Reinventing Energy Efficiency in a Net-Zero World

For nigh on 50 years since the Arab oil embargo, energy security has been the goal in the U.S. and energy efficiency has been one method of achieving it for some. "Drill baby drill" has been the method for others, which is why policies change with every American presidential administration. Now, energy security is back on the menu. The bigger problem we face is not energy but carbon, which requires a different approach. However, most of the world still seems to have an energy efficiency mindset, given that reducing energy consumption does reduce carbon emissions.

But it's not enough. Energy experts Jan Rosenow of the Regulatory Assistance Project and Nick Eyre of Oxford University's Centre for the Environment recently wrote "Reinventing Energy Efficiency for Net Zero" for the peer-reviewed journal Energy Research & Social Science, where they say the rules of the game have changed:

"Energy efficiency has delivered the largest share of historic greenhouse gas mitigation. A significant part of this relied on replacing fossil fuel technologies with more efficient versions, often supported by public funding or driven by other policies and regulations. But the goalposts have shifted dramatically in recent years. The scale of the climate crisis means that full decarbonisation of the economy rather than partial reduction of emissions is now the target."

Rosenow and Eyre note that as the focus has changed from energy efficiency to reducing carbon emissions, improvements in efficiency helped but were not enough. They write: "Until the transition to zero‑carbon fuels is complete, as efficient use of fossil fuels clearly continues to have a value for carbon reduction. But ultimately, in a zero‑carbon energy system, however efficiently they are used, fossil fuels become obsolete and energy efficiency no longer reduces emissions."

But times and technologies have changed. In the buildings, transport, and industry sectors, a lot of the focus is still on energy efficiency improvements. But in all three sectors, there has to be radical decarbonization, which we know how to do: with buildings, heatpumpification; with cars, electrification; with industries such as steel, hydrogenation. They also say efficiency improvements may reduce carbon emissions, but lock them in at the lower level; see my super-efficient condensing boiler for an explanation of "carbon lock-in."

These alternatives didn't exist a few years ago and the electricity supply was pretty dirty, so stressing energy efficiency made sense. It was always a mantra that conservation was best, that "the cheapest energy is the energy we do not use." But it isn't necessarily so anymore. Rosenow and Eyre write: "The costs of solar and wind, which are the main scalable renewable energy sources, have plummeted over the last decade, and renewable electricity can now be produced at much lower cost than ever before. This, in turn, challenges the notion that energy saving technologies are always the lower cost option to reduce carbon emissions."

Here, Rosenow and Eyre challenge some closely held beliefs, especially among the radical energy efficiency crowd. It is a debate we have been having in posts—such as "What Do We Need More: Insulation or Heatpumpification?"—where we wondered if in an electric world, should we worry less about insulation and efficiency than we have?

"In the long-term, in a 100% RES [Renewable Energy] economy, additional energy efficiency no longer reduces carbon emissions. This does not mean it has no value, simply that in the absence of the need for emissions reduction, it will be economic, social, and energy security goals that become pre-eminent. So proponents of energy efficiency will need to look to other arguments, for example, the benefits that energy efficiency delivers for lower household bills, job creation, economic competitiveness, thermal comfort, and energy security. This should not be a surprise, as the dominance of carbon reduction in energy efficiency discourse is relatively recent. These other arguments have been central motivators of policy at other times, even within the last 50 years."

This has caused the reconsideration of super-insulated buildings like Passivhaus in favor of reliance on heat pumps in an all-electric environment, as promoted by the "electrify everything" gang. However, Rosenow and Eyre don't totally discount efficiency, noting that heat pumps work better in insulated buildings and the lightweighting of electric vehicles will increase range.

In their section on flexibility, they say when electricity is used matters as much as how much is used. They write: "Saving a unit of electricity during peak hours on a day with little renewable generation delivers significantly more carbon savings and environmental benefit than saving the same unit during hours of excess renewable generation."

This has been our argument in favor of making every home a thermal battery, to level peak demand and reduce overall demand. Energy efficiency still matters, just for different reasons.

Rosenow and Eyre conclude:

"Net zero and the wider shifts in energy systems pose new challenges to the traditional role of energy efficiency. Our analysis suggests that energy efficiency will become even more, not less important for meeting climate goals and achieving other societal goals. In order for this to happen, the benefits of energy efficiency have to be rethought."

Demand reduction through efficiency can speed the transition to renewable energy, but cannot be the goal on its own. "We note a mismatch of existing policies that too often focus on incremental improvements of fossil fuel-based technologies or deliver energy savings without differentiating what kind of savings, when and where they occur," write Rosenow and Eyre.

This is all music to this Treehugger's ears, with respectable academics reinforcing what I have been saying for years: reduce demand, clean up electricity, and electrify everything.