Much More to Learn About Energy Savings

During the State of the Union address last night, President Obama said, “The easiest way to save money is to waste less energy.”  How can we expand the public conversation about energy to include not just alternative sources but also reducing consumption? Daryl DeJean, an active national speaker and consultant to Fortune 500 companies on energy efficiency technologies, spoke with the Center for the Next Generation about educating the public about energy savings. 

Q: How would you assess the nation’s general understanding of saving electricity through building improvements?

On a scale from 1 to 100, I would say the general public is at 30. The general public and small businesses are aware of the need to save electricity, but not through building improvements. The focus has been on appliances through programs such as ENERGY STAR for products. Awareness also centers on vehicle efficiencies. The general public hears messages of what an item or technology can possibly due for energy efficiency, but have not been told of the connection to effective improvements and ensuing energy used by buildings.

Q: Which will lead the way toward a wider embrace of advanced energy systems – newer, more efficient technologies; a faster return on investment, or more effective marketing strategies by contractors and equipment manufacturers?

Here’s the key to wider adoption of advanced energy systems at this time:

• At the national energy policy level, the US Government needs to place a high priority on education, public relations and marketing to the general public and small businesses and organizations to build awareness of no-cost to low-cost strategies for energy efficiency and sustainability. There also needs to be accountability built into the government agencies that have promised energy savings and have not yet delivered on their promise.
   
• Market adoption of advanced technologies will only occur in the large corporate market ($5 billion in sales and above) as the technologies are still in their infancy stage. This is due to the arduous process—fraught with bottlenecks and failures—of proving the value of the technology and actual energy savings.  To achieve higher market penetration, the energy efficiency manufacturing industry, as well as contractors, needs standards for energy and functional performance, industry collaboration to market products with a single set of lingo and open protocol web-based platforms and policies that encourage entrepreneurial R&D and new product development without the high level of subsidies that discourage risk-sharing.
   
• Industry and government currently promote technologies and fail to educate the customers, including large corporations, on the applications and practical side of installations and benefits gained by the end users. They are only concerned with the energy reductions not the impact of the technology on the entire building and business.
   
• The advanced technologies also do not always address the end-users’ need for functionality, esthetics, health, safety, communications and most importantly behavioral variations.
   
• We also need to build consensus that sustainability begins with the proper loading order: energy efficiency first, then renewable energy. Our nation has gone to the extreme of looking at the most costly measures (renewables) and it is currently backing into the least costly measures.

Q: What role, if any, do state and local governments have in convincing more building owners to make the necessary retrofits?

Policy is only one part of the equation. All levels of government have to make accountability a #1 priority to ensure that building owners adopt the advanced energy solutions if subsidies are given away. In order to have accountability, you must have an energy performance tracking system that objectively reports energy performance at the whole building level.

Q: How about the federal government – do we need a national incentive program that would, in the long run, make financing easier for non-residential building owners?

We have been subsidizing many sectors of the energy efficiency and renewable energy markets with little to show for it. Investments funded by the Federal Government via the American Recovery and Reinvestment Act (ARRA) have no clear accountability measures. In addition, incentives (or subsidies) are not the solution because the customers pay for them and they are often ill directed and the incentives dollars get lost in the bureaucracy. Coupled with market introduction, a well implemented marketing and education program should be a collaborative effort between the Federal, State governments and industry. This may reduce the need for financial subsidies that are costly and reduce the motivation to share in the performance risks.

Q: What is the range of financing options for a building owner who would like to upgrade his property?

There are many options available from internally generated cash (cash flow through no- or low-cost measures staged in over time), utility on-bill financing, or leasing and commercial property assessed clean energy (PACE) programs. Bank financing is also available through credit unions and community banks that did not get hurt in the financial debacle of the last four years.

Q: What are the new energy-saving technologies on the horizon and when might they become available?

There are few and far between. Investments in new technologies have been made by the US Department of Energy, California Energy Commission as well as other stakeholders for decades. The technologies are stuck in the R&D phase with few manufacturers succeeding in getting them into the marketplace, often losing millions before they recoup 5% of their original investment.

Q: Let’s talk about homeowners: How different are the financial challenges for them, and what additional creative tools could become available to convince them to upgrade their homes?

There is a national program that works and delivers energy efficiency successfully - ENERGY STAR Program for Homes and Products. The EPA should put more traction behind the program. Instead, the budget of the agency has been redirected to enforcement and punitive programs instead of encouraging homeowners, small businesses and organizations to learn about energy efficiency measures and strategies.

Q: Five years from now, how much more energy efficient will the country be?

The trend line, according to the Department of Energy, is a leveling off of consumption as a percent of our Gross Domestic Product. This is with increased regulations and tighter codes and other mandates. This is quite an achievement given the birth rate of this country. This is based on a base of a collapsed GDP.

My personal view is that educating the sectors of the economy that have not benefited from the energy efficiency inside track is the next step. The investment of time and money using this strategy at the Federal and State Governments is urgently needed. This will be what will result in our economic recovery as our “resource productivity” as a nation will increase perhaps five fold with little up front capital investment.

Daryl DeJean is Executive Vice President at Kingport Corporation and CEO of Emerging Technologies Associates, Inc.. Both are energy consulting groups.