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Energy efficiency has yet to see a period in history more open to its products than now, thanks to a convergence of events: rising energy prices, concerns about climate change, and a desire to reduce use of petroleum products and promote clean energy. Several nations have set double digit goals to reduce their energy use and are backing plans with sizable government investment.
US President Barack Obama allotted $20 billion for energy efficiency as part of the nation’s federal stimulus package and set a target for the nation to reduce electricity use 20% by 2020. China, the world’s second largest electricity consumer, also has set aggressive efficiency goals. The nation in recent years built power plants at a rate of about 90 GW per year, nearly as much power as Germany has installed in total. In search of more cost effective, less polluting measures, China has set a goal to no more than double energy use by 2020. In addition, China and the US in late 2009 agreed to collaborate on building an energy efficiency industry. This is a significant step considering that together the two nations consume 40% of the world’s energy, so can achieve considerable economies in manufacturing energy efficiency equipment. Meanwhile, the European Union has set a target to reduce annual consumption of primary fuels 20% by 2020.
Still, the energy efficiency sector faces some obstructions, chief among them a reticence by consumers and businesses to adopt its products. New, smart technologies are expected to draw the consumer toward energy efficiency pursuits in the near future, as are plug-in electric cars that offer a possible revenue source to their owners. In other cases, technologies will be installed in power plants and transmission systems that energy consumers never see, yet benefit from. Thus in a recessionary economic period when many industries are waning, the energy efficiency industry appears to be on a strong, upward trajectory worldwide. This report shows how and why.
Key features of this report
- Analysis of growth in worldwide energy demand as energy supplies tighten and costs rise. Discussion of why these factors are causing nations to pursue energy efficiency.
- Review of common programs and legislation that foster greater use of energy efficiency, as well as barriers to its adoption.
- Review of major types of power plants and explanation of how they are becoming more efficient. Analysis of gas, coal, nuclear and cogeneration.
- Analysis of inefficiencies in electric transmission, including line loss and congestion. Review of solutions, such as infrastructure upgrades, specialized pricing mechanisms, smart grid and microgrid.
Scope of this report
- Understand the drivers behind the current worldwide effort to increase energy efficiency
- Analyze the opportunities available for investment in technologies that improve efficiency for energy consumers, as well as in vehicle fuel use and power production and transmission
- Be better-informed about the political and regulatory goals, plans and funding mechanisms for energy efficiency worldwide.
- Assess the attraction and the risks for your company of investing in new energy efficiency and smart grid technologies.
- Benefit from the report’s information to help make your company’s next international investment decision in energy savings or energy production.
Key Market Issues
- Growing energy consumption: Increased use of appliances in advanced economies, along with growing electrification in developing nations, will increase energy demand 44% by 2030
- Rising costs of energy production:- Construction of new generation facilities will increase energy costs. In the transportation sector, governments are trying to diminish reliance on oil, seeing it as a political and economic liability.
- Increasing political support for energy efficiency:- Governments worldwide have set aggressive targets to increase energy efficiency, and have devoted significant funds to encourage consumers to adopt energy saving technologies.
- The marriage of information technology and energy:- The semiconductor already has significantly decreased energy use over the last 40 years, a trend expected to continue, as the energy industry makes use of the Internet and digital devices to better monitor and control energy use.
Key findings from this report
- To serve this growing consumption, the world is expected to build more power plants and transmission lines, increasing electric generation by 77%, from 18trn kilowatt-hours in 2006 to 31.8trn in 2015, according to EIA.
- Energy efficiency is commonly viewed as the quickest, cheapest and least polluting way to meet growing demand for energy. Energy efficiency costs have held steady at about 2.5 cents/kWh in recent years, making efficiency at least one-third the cost of any new power plant.
- About two thirds of the energy from fuels used for power generation is lost during conversion to electricity.
- The majority efficiency losses occur in the conversion of heat energy to mechanical energy in steam driven generators at gas-fired, coal-fired, and nuclear facilities. These facilities provide nearly 56% of electricity worldwide.
- The way we now delivery power is inefficient. Transmission lines lose 2% to 4% of the power they move because of line friction.
Key questions answered
- How much will energy consumption increase over the next two decades. What parts of the world will see the greatest increase?
- How does energy efficiency compare on a cost basis against generation?
- Why do consumers resist energy efficiency and what innovations are in place to encourage their participation?
- What role does energy efficiency play in economic development. What is energy intensity and why is it important to a nation’s economy?
- How close are we to significantly increasing the efficiency of conventional power plants?
- Why are nations making transmission upgrades and expansions now and how will these investments improve the electric system.
Table of Contents
The Future of Energy Efficiency
Executive summary 10
Introduction 10
Energy generation 11
Efficiency in the grid 12
End-user efficiency: residential 13
End-user efficiency: transportation 14
Conclusion 15
Chapter 1 Introduction 18
Summary 18
Introduction 19
Too much demand, too little energy 19
Oil running out? 21
The world plugs in 22
What drives the use of coal? 23
Why energy efficiency is important today 25
Producing more with less energy 26
Climate change: driving factor 27
Legislation and market instruments 29
Utility decoupling 29
Energy efficiency resource standards (EERS) and white tags 30
Who are the buyers? 32
CO2 reduction schemes 33
Efficiency on equal footing with generation 33
Rebates, loans, tax incentives 34
Barriers to energy efficiency 35
Curing energy anemia 36
Chapter 2 Energy generation 40
Summary 40
Introduction 41
Combined cycle gas turbine 41
Cogeneration and trigeneration 46
Integrated gasification combined cycle 47
Supercritical and ultrasupercritical pulverized coal 50
Nuclear power 53
Improving efficiency for nuclear power 54
Additional opportunities for efficiency improvements 54
Market conditions driving investment in efficiency technologies 57
Market barriers to investment in efficiency enabling technologies 58
Chapter 3 Efficiency in the grid 62
Summary 62
Introduction 63
The grid and its significance 65
Why the grid needs to be changed 66
Restructured markets 66
Integrating renewable energy 67
Difficulty siting transmission 68
Technology solutions 70
New high voltage lines 70
Decentralized generation and microgrids 71
Microgrids 73
Smart grid 74
Software 76
Smart meters 78
Conclusion 80
Chapter 4 End-user efficiency: residential sector 82
Summary 82
Introduction 83
Residential energy consumption on the increase 86
Legislation promoting household efficiency 88
Main sources of household energy use 90
Heating and cooling systems 90
Ground source heat pump 92
Air Ducts 93
District heat and cooling 93
Lighting 94
Appliances 95
Smart appliances 96
Smart Home Automation 98
Building materials and building standards 99
Conclusion 99
Chapter 5 End-user efficiency transportation 102
Summary 102
Introduction 103
Growth in use of autos 104
OECD countries 105
Non-OECD countries 107
Energy efficiency in transportation 108
Technology challenges 109
Legislation promoting fuel efficiency 110
United States 110
European Union 111
China 112
An electrified transportation system 112
Hybrid Electric vehicles 112
Battery Electric vehicles (BEVs) 114
Plug-in hybrid electric vehicles (PHEV) 115
Fuel Cell Vehicles 115
Energy efficiency of electric vehicles 116
Chapter 6 Conclusion 118
Summary 118
Introduction 119
Global trends in energy efficiency 120
International Partnership for Energy Efficiency Cooperation 122
Energy straightjacket 123
Investment in energy efficiency 124
Economics of energy efficiency and possible savings 127
Potential of energy efficiency improvements on a global level 128
Glossary 130
Index 133
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