercial	0.9	1.5	0.9	1.5
Transportation, light-duty vehicles	2.0	8.2	2.6	10.7
Industry, manufacturing	4.9	4.9	7.7	7.7
TOTAL	18.6	30.5	22.1	35.8

Source: Summary, Real Prospects for Energy Efficiency in the United States,

http://books.nap.edu/catalog/12621.html

In the absence of savings arising from energy efficiency measures, the report estimates that energy consumption would be 111 quads by 2020, and 118 quads by 2030.  These results lead to the important conclusion, according to the report, that under the optimistic estimate, by 2030 the energy savings could be 30% below the forecast usage without the efficiency measures (26% below the forecast usage by the conservative estimate).

Main Findings.  The report’s most comprehensive results are summarized here, just below.  (Details and some other material appear at the end of this post, after Conclusions.)

First, technologies to achieve significant gains in energy efficiency exist at this time, or are reasonably expected to become practical, in the period up to 2020, or 2030.  These efficiencies would permit major savings in energy usage, and corresponding savings in costs to end users.  These have been summarized in the preceding section.  The “business-as-usual” reference trend against which these savings is assessed are those projected in the U. S. Energy Information Agency’s (EIA) Annual Energy Outlook, 2008.  To the extent that prices for using energy increase by market forces, or that governmental policies are put in place that increase the price of energy, these efficiencies should be readily accomplished  (see the table above) and the corresponding savings achieved.  The size of the energy savings that can be achieved is considered large enough to reverse the need to install new electricity generating facilities.  The investment involved in achieving energy efficiency is far less than needed for new generation facilities, and are implemented more rapidly.

Second, if all modalities for achieving energy efficiency in the buildings sector alone were to be implemented, there would be no need to add new net electricity generating facilities.  This comes about because the efficiency savings in the table above from the buildings sector to 2030 exceed the forecast by the EIA for anticipated needs for new generation.  The report assesses barriers that could arise and that hinder full achievement of these efficiencies.  These include high initial costs, alternative uses competing with investment in efficiencies, volatility of fuel prices which inversely affects incentives to proceed, as some examples.  On the other hand, the report cites other U. S. federal programs that have already accomplished efficiencies, such as efficiency standards for appliances and transportation, combined heat-and-power generation, and the ENERGY STAR® program.

Third, the report recognizes that significant barriers to installing energy efficiency exist, and must be overcome.  To achieve this, widespread support from public and private institutions needs to be marshaled.  Examples of programs in large states such as California and New York provide tutorial examples for appropriate policies to put in place.  One major difficulty arises from the long lifetimes of buildings once constructed.  This emphasizes the need to bring new efficiency technologies into construction codes, and into practice, as soon as possible.

Fourth, buildings and infrastructure, once in place, have long lifetimes that lock in the features used in their construction.  For this reason it is important to carry out capital projects with an eye to incorporating known energy efficient design features right away. 

Conclusions.  Energy efficiency programs can provide significant reductions in energy usage in the near term in return for reasonable expenditures of funds invested up front.  Depending on the sector of the economy and the technology or method that is put in place, as much as 26-30% savings in energy use could result by 2030.  This broad conclusion, effective at the national level, indeed internationally, is reinforced by the report in the immediately preceding post on energy efficiency retrofits in public buildings.  Frequently the costs of instituting energy efficiency measures are less than those needed for constructing new energy facilities that are based on renewable energy or that incorporate new technologies for energy utilization. 

Carbon dioxide (CO₂), an important greenhouse gas, accumulates in the atmosphere because it is a stable atmospheric component, not subject to degradation.  Its lifetime is measured in centuries, if not longer.  Currently CO₂ concentrations are at about 390 parts per million (ppm) and increasing by about 2 ppm per year because humanity continues to burn fossil fuels at a high rate.  We can think of the atmosphere as being like a CO₂ bathtub, filling with new CO₂ from the faucet each year, and with minimal reduction in the level of CO₂ by exiting the drain. This increase worsens the effects of global warming with each passing year.  The information presented here argues strongly that implementing energy efficiency programs should be a major part of our efforts to limit emissions of greenhouse gases.

Details.

Historical Review of Policies and Programs.  The report reviews energy efficiency efforts already in place.  A)  Vehicle fuel economy standards have been increased in the U. S. by federal regulation.  They were set at a relatively low level in 1985.  According to the report, efforts to increase the standard were successfully blocked by auto manufacturing companies for years.  In 2007 the corporate average was raised to 35 miles per gallon by 2020.  B) Appliance efficiency standards enacted by certain American states and at the federal level have resulted in important savings in use of electricity over recent decades.  C) In the U. S. building energy codes are issued at the municipal level.  Standards are proposed by national professional organizations and revised frequently; nevertheless their adoption is not universal or ensured, and they may be poorly enforced. 

D) Federal research and development has led to important improvements, many of which have been successfully commercialized.  E) Various American federal tax incentives have been enacted, and many have lapsed, encouraging homeowners to install energy-saving retrofits.  These are complemented in the U. S. by programs at the state level as well as by private electric and gas utility companies.  F) American federal law promotes purchase and distribution of electricity from facilities that use combined heat-and-power facilities (co-generation).  G) In the U. S. consumer education supporting energy efficiency is promoted by the federal ENERGY STAR® program that focuses consumers on home appliances that are rated to use less power.

The American Energy Economy in 2009.  The EIA displays energy flows from its sources through its uses and ending with its products and waste in a comprehensive energy flow chart, shown for 2009 in the following graphic.  The main reason for showing this graphic here is explained in detail in the legend to the graphic.

Energy flows in the U. S. in 2009.  Energy sources on the left are, top to bottom, solar, nuclear, hydro, wind, geothermal, natural gas, coal, biomass and petroleum.  The colored lines show the flows of energy from these sources to its various uses: electricity generation (orange, top left); and residential, commercial, industrial and transportation (pink, medium right).  All light gray flows leaving these five uses represent waste heat that is lost, and is aggregated as Rejected Energy at the upper right.  Useful products of energy are generated electricity (orange flows delivered to the pink destination boxes), and dark gray flows to the aggregate box for Energy Services, middle right).

Source: U. S. Department of Energy Lawrence Livermore National Laboratory and Energy Information Agency. https://flowcharts.llnl.gov/content/energy/energy_archive/energy_flow_2009/LLNL_US_Energy_Flow_2009.png

The important conclusion is obtained by comparing the light gray box for rejected energy (i.e., energy wasted as heat and lost to the environment) at the upper right, 54.64 quads, with the dark gray box for energy services (energy applied for a useful purpose), 39.97 quads.  This shows that useful energy captures only 42% of the total energy present in fuels and other energy sources input at the left of the flow diagram.  Since most of the input energy derives from fossil fuels, this leaves ample opportunity for capturing additional useful energy, and reducing wasted energy, by increasing the efficiency with which energy is used.  Most of the losses occur in electricity generation (26.1 quads; 48% of total rejected energy) and transportation (20.2 quads; 37% of total rejected energy).  This increase in efficiency would lead to economy-wide reductions in the emission of greenhouse gases.

Buildings.  As seen from the first table above, residential and commercial buildings combined use about 40% of the total energy consumed in the U. S.   Of this about ¾ is provided by electricity, and most of the remainder from natural gas.  This energy is devoted primarily to heating, cooling and ventilation, and to lighting.  Efficiency savings are projected to accumulate at a rate of about 1.2% per year for electricity and 0.5% per year for natural gas, leading to a cumulative savings rate of 25-30% per year over the next 20-25 years.  (Not included in these estimates is additional saving by integrated design of buildings that combine efficiencies between the uses itemized above with enhanced structural design.  Examples of commercial buildings incorporating such features have resulted in energy savings as high as 50%.)  Other improvements in several areas are being developed that could contribute even more energy savings.  These new developments could become widely practiced under favorable policies.

Factors cited in the report that could impede putting energy efficiency in operation include public reluctance to undertake retrofitted efficiencies and the long building lifetimes mentioned earlier.  In spite of these factors, placement of energy efficiency could become more favorable with higher energy prices, increased awareness of the hazards of global warming, increased willingness by the public and by business to act to reduce greenhouse gas emissions, and a growing appreciation of environmentally-friendly building practices.

Transportation.  The transportation sector encompasses vehicle transport, rail, air and shipping.  This sector consumes 28% of all the energy used in the U. S., of which about 97% originates from petroleum.  Vehicle transport is the major component, about ¾, used to move people and goods on roadways, and much of this originates from light-duty cars and trucks. 

The report emphasizes that important reductions in greenhouse gas emissions from transportation will come from incremental improvements, rather than from a few major changes in technology.  The internal combustion engine (ICE) and its fuel delivery infrastructure is well established in transportation, and is difficult to minimize or eliminate in the short term.

Improvements in passenger vehicles include reducing their weight, enhancing the efficiency of the engine and drive train, and reducing losses in moving the vehicle on the road.  Many of these changes are currently available or within reach, but not widely deployed.  A concern is that any gains in efficiency from measures such as these would be diverted into producing larger and/or more powerful cars, thus defeating the purposes of reducing emissions in the first place.  The consuming public in the U. S. would need to shift its priorities in favor fuel efficiency and reducing emissions of greenhouse gases.

The report foresees that improvements such as the above, and others, could produce reductions in fuel consumption, and in emissions of greenhouse gases, from today’s levels by 2035 to the range of 55-65% of today’s levels, depending on the type of ICE.  Hybrid-electric vehicles reduce fuel consumption to about 20-40% of present levels, and greenhouse gas emissions to 35-45% of today’s levels (which accounts for generating electricity from fossil fuel-driven power plants).  Fully battery-powered electric vehicles and fuel cell-powered vehicles consume no petroleum fuel directly, but emit greenhouse gases as for hybrid vehicles in view of their dependence on electricity for charging batteries or for manufacturing hydrogen fuel.  Only a major shift to renewable electric generation could significantly affect this factor.

In contrast, establishing non-ICE alternatives such as electric-powered or hybrid-electric cars, or fuel cell powered cars using, for example, hydrogen, is poorly advanced at this time.  Aspects of technology, such as batteries and on-board hydrogen storage, are still under development, and infrastructure to support these alternatives is largely absent.  The report points out that timelines for deploying new technologies are long, in view of development, sales, installing infrastructure, and removing existing vehicles, which have long lifetimes, from service.

The report notes that heavy trucks may experience 10-20% improvements in fuel economy.  Airplanes, which have undergone major improvements in the 20^th century, may still gain up to 35% in fuel economy; but it is widely agreed that air transport will be expanding considerably in future years, offsetting gains in efficiency.  Ships and railroads are already highly efficient, with little further gain anticipated.

The report points out that a systemic analysis of transportation in the U. S. could lead to increased efficiency in the utilization of resources.  This could include reorganizing land use as living space, promoting collective mechanisms for travel, and forecasting how changes in investments and policies could affect energy use devoted to transportation.

Industry.  Manufacturing and other industries, including petroleum refining, consumed 31% of energy used in the U. S. in 2008.  The U. S. EIA forecasts that energy consumed by industry will increase from 31.3 quads in 2008 to 34.3 quads in 2020.  Independent studies cited in the report estimate that energy savings in the industrial sector can be appreciable, 4.9-7.7 quads (14-22%) by 2020, using efficiency measures that provide at least 10% rate of return or improvements that exceed the cost of capital needed by a risk premium.  An important source for enhanced efficiency is combined heat and power facilities (co-generation) that capture additional energy that would otherwise be dissipated.  On the negative side, however, if account is made for imports and exports that do not incorporate energy efficiency in their production, an additional energy expenditure of 5 quads is envisioned.

Beyond 2020, more revolutionary advances are expected in areas such as new sources for heat and power, as well as more efficient technologies for production that capitalize on advances in nanotechnology and micro-manufacturing, as well as more effective resource recovery and reuse.  Other examples include advanced sensors and controls, microwave processing of materials, use of nanotechnology to provide novel ceramic coatings, and high temperature membrane separation processes.

The report notes that in many industries for which energy costs are not high, the incentive to undertake energy efficiency projects is low, compared to competing uses for capital such as human resources, new product research and development, and the need to comply with agency regulations.  Factors that favor increased energy efficiency include high and fluctuating costs for fuels and competitive pressure to reduce overhead and costs of manufacture.  

© 2011 Henry Auer

Producing More Natural Gas in the U. S.: The Pickens Plan

Summary.  The U. S. uses about 25% of the world’s energy, yet has only about 4% of the world’s population.  As part of its energy supply, the U. S. uses large amounts of petroleum, over half of which is imported.  Much of the petroleum is used to fuel transportation. 

Natural gas is a fossil fuel that is widely abundant in the U. S., and is more accessible as a result of recent technological improvements.  Natural gas could be used supplant our dependence on petroleum as a fuel.  Nevertheless, extracting this natural gas is tied to controversial problems related to leakage of natural gas, or methane, a far more potent greenhouse gas than carbon dioxide, from the wells into the atmosphere, and to potential contamination of ground water and surface water with toxins from the drilling compositions used.

The entrepreneur T. Boone Pickens is promoting extensive use of natural gas to fuel transportation, in order to supplant gasoline, which is derived from petroleum including the oil imports.  He has helped author legislation that would provide tax incentives for the use of natural gas in vehicles, and for the manufacture of vehicles that can burn natural gas.

Developing natural gas as an interim solution to providing energy to the U. S. transportation market would be a useful contribution, providing the problems associated with its production can be resolved.

Introduction.  Fossil Fuel Use in the U. S. The U.S., with 4% of the world’s population, uses about 25% of its energy.  According to the U. S. Energy Information Agency,  a source of independent energy statistics, as of 2009 the U. S. used 18.8 million barrels of petroleum a day, of which 9 million barrels a day was for gasoline used in transportation.  72% of U. S. oil consumption was for transportation.  Supplying this consumption included 9.7 million barrels a day of net petroleum imports (11.7 barrels of crude oil and other petroleum products are imported, but some petroleum was also exported), corresponding to 51% of total consumption.  The U. S. produced 7.3 million barrels of total petroleum products a day, which included crude oil as well as the liquefied equivalent of natural gas.

Coal is the worst of the three fossil fuels, producing the most carbon dioxide (CO₂), the important greenhouse gas, for a given amount of heat energy released.   Greenhouse gases arising from human activity are a major contributor to global warming. 
Natural gas is the most efficient of the fossil fuels, emitting the least CO₂ for the amount of heat energy obtained.  It can be used in electricity plants as well as to fuel cars and trucks when the engine is properly modified.  Nevertheless, natural gas fuel still emits CO₂.  Optimally we should move to renewable energy as soon as possible.

Natural gas is an abundant domestic fuel resource, especially with the development in recent years of hydraulic fracturing technology (“fracking”) to extract it from gas-containing shale formations that occur widely in the U. S.  (see the map below).

Gas shale formations in the U. S., shown in pale green.  Copied from http://fracfocus.org/hydraulic-fracturing-how-it-works/hydraulic-fracturing-process

World-wide, supplies may be sufficient to last as long as 250 years.

At least one major oil company, Shell, is actively producing natural gas as a supplement to extracting crude oil.  In 2012 the company will produce more natural gas than petroleum.  Shell notes that modern gas-fired electricity generating plants emit half the CO₂ of modern coal-fired plants, and 60%-70% less than older, less efficient coal plants.

Hydraulic Fracturing.  Fracking involves two aspects.  The first is horizontally-directed drilling, whereby a vertical shaft is drilled to a depth predicted to contain gas within the rock, then the drilling is reoriented horizontally to reach the oil shale formations.  Several horizontal extensions can be extended from one shaft.  The second aspect is the use high pressure fracturing liquids to rupture the gas-bearing rock and release the natural gas to be brought to the surface.  The fracturing liquids are controversial because they contain proprietary mixtures of chemicals which potentially can contaminate ground water or surface water.

Problems with Natural Gas. The problems with natural gas are two-fold.  Natural gas (i.e., methane) is itself a greenhouse gas which, when released without burning into the atmosphere, is 25x as potent a greenhouse gas as CO₂.  The New York Times on April 11^th, 2011 reported that today’s natural gas wells, especially those using hydraulic fracturing (“fracking”) to release the gas from unconventional shale, leak significant amounts of methane into the atmosphere.  These wells therefore worsen the global warming conundrum, rather than help it.

Second, fracking uses toxic chemicals in water to get the gas out.  Unfortunately the chemicals, as well as toxic substances (metals, radionuclides) leached from the shale, may contaminate ground water and may be released into surface waste water.  The Energy Policy Act of 2005, shepherded by Vice President Dick Cheney, explicitly excluded fracking from coverage under the Safe Drinking Water Act (SDWA).   The New York Times reports  that a study by Rep. Henry Waxman and others finds that hundreds of millions of gallons of fracking compositions containing carcinogens regulated under SDWA were in common use in natural gas recovery.    

This important issue was addressed in a hearing held by the U. S. Senate Committee on the Environment and Public Works on April 12, 2011.  Principal witnesses included Robert Perciasepe, Deputy Administrator of the Environmental Protection Agency (EPA).  One important policy disagreement centered on whether it was sufficient, for protection of the public and its water resources, to allow each state to regulate hydraulic fracturing wells individually, or alternatively was it necessary for the EPA to issue regulations applicable nation-wide.  A second related to instances in which waste water from fracking activities passes through treatment facilities with the fracking contaminants remaining in the effluents, rather than having been removed by treatment.

The Pickens Plan for Use of Natural Gas in Transportation.  T. Boone Pickens, a businessman active in the oil and gas industry, recognizes the disadvantageous position the U. S. is in with regard to its energy economy.  Although the biggest single country supplying the U. S. with oil is Canada, a friendly neighbor, a large fraction comes from countries of the Organization of Petroleum Exporting Countries (OPEC), whose geopolitical interests do not necessarily coincide with those of the U. S.  Using the 2009 rate of imports, but the April 2011 price of about $100/barrel, the U. S. is transferring about $219 billion a year to OPEC countries alone.  This is not in this country’s political or economic interest.

Pickens has responded to this situation with a plan to develop natural gas and alternative energy in order to reduce our dependence on imported petroleum.  This post focuses on the natural gas portion of the plan.  Pickens recognizes that natural gas should not be considered a permanent or complete solution the energy challenges facing the U. S., but rather should be used in the interim to allow fully alternative, renewable energy sources to be developed.  In the long run he believes that, for transportation, new technologies need to be developed and implemented that effectively replace fossil fuels entirely. 

In the meantime he believes that natural gas can serve as a bridge fuel that is more advantageous than using gasoline and diesel made from imported crude oil.  He proposes that cars, light trucks and heavy freight trucks all run on natural gas.  He especially believes that fleet operators and heavy trucks would benefit; his web site states that currently there are no batteries adequate for driving heavy trucks.

Mr. Pickens has promoted the NatGas Act of 2011 (New Alternative Transportation to Give Americans Solutions Act of 2011) (H.R. 1380), sponsored by a bipartisan group of 76 representatives.  The bill offers tax credits a) for use of natural gas as an alternative fuel or in an alternative fuel mixture, b) for a new vehicle powered by natural gas, including heavy trucks weighing more than 26,000 lbs, c) for vehicles converted to operate on natural gas, d) for a refueling facility that dispenses natural gas, and e) to manufacturers producing vehicles operable with natural gas.

Conclusion.  Expanded use of natural gas as a fuel for use domestically in the U. S. would contribute significantly, in the near term, to lowering emissions of CO₂.  By using natural gas we reduce payments of large amounts of money to foreign suppliers of petroleum, many of whose interests do not necessarily coincide with those of the U. S.  The Pickens plan for promoting use of natural gas as a transportation fuel makes sense in the near term.  Nevertheless, the significant problems associated with producing natural gas by hydraulic fracturing, which will be the dominant technology going forward, must be satisfactorily investigated and resolved.  At best, natural gas may make sense to serve as a fuel for use during the transition to fully renewable energy.  We should develop renewable energy as soon as we can.

© 2011 Henry Auer