This is the era of Big Oil. Could the next be the era of Big Efficiency?

A new report by the American Council for an Energy-Efficient Economy suggests the possibility. Re-invented with today’s smart energy technologies, energy efficiency could displace 40 to 60 percent of our total energy needs by the year 2050, according to The Long-Term Energy Efficiency Potential: What the Evidence Suggests.

Sound far-fetched? ACEEE says history backs its assertion. Over the last 40 years we tripled the US economy, “and three-quarters of the energy needed to fuel that growth came from an amazing variety of efficiency advances—not new energy supplies,” said the report. Energy forecasters at the time predicted we would be using far more energy than we do now. The advent of the computer, the Internet, energy savings appliances and other efficiencies saved us a lot of money and a lot of oil. In 1970, our economy required 15,900 British Thermal Units of energy to support $1 of economic activity; by 2010 we needed only 7,300 Btus.

But there is a problem in repeating this feat. Today’s energy policy begins with the premise that we need to build more power plants, more refineries and more delivery systems. We do not try to first achieve greater efficiency. In other words, we build more energy infrastructure before we try to wring more work out of each unit of energy we produce. If we instead pushed efficiency first, the US could save $400 billion per year in energy costs, amounting to about $2,600 per household, according to ACEEE.

“The U.S. would prosper more if investments in new energy were not crowding out needed investments in energy efficiency,” said John A. “Skip” Laitner, ACEEE director of economic and social analysis.

In short, we are thinking small about efficiency, when we should be thinking big.

ACEEE further warns that the deck contains at least three jokers, or unwelcome wild cards, that could threaten our hand if we fail to pursue energy efficiency. These include 1) diminishing supplies of cheap and available energy; 2) a slowing rate of energy productivity and 3) climate change.

How do we keep the jokers buried? The report says it requires “a different recipe of technology investments” than we are now making.

“The question is will we choose to make those more productive investments?” says ACEEE.

ACEEE’s full report is available here.

Elisa Wood is a long-time energy writer whose work appears in many of the industry’s top magazines and newsletters. She is publisher of the Energy Efficiency Markets podcast and newsletter.

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Water is one of the most exciting sectors at the moment in terms of cleantech innovation. The industry has a huge variety of investment opportunities but at Carbon International we focus on identifying the areas that we believe are the most exciting within broad industries such as this, and uncover the companies and investors leading and innovating.

Two water sectors I’m particularly excited about, because I believe they’ll grow significantly over the next few years and beyond, are the produced water market, in the oil and gas industry, and wastewater from mining. These sectors might not be for purest cleantech investors but fossil fuels aren’t going away anytime soon. So we should focus on how to make them cleaner, cleaner in their use and in their extraction. The mining industry will always be with us. It’s worth remembering that much clean technology requires metals that must be mined, unless they are recovered from waste streams, thought this is not always doable. Companies that provide solutions to clean up these dirty industries will enjoy rapidly growing markets. Key for investors and corporations active in, or looking to enter, the sector, will be to seek out the most promising of these and we aim to provide some scope at least through our free London Environmental Investment Forum conferences.

‘Produced’ water market
‘Produced’ water is the term used to describe the water generated and used by the oil and gas industry. According to Global Water Intelligence, handling and treating this wastewater is an industry currently worth more than $5 billion a year in North America, and it’s growing fast. With conventional oil and gas – that is, onshore and offshore wells – having likely peaked in some regions, North America being one of them, energy companies are now focusing on ‘unconventional’ projects such as shale gas, oil sands and coal bed methane. Once too difficult and too expensive to exploit, widespread adoption of technological innovations such as hydraulic fracturing (‘fracking’) and horizontal drilling means these projects are now commercially viable – and they’re providing a real boost to supplies.

These ‘unconventional’ projects are highly water intensive however. On average, for every barrel of oil recovered, eight barrels of water are also generated. Over the next 15 years, this oil-to-water ratio is forecast to increase from 1:8 to 1:12. During this time, the size of the produced water market (in the US) is set double to $10 billion.

The main growth sector within this industry is advanced treatment. This refers to treating the produced water to a high level which allows it to be safely recycled or re-injected. Treating water to higher standards can relieve stress on local water supplies, reduce environmental concerns and improve oil recovery rates. The more that can be reused the better. Technologies include filtration, biological treatment and desalination. With the market for the latter projected to grow at more than 20% annually, this is a particularly promising area for investors and corporations operating in the oil services sector. Produced water is highly saline and if it’s to be reused onsite or sold for use offsite, the salinity needs to be reduced to a specific level. The winners will be providers of low cost solutions that offer superior water recovery rates.

Wastewater from mining

The mining industry is a huge consumer of water. As more mines are developed in water stressed regions, such as Australia, Chile and South Africa, the industry is under increasing cost, environmental and social pressures to secure water supplies in challenging environments and treat wastewater to higher levels. Mining projects with water issues are considered high risk investments and will struggle for finance.

This issue is creating a big opportunity for solution providers. The market for water services related to mining stands at $7.7 billion a year and if the industry continues to boom, this could double in the next three years. As mentioned above, one of the main reasons for this is the rising number of mines being developed in countries which already suffer from fresh water scarcity. Other drivers include more stringent government regulation and better corporate social responsibility practices which are leading companies to treat wastewater to higher standards. The mining and processing of great amounts of lower grade ore is also requiring bigger volumes of water.

Consequently, providers of flexible solutions for the supply of desalinated water from ground sources of from the sea, or those that can treat the highly saline wastewater so that it may be reused on or even offsite, look set to benefit. The growing desalination market is also creating opportunities for the disposal of waste brine.

Another interesting growth area is in the recovery of metals from mine tailings. Tailings or ‘slurry’ refers to the leftover ore and wastewater after the metal has been extracted during the processing stage. This waste material, which still contains quantities of valuable metals, is typically left to settle in large dams or tailings ponds before being disposed of. An opportunity exists here for solutions that can selectively recover metals from this waste stream, reducing its volume and providing additional revenue streams for miners.

Article by Tom Whitehouse. Tom is the Chairman of the London Environmental Investment Forum (LEIF), a conference platform which connects environmental innovation with capital, and the Founder and CEO of LEIF’s Initiating Partner, Carbon International, which provides corporate finance services to companies and investment firms operating in environmental and cleantech industries. The next LEIF conference is ‘Investing in water’, on March 16 at the London Stock Exchange. LEIF conferences are free for professional investors, corporations and entrepreneurs.

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My loyal readers may have been surprised (or relieved) by my hiatus from publishing.  I was not idle, however.  I led a study on Energy Efficiency Policy in New Jersey and Pennsylvania on behalf of the Department of Energy-funded Greater Philadelphia Innovation Cluster for Energy Efficient Buildings.  I completed the work last week, and it will be released soon. 

I have also been advising New Jersey Governor Chris Christie on developing the 2011 Energy Master Plan for New Jersey.  The draft plan is available here.  The findings of the eight-person work group on clean energy will be made public shortly, and public hearing is being held on October 21 from 9:30-12:30 at the Rutgers Eco-Complex.  Details are available here. 

My public sector work has given me some new insights into green building and energy efficiency policy, which will be developed in further posts over the next few months. 

Among the most interesting findings is the difficulty in crafting public policy initiatives to break through the “efficiency gap”—the gap between a customer’s actual investments in energy efficiency and those that appear to be in the consumer’s best interest.

Most policy efforts are aimed at eliminating the "first cost" barrier to energy efficiency.  In other words, providing grants or loans to minimize the upfront investment required for energy efficient systems.  

Making these programs work to achieve scale and realize significant energy savings has proven devilishly difficult.    With the influx of ARRA funds, state and local jurisdictions have invested $650 million in loan programs for energy efficiency projects, with loans generally provided to customers at low- or zero- interest rates. 

The author of a May 2010 nationwide study of state, utility and municipal loan programs by the National Renewable Energy Laboratory concluded:

Despite the advantages of state, utility and municipal loan programs, participation to date has been modest, and they appear to be incapable of driving a large scale transition to a clean energy future by themselves.

A study just released in September, 2011 by the ACEEE which reviewed 24 financing programs nationwide concluded that participation rates were generally low across programs, and do not generally track energy savings.  The report concluded:

While several programs have many years of experience and have issued thousands of loans, this market has yet to come to scale. 

So, it is clear that transforming the energy efficiency environment will require more than providing low cost capital from government sources for at least two reasons.  First, because government capital and capital deployment mechanisms are not robust enough to create scale, and second, because the barriers to energy efficiency are not merely financial.  Psychological barriers, cultural barriers, resource barriers and technical barriers also play important roles.  [This report nicely summarizes the various barriers to energy efficiency investment by sector.]

From my research, policymakers must focus on better stimulating private capital deployment and integrating financing with tools to address other barriers to energy efficiency. Understanding consumer motivation, providing resources to address the less concrete barriers to energy efficiency, and partnering with private capital sources to bring financing to scale  should be the goals of energy efficiency policies going forward.

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Greek officials are calling for an ambitious expansion of solar power generation in their sunny country, hoping that large-scale production of renewable energy will generate significant revenues and green jobs for the country’s troubled economy.

Greek Energy Minister George Papaconstantinou says his country’s solar power plan, Project Helios, would boost Greece’s solar power production from a paltry 206 megawatts today to 2.2 gigawatts by 2020 and up to 10 gigawatts by 2050.

Speaking at an energy conference in Germany, Papaconstantinou said Greece is hoping to attract 20 billion euros ($28 billion) in foreign and domestic investment to launch Project Helios, which could export solar-generated electricity to other European states.

Papaconstantinou said that the potential for solar power generation in Greece is enormous, as the country enjoys 300 days of sunny weather a year — 50 percent more than Germany. At present, however, Germany’s solar power production is 80 times greater than Greece’s.

Article appearing courtesy Yale Environment 360.

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The Global Cleantech Cluster Association (GCCA), known as the global voice of cleantech, announced today 185 companies have been nominated for the 2011 GCCA Later Stage Award by 30 cleantech clusters from around the world. Nominations in 10 categories ranging from renewable energy and energy efficiency, to waste, water and green building were announced at the GCCA/EcoTech Quebec Cleantech for EcoCities Conference at EcoCity Montreal. Winners will be announced in Dublin on November 14th, hosted by the cleantech cluster An tSli Ghlas -The Green Way. Winning companies will receive international investment exposure and business support throughout 2012.

“We are thrilled to have such a strong list of nominated companies for the 2011 Later Stage Awards,” said Ben Taube, Chair of the GCCA. “Truly ground-breaking and innovative technologies are developed everyday across the world. We are pleased to highlight the very best and recognize them with partnership exposure among other benefits.”

Over next three months, the nominations will be judged on a variety of factors, from technology innovation and business strategy to their ability to execute. In addition to the 10 categories listed below, the three Most Impactful Technology awards will be given to companies that are improving the quality of life for people around the world, particularly in developing countries.

“With the Later Stage Awards we are moving the global cleantech needle forward,” said Shawn Lesser of Watershed Capital and co-founder of the GCCA. “Because of this type of global awareness cleantech companies make it from localized markets into mainstream adoption.”

Of the 29 judges hand-selected for the Later Stage Award many are leading venture capital investors and entrepreneurs, including; Generationʼs Climate Solutions Fund (Al Goreʼs investment Firm), The Rockefeller Foundation, Dow Venture Capital, BASF Venture Capital and more.

“The list of judges is like a who’s who of cleantech investment. It’s a rare opportunity for these companies to introduce their technologies to nearly 30 investors all at once,” said Cal Hackeman, global leader for cleantech at Grant Thornton International, the top sponsor of the Later Stage Awards. “The GCCA’s Later Stage Award is a unique opportunity in the cleantech sector to showcase meaningful innovation and we are very proud to be a part of it.”

Nominations for the 10 Later Stage Award Categories

Advanced Materials

Agriculture

Energy Efficiency

Green Buildings

Renewable Energy

Solar

Transportation

Waste

Water

Wind

About the Global Cleantech Cluster Association
Global Cleantech is a non-profit association, headquartered in Atlanta, Georgia, U.S. that creates conduits for companies to harness the tremendous benefits of international cleantech cluster
collaboration in an efficient, affordable, and structured way. Global Cleantech provides a gateway for
established and emerging cleantech companies to gain exposure to potential investors, new markets,
influential networks, innovative technologies and best practices. GCCA was founded by swisscleantech,
the Finnish Cleantech Cluster, and Sustainable World Capital. For more information about Global
Cleantech, please visit www.globalcleantech.org.

About Grant Thornton International
Grant Thornton International is one of the world’s leading organisations of independently owned and
managed accounting and consulting firms providing assurance, tax and specialist advisory services to
privately held businesses and public interest entities. Clients of member and correspondent firms can
access the knowledge and experience of more than 2,500 partners in over 100 countries and receive the
same distinctive, high quality and personalised service wherever they choose to do business. Grant
Thornton International strives to speak out on issues that matter to business and which are in the wider
public interest and to be a bold and positive leader in its chosen markets and within the global accounting
profession.

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Speaking from a hybrid vehicle transmission company in Indiana, the President explains how investments in a clean energy economy are the only solution to high gas prices in the long term.

Transcript | Download mp4 | Download mp3

Check out an infographic below on the President's approach to gas prices, or download the full size version.

Download Full Size.

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Imagine the last time you took a trip between two American cities.  Maybe you had to wait in line at a crowded airport; maybe you spent hours in traffic in a car or a bus.  Or maybe you made the trip on a train that had to slow down over and over because it was running on outdated tracks.

Now think about the fact that over the next 40 years, the population of the US is projected to grow by 100 million, and consider how much that’ll increase the use of our roads, airports, and rail.  Now imagine what that same trip you took will be like if we don’t build the transportation infrastructure we need to accommodate those extra travelers.

The fact is, those folks are going to travel one way or another.  But it’s up to us whether they travel on the infrastructure of the past, or whether they travel on new 21st century transportation infrastructure that’s fast, modern, efficient, and environmentally friendly.

That’s why Vice President Biden traveled to Philadelphia yesterday to announce a comprehensive plan to help the nation reach President Obama’s goal of giving 80 percent of Americans access to high-speed rail within 25 years.  The President is proposing to invest $53 billion over the next six years to continue construction of a national high-speed and intercity passenger rail network, which will create tens of thousands of private-sector jobs while helping to lay a new foundation for our economy.

Building a national high-speed rail network is a key part of this Administration’s plan to out-build, out-innovate, and out-compete the rest of the world. As Vice President Biden said in Philadelphia today, public infrastructure investment increases private-sector productivity, promotes growth, and creates jobs. Transportation infrastructure is the lifeblood of the global economy; if we can’t move goods and people faster and more efficiently than our competition, there’s no way we’re going to remain the most prosperous and productive country in the world.

But why high-speed rail? Why not build more highways and airports?

Look at it this way: in dense, highly populated regions like the Northeast Corridor, building just one mile of one lane of highway costs $40 to $50 million. And it doesn’t get any easier when you look at airports; adding a single extra runway at Atlanta’s Hartsfield-Jackson Airport recently cost $1.3 billion. Worse yet, many of the airports in our most congested areas are surrounded by development and can’t be expanded, which makes it almost impossible to add more flights in and out of cities like New York.

And beyond the dollar costs of highways and airports, you have to consider their environmental cost in terms of increased carbon emissions: an Amtrak train between Philadelphia and New York can carry up to 500 passengers, and if those folks drove instead, they would use more than 1,900 gallons of gas. Not only is that roughly double the energy used by that train, but most of it comes from foreign oil.

But most important of all are the human costs of our aging transportation system. As the Vice President said today, “Think about the difference rail travel makes in people’s lives. I know, because when I was in the senate, it made an incredible difference in mine. Every minute you’re not stuck in traffic, or working your way through airport security, is a minute more that you can spend with your families.”

Billions of hours were wasted last year in congestion on American highways. And in our airports, the percentage of flights landing at least two hours late has more than doubled since 1990. Even on the Acela Express – the fastest train in the Northeast Corridor, which the Vice President rode today – it takes 2 hours and 45 minutes to get to New York City. That’s only about 45 minutes faster than in the 1940s.

We want to change that. Through our investments in high-speed rail, we’re hoping to cut the time for that trip to just 96 minutes. Over the next 25 years, our goal is to build high-speed and intercity passenger rail capacity equivalent to 1,900 miles of new highway, but with trains zipping along at up to 220 miles per hour in our most densely populated corridors. And we’re proposing to expand faster rail service to emerging and regional corridors as well, so that we can ultimately give 80 percent of Americans access to these core high-speed rail lines.

This is already happening in countries around the world, and as the Vice President said in Philadelphia today, there’s no reason we can’t do it here. Building a cutting-edge transportation system is the only way we’re going to keep leading the world. So let’s start building.

Article by Tobin Marcus, Deputy Economic Policy Advisor in the Office of the Vice President.

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Japanese government and industries are likely to invest $6.4 billion in green energy technologies over the next 15 months.

The Japanese government would offer subsidies worth $1.9 billion while the rest of the investment is likely to come from some 142 companies which include Fuji Electric Holding, Toda Kogyo Corp, Toshiba Corp, Sharp Corp and Panasonic Corp. Investments would be made in a wide range of green technologies like fuel-efficient cars, energy-efficient appliances, LED lighting systems and solar panels.

The $6.4 billion investment is expected to create about 10,000 jobs directly within the next 15 months as companies expand their manufacturing infrastructure and production capacity.

Other industries which provide services and equipment for the production of these green products would indirectly contribute in generation of another 85,000 jobs. This investment is likely to create an annual product demand worth $22.9 billion.

The Japanese government is pretty serious about lending credit to companies now that the country has learned the lessons from the global economic crisis. The government has made it clear that it wants to see solid results in terms of meaningful economic growth.

The head of green job creation and industrial facility section at the Ministry of Economy, Trade and Industry, Gun Saito said, “we regularly check the effect of job creation with companies that receive subsidies, and if there is no positive feedback we would deal with it strictly, including forcing them to return subsidies.

Japan is not rich in natural energy resources and is heavily dependent on import of energy products. After the global economic crisis and a slump in the domestic economy, the government unveiled massive long-term plans to invest in green energy sectors to ensure sustainable economic growth.

In 2009, the government announced an ambitious plan to expand its $745 billion green energy business sector to $1 trillion by 2020 thus creating about 800,000 new jobs.

Article by Mridul Chadha, appearing courtesy ecopolitology.

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The French government recently announced a large investment program for renewables and green chemistry. The investment, totaling 1.35 billion euros ($1.75 billion) will be allocated over the next four years.

Named “ Démonstrateurs énergies renouvelables et chimie verte ” – or renewable energy and green chemistry demonstration – this program plans to allocate 450 million euros in subsidies and 900 million euros in low-interest loans.

These sums will be allocated progressively : 190 million in 2010 and 290 million per year until 2014.

The program wants private investors and research organizations to join in to bring more than two billion euros to help finance all the projects.

The goal behind this is to spur innovation and the deployment of green technologies in energy and chemistry.

This is not likely to be the last program of its kind in France according to Bloomberg Businessweek:

The environment agency plans to open two other programs under the bill, including a 1 billion-euro plan to develop sustainable transportation and a 250 million-euro measure to develop smart-grid technologies, the spokeswoman said.

Indeed Nicolas Sarkozy’s government is fully aware of how such economic sectors can create local jobs and economic growth. For example, the wind energy sector already employs more than 7,000 people.

This was the reason why France wanted to launch a comprehensive green revolution. Called the Grenelle de l’Environnement, it has since its beginning in 2007, known both successes and failures.

Among the successes one can note the feebate system used to promote energy efficient cars and a zero-interest rate loan for housing renovation.

According to a study published last year by the Boston Consulting Group, the Grenelle could create up to 600,000 jobs.

France is known to have developed for the past decades an important set of nuclear reactors, which partially allow the country to have 90 percent low carbon electricity.

But as concerns over oil reserves and climate grow, it is willing to develop low carbon alternatives.

It seems that with this money, research on solar, wind and other low carbon energy sources will be boosted.

photo: Victor Radziun

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Germany, one of the more frequently discussed countries when it comes to investment in renewable energy projects through its highly touted feed-in-tariff, seeks to attract a new crop of young scientists to partner with German research institutions and corporations.

The Federal Ministry of Education and Research is sponsoring a competition called “Green Talents: International Forum for High Potentials in Sustainable Development.” They are seeking 15 outstanding scientists, 35 years of age or younger, in the following fields:

(1) Cleaner production in industry;

(2) Climate protection, adaptation to climate change, energy efficiency and CO2 reduction;

(3) Material and resource efficiency, sustainable resource management;

(4) Sustainable land-use management;

(5) Water technologies and water resources management; and

(6) Innovations in the service sector that are related to sustainability and sustainability strategies, policy-making, business and society.

Winners of the competition will be able to participate in a 10 day international forum this fall. During the forum, winners will travel throughout Germany visiting some of the leading universities, research institutions, and companies. Winners will be able to meet one on one with leading experts and have an opportunity to present their own research.

The Green Talents competition not only provides winners of the competition with exposure and opportunity to learn from experts in Germany, but also provides for a funded prolonged stay (up to three months) at a university, research institution, or company to further develop their research project.

The application deadline of June 20, 2010 is rapidly approaching. More information about the competition and application requirements can be found at www.greentalents.de.

Photo: Deutsche Welle

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