Can the USA stop using coal, oil, and nuclear energy by 2050, and can that transition prove economically advantageous? These two questions drove Amory Lovins and the Rocky Mountain Institute (RMI), a Colorado-based “think and do tank,” to write Reinventing Fire, a “roadmap for navigating the United States economy through the end of the fossil-fuel era.”
By 2050, the US economy is forecast to grow 158%. That substantial increase would normally mean more consumption, more energy, more waste. Not so, says a spokesperson for the RMI. They propose an alternative economy powered by no fossil fuel, no nuclear energy, and one-third less natural gas. The best part: the technology exists to make this happen right now.
Reinventing Fire does not present an impassioned plea to save the environment, improve health, wellbeing or security – instead, it charts a course for America to boldly step into the future and embrace a new economic paradigm which provides positive externalities while improving the economy. Reducing energy consumption as the economy grows is not some fantasy Lovins and his crew dreamed up; they’ve based their projections on hard facts. From 1977 to 1985, the USA reduced its oil intensity at an average rate of 5.2% per year while the economy grew. The same can be done right now.
RMI bases its analysis on generally-accepted future energy needs and a conservative projection of 2050, by which time businesses will use today’s technologies at a normal rate of return. The plan doesn’t ask for any new national taxes, subsidies, mandates or even for the pricing of carbon. It’s focused on businesses making the shift to a more efficient beyond-fossil-fuel economy. Doing so will cost the nation $5 trillion less to power itself. It’s simply good business.
Since 80% of the country’s carbon emissions come from burning oil and fuelling power plants, and nearly 75% of electricity goes towards powering buildings, Reinventing Fire focuses its plan on oil and electricity. They break their analysis into four key sectors: transportation, buildings, industry, and electricity. After 30 years’ experience collaborating with firms in those four sectors to back up their claims, they offer a number of key solutions. The following is a partial list:
Transportation:
Ultra-light low-drag autos – Using materials such as carbon fiber makes vehicle bodies cheaper and easier to manufacture. The technology exists to boost fuel economy by 50% (without electrification) just by cutting down on weight, aerodynamic drag, and rolling resistance.
Electrified autos & “feebates” – The electrification of vehicles can cut 63% of fossil fuel consumption by 2050. Regular “feebates” spark buyers and automakers to make the switch to electric. Manufacturing innovations and economies of scale drive prices even lower.
Productive vehicle use – Includes smart growth, smart information technology (IT) traffic and transport systems. If we smarten up, we can cut half of the average 13,000 miles per year which each American drives, and almost one-third of freight-hauling miles. Reducing vehicle trips improves the environment and saves money better spent elsewhere, while improving personal mobility and freight logistics.
Buildings:
Integrative design – If all involved in the building process did a better job collaborating (e.g. to shrink or eliminate buildings’ equipment usage) they could design more economical, energy-efficient buildings.
Building policies – As energy costs rise, building purchasers could benefit from better access to building energy-use profiles. Requiring disclosure of this information is a mandate that gives them the ability to make better decisions, while providing an economic driving force for improving efficiency.
Non-energy benefits – Statistics show that green buildings with LEED or ENERGY STAR certification charge an average of 3% higher rent, sell for 13% higher, and have improved occupancy rates. These external benefits are often worth more than the savings in energy.
Industry:
Energy-efficiency – Technologies exist to greatly reduce a company’s energy needs and energy losses, and improve energy efficiency while making use of waste energy. However, adoption is exceedingly slow. Making the change can result in a significant cost advantage for a company over its competitors.
Cogeneration – Combined heat and power applications can replace 60% of America’s 2010 coal-fired electricity. Unfortunately, at this point in time, technological limitations and regulatory hurdles prevent many industries from adopting these changes.
Dematerialization – Manufacturing is a low-margin business. Innovative designs which cut waste, recapture resources lost in the extraction and manufacturing processes, and which last longer and/or can be remanufactured should improve a company’s profit margin and increase business opportunities.
Electricity:
Renewables – Quintupling current utility-scale renewable capacity can deliver 80-90% of 2050 electricity needs at both a financial and environmental cost savings.
Superefficiency and renewable supply – Smart technologies and designs can deliver the same or better service, but at a savings of 70% less electricity per dollar of US GDP than in 2010. If power plants switch to renewable resource technology, they could generate over 20 times America’s total 2010 electricity use.
Incentivization – Rewarding innovation improves choice and enables fair competition, making the transition to renewable energies profitable and efficient. What’s needed? Better regional cooperation, more pilot projects to demonstrate workable technologies, distributed intelligence, and improved grid architectures.
Reinventing Fire makes it clear that this massive transition will not be easy, but that making the transition is easier than not making it. They point to the economic reality that whale-oil suppliers faced in the 1850s. At that time, whale oil was a major oil source, but before running out of whales, the industry ran out of customers. The same can apply to oil and coal.
Beyond the comprehensive research and in-depth analysis that went into Reinventing Fire, the book teaches us to dream large and doubt no more. We can envision a new world. We can reinvent the economy. The technology is already in place to do so, we just have to break out of the manacles of inertia and jump into action. The market reacts quickly to changes in price. Reinventing Fire connects the dots between energy efficiency and the market, to provide actionable solutions to reinventing the economy.
