The Energy Efficiency Lifestyle: Four Major Ingredients 

International Symposium on Climate ChangeTokyo, Japan.

November 17, 2008

Overview

A Few Words About the Alliance Energy Efficiency: The World’s Greatest Resource Driving Energy Efficiency: Four Pillars

- Prices Matter: High Energy Costs = Savings

- Building Energy Efficiency Codes and Standards: Moving inefficient construction and products out of the market

- Consumer Education & Awareness: Transforming Markets

- Good Public Policies: The Cornerstone of an Energy-Efficient Society

What is the Alliance to Save Energy?

Business Leaders

Academia

Environmental Groups

Policy Leaders

The Alliance to Save Energy

Mission: To promote energy efficiency worldwide to achieve a healthier economy, a cleaner environment, and greater energy security.

The Alliance is… –Thirty years in the making

–Fuel neutral

–Staffed by 50+ professionals

–Active in policy, research, education, communications, technology deployment and market transformation

Energy Efficiency: Powering the U.S. Economy for 30 Years

America's Greatest Energy Resource Energy Efficiency and Conservation Improvements Since 1973

Have Reduced Annual Energy Consumption by 50 Quads

50

40

24

23

8

4

3

0.8

0 10 20 30 40 50 60

Geothermal, Solar and Wind

Conventional Hydroelectric

Wood, Waste, Alcohol

Nuclear Electric Power

Coal

Natural Gas

Petroleum

Energy Efficiency and Conservation

Quads

2007 Domestic Production Net Imports

Alliance to Save EnergyAugust 2008

Imperatives for Energy Efficiency:Energy Use is a Global Climate Issue

Share of Global Energy-Related CO2 Emissions by Country (2005)

China, 19%

Russia, 6%

Japan, 4%

India, 4%

Western Europe, 13%

,

Others, 32%

US Other Sectors, 13%

US Buildings, 8%

Source: Energy Information Administration

In the U.S., Growth in Energy Use Poses a National Security Threat

Saving Money: the Best Reason to Save Energy??

Prices Matter: High Costs = Behavior Modification

EE: The No-Cost Way to Reduce GHG Emissions

Energy Efficiency should be fully considered in GHG reductions. All items to the left of the arrow represent “negative marginal costs”

The Challenge? Market Distortions

Principal Agent or “Split Incentives”- Home builder versus buyer

- Utility versus customer

Transaction Costs- Lack of information on life-cycle cost for products and/or

paybacks for upgrades

Lack of Investment in RD&D and EE Programs Public Policies Essential Consumer Education & Outreach Essential

Building Energy Codes &Appliance & Equipment Standards Transform Markets- Eliminates availability of inefficient products and

construction

- Makes energy efficiency part of the package – consumers don’t have to think about it

- Building Codes “Lock In” Savings for Decades

Federal Legislation Pending- Would Drive 30% Improvement in Residential and

Commercial EE Codes by 2010; 50% by 2020 2009 Model Energy Code for Homes: IECC

Improves Efficiency by approximately 13% over 2006- EECC Sought 30% Improvement

ASHRAE Goal (Commercial) is a 30% Improvement in Efficiency in the 2010 Code Cycle

Driving Efficiency through Codes and Standards…..

Corporate Average Fuel Economy (CAFE) Standards Improved in the Energy Independence and Security

Act of 2007 (EISA) Sets standards for cars and light trucks achieving

35 mpg by 2020. Attribute-based standards, but Keeps car and light truck standards separate, dual

fuel vehicle loophole, old testing (so “35” really is about 28 mpg)

DOT to set standards for larger trucks, tire efficiency ratings

Light Bulb Standard U.S. set performance standards for general service

light bulbs, starting in 2012-2014 25-30% savings: will phase out traditional

incandescent bulbs Second standard in 2020 must achieve roughly 65%

savings Most significant appliance standard ever adopted

- Will reduce CO2 by 100 Mt/yr. by 2020- Will save $13 billion annually

Energy Efficiency is a Consumer Lifestyle Issue

The foundation is there:– According to EcoPulse 2008, 88.2% of surveyed

consumers report a positive association with the term ‘energy efficiency’

Consumer Education & Outreach is the way forward:– Innovative campaigns emphasizing energy-efficient

lifestyles

– Focus on “pocketbook” and personal/family benefits

Consumer Campaigns at the Alliance

Super PowersEPA, NYSERDA, AllianceNationwide TV & Radio (ABC, CBS, CNN)Consumer Website

Powerful $avingsDOE & Alliance PartnershipAll Media Outlets

The Power is In Your HandsIndustry, DOE, EPA, AllianceAll Media Outlets, Web & Collateral

Energy Hog DOE, Ad Council, Alliance, StatesAll Media Outlets Web, Collateral Materials

P&G ColdWater Campaign P&G, AllianceAll Media Outlets & Web

Eureka $mart House Energy-Efficiency ChallengeNBC Universal, Industry, DOE, AllianceOn Air, Web–Home Makeover Contest

The Drive $marter Challenge(www.drivesmarterchallenge.org)

Billboard advertising

Extensive media coverage

Interactive Website

Celebrity support Government support Corporate supportDriving & Car Maintenance Tip cards

But Consumers Want Help…

“Who Are You Going to Call…?

.....The Government!”

And the Government Responds….

Energy Policy Act of 2005 will by 2020:- Reduce U.S. energy use by 2%- Reduce electricity demand by 4%- Reduce oil use by 0%- Reduce CO2 emissions by 3%

Energy Independence and Security Act of 2007 will by 2020 (2030):- Reduce U.S. energy use by 4% (7%)- Reduce electricity demand by 4% (5%)- Reduce oil use by 5% (10%)- Reduce CO2 emissions by 5% (9%)

Estimates from ACEEE, ASE

Our Government at Work:Extension of Tax Incentives

New Homes Builder tax credit - up to $2,000 if 50% more efficient compared to 2004 IECCC code; $1,000 for an Energy Star manufactured home. (Through 2009)

Existing HomesHomeowner tax credit – 10% of cost of installing building envelope components consistent with IECC 2000; capped at $500; $200 can apply to windows. (Through 2009)

Commercial Buildings Deduction up to $1.80/sq.ft. for buildings designed to use 50% less energy than ASHRAE-90.1 (Through 2013)

Public Buildings: Assignable deduction!

270

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450

85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10

FISCAL YEAR

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10% Goal - 1995 (NECPA)

20% Goal - 2000 (EPACT)

30% Goal - 2005 (EO 12902)

35% Goal - 2010 (EO 13123)

25.6% Reduction, 2004 (Preliminary Data)

Actual Energy Use

And there is Leadership at the Federal Level…

Energy savings goals + report cards Public buildings Public procurement

Federal building energy/sq.ft. down 30% in 20 years

Good Policies – Help Deliver Energy Efficiency

R etail E lec tric ity S ales per C apita

0

2

4

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8

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1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

S ourc e : E IA Interna tiona l Net E nerg y C onsumption T a bles, 1980 - 2005; E IA Interna tiona l P opula tion T a bles, 1980-2005; Wa shing ton S ta te Da ta B ook; U.S . C ensus Da ta ; E IA E nerg y C onsumption E stima tes by E nd-Use S ec tor, 1960-2005, Wa shing ton a nd C a lifornia

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C alifornia

United S tates

Was hington

J apan

Wes tern E urope

A Look at President-Elect Obama’s Platform…

On Energy Efficiency– Reduce Electricity Demand 15% by

2020– Net-Zero Energy Buildings by 2030– Overhaul Federal Appliance Standards– 45% Improvement in New Federal

Building Energy Use by 2014– 25% Improvement in Existing Federal

Building Energy Use by 2014– 15% Overall Reduction in Federal

Energy Use by 2015– Flip Incentives for Utilities– Invest in a “Smart Grid”– Weatherize 1 Million Homes Annually– Invest and Incent “Liveable Cities”

EE GLOBAL 2009 April 27 -29, 2009 Paris, France at Palais des Congres de Paris Hosted by the Alliance to Save Energy Organized by an International Steering Committee

Chaired by Marc Bitzer, President, Whirlpool Europe; Jean-Pascal Tricoire, President and CEO, Schneider Electric; Nobuo Tanaka, Executive Director, International Energy Agency; Lena Ek, MEP; & Claude Turmes, MEP

Program created by an International Program Committee Chaired by Paolo Bertoldi, I.E.S. – Renewable Energies Unit, Directorate

General JRC, European Commission

Thank you!

For More Information….

Kateri CallahanPresident

Alliance to Save Energy1850 M Street, NW

Washington, D.C. 20036kcallahan@ase.org

www.ase.org202.857.0666