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There are "green shoots" in one area of climate change effort

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Tony Paradiso's picture
Tony Paradiso 228,777
Principal, E3

I provide consulting services primarily assisting renewable energy-related companies in areas such as strategic planning, marketing, and operations. I have helped bring to market numerous leading...

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  • Jun 28, 2023
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Our overall climate strategy is misguided, but “green shoots” exist at the grass roots level.

Positive signs are emerging in energy efficiency. Despite being woefully underfunded, the International Energy Agency recently reported that in 2022 the rate of energy efficiency improvements was double the average for the past five years.

The adoption of heat pumps was a major contributor. Last year, for the first time in the U.S., sales of residential heat pumps exceeded that of gas furnaces. In total, heat pumps comprised 53% of heating system sales.

Globally, heat pump sales increased by 10%. And in Europe they were up by almost 40%.

Improvements in primary energy intensity increased 2.2% in 2022. Again, double the average over the previous five years, and four times the rate in the last two years.

I had to look up the definition of primary energy intensity and I assume I’m not alone. The definition according to the World Bank is as follows:

Energy intensity level of primary energy is the ratio between energy supply and gross domestic product measured at purchasing power parity. Energy intensity is an indication of how much energy is used to produce one unit of economic output. Lower ratio indicates that less energy is used to produce one unit of output.

All of this is good news, but we need even a greater focus on efficiency. The IEA estimates that doubling the rate of energy intensity improvement globally would reduce global energy-related CO2 emissions by almost 11 gigatons by 2030. And doing so doesn’t require upgrading the grid or other massive infrastructure improvements.

How do we get there?

Allocate more resources.

Although global investment in energy efficiency is expected to hit a record level of $624 billion this year, that amount is less than the likely price tag of just the solar tax incentives in the Inflation Reduction Act.

So, a  good place to start to boost energy efficiency is to divert some of the needless incentives being doled out to the already burgeoning solar market.

 

Discussions
T Conroy's picture
T Conroy on Jul 6, 2023

Excellent post. In the U.S.A., wind and solar are volume commodity products and therefore unlikely to make further cost reductions due to gov't subsidy policy. Unfortunately, wind and solar have become two rent seeking industries with potent political power, which means subsidy reductions are highly unlikely to be targeted at them.

This author's suggestion opens up the much larger and more important topic: our global decarbonization policies are clearly failing despite throwing trillions at the problem. The notion that we will be able to throw ever increasing trillions at the problem with the lack of evidence of success seems politically unrealistic. We need to confront this issue.

Tony Paradiso's picture
Tony Paradiso on Jul 13, 2023

Thanks for your reply and your observation regarding the likelihood of continuing subsidies for wind and solar. Part of me always holds out hope that our political leaders will eventually get it right, but experience tells me otherwise. 

We need to approach climate change as if it were a business. Prioritize resources and set metrics. If we don't achieve those metric we either adjust or revamp our strategy. Understanding that valuable resources will continue to be misdirected makes maximizing the properly applied ones even more critical.

Alternative approaches also have to do a better job of communicating their successes to the general public and why they are worthy of more attention. Perhaps if enough voices in the industry begin to speak out, we can redirect at least some of those misdirected resources.

Tony Paradiso's picture
Thank Tony for the Post!
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