Noah Long's Blog: Solving Global Warming

NRDC investigation spurs DOE Subpoenas

2010-03-24T19:46:11Z

According to a press release sent this morning, the Department of Energy (DOE) issued subpoenas to three companies to investigate the manufacture or sale of torchiere (upward facing) lamps that may violate federal efficiency standards. Two of the three companies: Target Corporation and Addesso, Inc. are private labelers of lamps manufactured by Habitex Corporation. All three could be on the hook for lamps that fail to meet the minimum federal standard.

NRDC did a web search for products advertised as using more power than is allowed by federal standards. We found and bought Target and Adesso labeled lamps that were advertised as using 300W. We tested each model with a standard wattage meter and found that they could use more than two times the allowed 190W—with no evidence that the lamps employed a current restrictor to limit power consumption.

We sent this information on to DOE, and are very pleased to see they are taking steps to act on it. Appliances that don’t meet the minimum efficiency standards waste money and cause unnecessary pollution.

DOE has indicated that it will be ramping up testing for energy efficiency standard enforcement and ENERGY STAR. Increased testing is crucial to meaningful standards and labeling programs. The torchieres that we found are likely only the tip of the iceberg of energy wasting appliances.

Putting ENERGY STAR to the test

2010-03-23T21:43:03Z

More good news from DOE/EPA last week: the agencies intend to beef up testing of products using the ENERGY STAR label. ENERGY STAR is an important labeling program used to help consumers identify the more energy efficient models within a product category. The ENERGY STAR requirements are often used by utility, state and federal rebate programs to encourage production and purchase of the most efficient products available.

The ENERGY STAR program is a manufacturer self certification program. This means manufacturers are select the samples and in some cases use their own testing laboratory to develop the test data needed to qualify for the ENERGY STAR label. Given this arrangement, there is a potential for mischief. On several recent occasions ENERGY STAR qualified models failed to meet the ENERGY STAR requirements.

Until now, ENERGY STAR has done very little to verify that the products are performing as promised. To ensure consumers are getting the energy and operating cost savings they expect when they purchase ENERGY STAR labeled products, EPA and DOE need to ramp up their verification testing and enforcement program.

The good news is that last week, DOE and EPA announced that they will be increasing the level of attention they pay to testing and enforcement. For a start, DOE is doing some of its own testing with samples purchased directly from retail. They have already made clear they are willing to act on this information. They will be following that up with a more comprehensive testing program.

In order to make sure the testing works, DOE and EPA should make sure the testing is independent, transparent, and strategically targeted:

Independence: product selection and testing should not be controlled by manufacturers. Independent selection and testing will ensure that the models tested are representative of the models sold and that the testing is not biased by those who have a stake in the results.
Transparency: testing, collection and implication of failure protocols should all be publicly available, as should detailed test results. There is nothing secret about energy consumption. Public data will make sure failing products are exposed; build the credibility of the program; and help other jurisdictions prioritize their testing.
Strategic targeting: testing should be wide spread, but prioritized based on products/manufacturers that have had compliance troubles; energy savings implications; information from stakeholders and manufacturers; and data-sharing between agencies.

There's a new sheriff in town: DOE means business on energy efficiency standards

2010-03-02T23:35:44Z

Last year, DOE formed a new unit in its general counsel’s office to prioritize enforcement of appliance energy efficiency standards. This is a big step forward for DOE and signals that the days of foot dragging on efficiency are long gone. This is the first time the agency has pursued a meaningful enforcement strategy for energy efficiency. President Obama and Secretary Chu clearly see the benefits of energy efficiency and have moved quickly to pursue it.

Already the new unit at the general counsel’s office has made significant progress. Here are the major accomplishments so far this year:

On February 4th, DOE Instituted enforcement action against AeroSys, Inc. for failure to certify air conditioners and heat pumps. The notice proposes payments of $1,226,480 in fines. The manufacturer has 30 days to settle the claims or the Department will file actions to demand payment.
On February 2nd, DOE warned nine manufacturers that submitted incomplete certification reports. The warning letters identified data deficiencies and demanded it be submitted.
ON January 28th, DOE began enforcement proceedings against four showerhead manufacturers - Zoe Industries, Altmans Products LLC, EZ-FLO International, and Watermark Designs, Ltd.- for failure to certify 116 products. The notices propose joint penalties of over $3 million. The manufactuers had thirty days to settle the claims.
On January 26th, DOE withdrew the Energy Star label from 34 compact fluorescent lamp (CFL) bulb models. The bulbs were manufactured by 25 manufacturers. Off-the-shelf testing showed that the bulbs do not last as long as is required to use the Energy Star label.
On January 19th the U.S. District Court for the District of Columbia upheld DOE's enforcement of Energy Star requirements against LG when certain refrigerators failed to meet Energy Star requirements.
On January 7th, DOE entered a consent decree with Haier America to resolve a dispute over compliance with efficiency standards resulting from a defect in some Energy Star labeled freezers.

Obama and Chu’s DOE is clearly finding plenty of low hanging fruit for efficiency enforcement. These actions bring meaning to the energy efficiency standards—ensuring that the standards save billions of dollars, millions of tons of greenhouse gases, and protect consumers’ wallets and public health. My guess is that the violations DOE has found so far are only the tip of the iceberg and that more and improved testing will uncover many more. If you have information on efficiency violations, bring them to DOE. They have an open door policy. Of course, feel free to share them with NRDC, too.

Energy Efficiency Moving Ahead in Chile

2010-02-10T02:02:17Z

Chile put the right (green) foot forward in 2010 when it created a Ministry of Energy. For the last few years, President Bachelet has had an appointed Minister of Energy, but no formal Ministry. In addition to taking on energy efficiency and renewable energy policy, the new ministry will continue regulation of electric supply. Chile started taking energy efficiency seriously in 2005, when the government organized a National Program for Energy Efficiency. The effort took on increased significance in the 2007-2008 energy shortage caused by the cutoff of Argentinean gas supply and a drought that reduced Chile’s hydro-electric capacity.

The Andean nation is now starting to make real strides in energy efficiency, and the rest of the world is taking note – and taking an interest. On my most recent trip there, the refrigerator in my rented apartment showed the signs of progress.

The first thing I noticed is that it was small, considerably smaller than most of those sold in the US (see, it even fits between my fingers…).

Efficiency is not the same as conservation, but smaller isn’t necessarily worse, either. This little guy fit the apartment well and stores plenty of food and drinks for most urban dwelling families.

But before you start thinking energy efficiency standards drove down the size of refrigerators in Chile, think again! Refrigerators were among the first appliances regulated in California and the effects have been famously win-win: refrigerators efficiency standards have saved lots of energy and at the same time, prices have declined while the average volume has increased.

US Refrigerator energy use, volume and price over time

The new Chilean Ministry of energy plans to adopt refrigerator energy efficiency standards soon (hopefully this year). So far, what’s in place is a mandatory labeling program. The size difference is driven by other factors, likely cost and high electric rates.

The label demonstrates a big, user-friendly scale that indicates how this refrigerator measures up against other refrigerators (more like the labels in Europe than EPA’s Energy Star Label).

From what I heard, the label has already mostly moved the market towards the most efficient end of the spectrum. This suggests that, like Europe, they might be ready to upgrade the label.

Chile has also done labels for lighting products and the Ministry is hoping to promulgate lighting efficiency standards (like the ones that have passed Europe, the United States, Canada and Australia among others) soon.

All of this is good news. The key question is whether the President-elect, Sebastian Piñera, will maintain energy efficiency as national priority: let’s hope he does. In particular, Chile should step up efficiency efforts in the industrial and mining sectors, which make up the largest part of Chile’s electricity consumption. With that effort, efficiency will start to make a real dent in energy demand growth. The alternatives are bleak: a recent IEA report indicated that Chile’s electric sector could triple its greenhouse gas emission in the next 15 years from increased reliance on coal. Additionally, a proposal by a consortium led by Italian Enel to build five massive hydro-electric dams in Chilean Patagonia, mostly to feed the increasing energy consumption of Chile’s mining sector.

If President-elect Piñera moves in the smart direction, Chile is poised to be a regional leader on energy efficiency, and fostering that leadership should be a priority for the US government in its efforts to step up international cooperation on climate and energy policy.

Idaho at the leading edge of energy efficiency

2010-01-26T18:34:03Z

This weekend, Kate Galbraith of the New York Times wrote an excellent piece on the change in strategy at Idaho Power. The article noted that Idaho breaks the expected “red state/blue state” mold by aggressively pursuing energy efficiency. Idaho Power is grasping that customers don’t care at all about energy per se, they care about the services energy provides (as Amory Lovins famously quipped: people don’t care about BtUs, they care about cold beer and hot showers). It turns out that utilities like Idaho Power can provide energy services (cold beer and hot showers) a lot less expensively by helping their customers become more energy efficient than they can through building and running new power plants. As a cheaper resource, efficiency leaves more money in customer pockets, leaving more room for spending and saving- and helping create jobs in other sectors.

Efficiency programs can benefit all classes of customers, from home owners and small businesses to large industrial customers. At home, efficiency offers more comfortable, affordable homes. For business and industry, efficiency offers opportunities and support for equipment improvements, innovation and energy bill savings. Far from competition to economic development, efficiency is an engine for economic growth at lower cost.

The trouble with efficiency, as readers of Ms. Galbraith’s piece may have noted, is it doesn’t fit too well in the traditional regulatory structure of utilities. There are three basic problems:

Efficiency may be cheaper than coal or gas (often one third to one fourth the cost!), but it still has to be paid for. Idaho has implemented one way of doing this: Idaho Power covers the cost of their efficiency programs through a 4.5% efficiency rider. If efficiency is going to be a viable alternative to building new coal plants, regulators need to make sure that utilities can invest in it. Other regulators have opted to cover the costs by including them in volumetric rates. Allowing utilities to cover the costs of efficiency can lower customer bills (even if it raises rates), since participants in programs will use less energy and others will be stuck paying for fewer power plants.
Efficiency reduces energy sales: “Wait!” says the utility executive, “How am I going to cover my costs!” Under traditional ratemaking rates are set to cover costs based on expected sales volumes. If a utility sells less than expected, they fall short on fixed costs; if they sell more than expected, they take home more bacon. Under this structure, higher sales have a big upside and no downside. The solution is a regulatory fix discussed in Ms. Galbraith’s article: instead of setting rates purely on expected sales volumes, rates are adjusted to cover allowed non-fuel costs (upward or downward) based on actual sales volumes. This is called decoupling.
Efficiency isn’t profitable under traditional ratemaking, unlike wires and power plants where utilities can make “reasonable rates of return” (plus any extra they can make by keeping costs down). Again, regulators can change the game by allowing utilities to keep a small percentage of the savings customers see from efficiency programs. This means utilities only earn as their utility programs provide benefits to their customers. A utility should have a constant incentive to replace consumption with cost effective efficiency.

Utility regulation needs to turn a corner and Idaho is on the cusp of leading the way. Idaho’s utility regulator has already adopted the first two policies. The third is being discussed in Idaho now. Let’s hope Idaho continues its leadership by adopting an incentive mechanism to encourage even greater savings from Idaho Power.

With little fanfare, California steps up on energy efficiency

2009-10-07T20:31:44Z

Last month the California Public Utilities Commission quietly approved the largest state investment in energy efficiency on record. The $3.1 billion dollar investment will prevent the construction of 3 large power plants, save California customers billions of dollars, and take a big step towards reducing California's global warming pollution.

The investments, made by California's investor owned utilities, will pay for a wide variety of programs, including local government partnerships, efficient appliance rebates, improvement of energy efficiency codes and standards, improving efficiency of new residential and commercial construction, investments with manufacturers to improve lighting technologies, and the nation's largest energy-retrofit program for existing buildings (targeting 130,000 homes).

The utility investments show two important points that are too often ignored: first many climate change solutions will actually save people money and create new jobs and clean energy industries. Second, well thought out regulation can change a company's operating assumptions and incentives, as indicated by PG&E's recent departure from the Chamber of Commerce. Peter Darbee's thoughtful letter is just one example of the string of companies that are dissatisfied with the Chamber's attempts to confuse and delay real debate on national climate policy. Because of well designed policy, PG&E benefits greatly from well-made investments in energy efficiency, and can even profit from them, after they provide savings to California customers.

The Color of Money

2009-03-09T21:31:51Z

In his recent opinion piece in the LA Times, "Green Meanies," Dr. Edward Glaeser raises a point that many of us here in California are very proud of: On average, Californians consume only about 70% of the energy used by the average American.

What makes California so special? Why do we pollute less than our neighbors? While Dr. Glaeser attributed the difference entirely to weather, the real story behind California's success in reducing electricity consumption and greenhouse gas emissions started in the mid 1970s and continues today. Until the early 1970s per capita consumption of electricity in California was about equal to the national average and had been growing steadily along with the rest of the country. Starting in the mid 1970s, California began to adopt a suite of polices to reduce energy consumption. These policies continue to place the state in the lead on maintaining quality of life while reducing both electricity consumption and pollution.

California has reregulated the investor owned electric utilities, making reducing greenhouse gas emissions through energy efficiency into a profitable venture. As a result, investments in energy efficiency by the investor owned utilities will be over three billion dollars in the next three years alone! California continues to set the high bar for energy efficiency in building codes and appliance standards. The cumulative effect of these codes and standards is equal to 17% of California's annual electric consumption.

The result? California's electricity consumption per capita has stayed relatively flat over the last 30 years, while the rest of the country has nearly doubled its use of the (mostly fossil fuel fired) juice. Californians use 40% electricity per person and emit about 30% less global warming pollution than the average American. The difference also means lower energy bills and has saved Californian electric customers 56 billion dollars, money they have put to use improving their quality of life and creating 1.5 million new jobs.

In recent years California has grown even more ambitious. We passed AB 32, the California Global Warming Solutions Act, which requires that California reduce emissions to 1990 levels by 2020. We banned long term investment in electric power sources emitting more greenhouse gasses than a combined cycle natural gas plant. This year, the legislature will likely adopt a requirement that 33% of the state's electricity come from renewable sources by 2020. After only one week in office, the Obama Administration recognized CA leadership by directing the EPA to reconsider its denial of a waiver on California's global warming pollution reduction requirement for cars. These policies, more than just California's temperate climate, have made California the leader in emissions reductions.

Still, Dr. Glaeser seems to believe that the best thing California can do to reduce global greenhouse gas emissions is repeal environmental review legislation that supposedly prevents people from living in LA, San Francisco, San Jose and San Diego. In fact, Last year, California passed (and NRDC co-sponsored) Senate Bill 375 which requires the California Air Resources Board (CARB) to assign a green house gas reduction target to each of the state's major regions. Regions will then design strategies that achieve these reductions through land use and transportation planning. The bill provides improved environmental review for projects contained in the regional growth plans that achieve the CARB-assigned targets, making carbon-reducing development easier. Far from closing the door to new inhabitants, SB 375 will help us grow- if the growth is targeted in locations that will help us to achieve our global warming targets.

All of these polices will build on our history of success in reducing California's global warming emissions. The good news is that these California policies are available and ready for export. And while most folks won't move to California just to reduce their emissions footprint, they can take these policies home with them.

The Dirty Road Not Taken

2009-02-20T19:25:30Z

Rolling Stone recently reported on how California's leadership on energy policy may set the course for national policy under the Obama administration. There is good reason to believe that the administration is already taking real steps in that direction. My colleagues have discussed a number of the most exciting steps, including directing the EPA to reconsider California's request for a waiver to regulate global warming pollution from cars, and telling the DOE to get moving setting appliance efficiency standards, long a central pillar of California's energy policy. The new stimulus bill also includes funding for efficiency and public transit- great ways to get our economy moving again- and transform it into a more green economy in the long run. A number of my colleagues have blogged about the crown jewel of California policy: the Global Warming Solutions Act, which caps California's emissions and requires economy-wide reductions in the pollutants that cause global warming. We are all hoping that the federal government can also pass an economy cap and trade, but I will leave that for a later post.

Today, I am writing my first blog because I want to note another aspect of California's policy mentioned in the Rolling Stone Article: The Emissions Performance Standard (EPS). Passed in 2006 in Senate Bill 1368, the EPS prohibits new long term investments in any power plant that emits more global warming pollution than a combined-cycle natural gas plant. What this means is that electric utilities in California can not invest in new dirty coal-fired power plants, or make long term investments in the ones they own now, unless those plants utilize technology that limits their carbon emissions.

What makes the EPS such a good tool is that it is a technology neutral way to prevent investments in the most carbon-intensive energy sources. While the effect in California was to halt consideration of traditional dirty-coal plants, it doesn't ban coal outright. Instead, it allows investment electric generation of any sort, so long as it doesn't emit more carbon than the standard allows. The standard is set low enough to prevent traditional coal plants, and high enough to allow cleaner gas plants (important for grid stability for the moment, even as we ramp up renewables.) If power companies decide that coal is still a better investment, they are free to use it, so long as they limit emissions- leaving room for carbon capture and sequestration technology.

California is already less dependent on coal than much of the nation, but the EPS guaranteed that the no new dirty coal plants will be built until the California Global Warming Solutions Act (AB 32) comes in to full effect, in 2012. Now that Congress is following California's lead and considering climate legislation this year, the EPS would be a useful federal tool to off investments in dirty power sources until a more comprehensive program can be put into place. I hope President Obama takes a look at it. He certainly has enough Californians around to let him in on the secret.