1. 1 Making US Industry More Competitive: Increasing Energy Efficiency Lester B. Lave Electricity Industry Center Carnegie Mellon University

2. 2 USA

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6. 6 High # is worst Mark Levine, Lawrence Berkeley Lab

7. 7 Low # is worst Mark Levine, Lawrence Berkeley Lab

8. 8 High # is worst Mark Levine, Lawrence Berkeley Lab

9. 9 High # is worst Mark Levine, Lawrence Berkeley Lab

10. 10 Low # is worst Mark Levine, Lawrence Berkeley Lab

11. 11 High # is worst Mark Levine, Lawrence Berkeley Lab

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13. 13 McKinsey Analysis: $100 Bills on the Floor? McKinsey: Many projects have a negative cost of abating CO2 emissions Internal rate of return (IRR) of many energy efficiency projects is > 10% This implies that Companies are not making profitable investments – can this be? Ignorance, not SOP, dont have $, dont disrupt production, no managerial time

14. 14 Economists Vs. McKinsey Companies make all profitable investments! Consumers dont – landlord vs. tenant, time horizon, ignorance, etc. California spends $700 million/yr to get efficiency increases – payback in 3 years Energy efficiency is not easy, simple or cheap – major investment in time & talent Need to pay utilities for conservation

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16. 16 Electricity use per person in California and in the USA

17. 17 Increasing Electricity Efficiency In generation: –Lowering heat rates 15,000 to 7,000 BTU/kWh –Combined heat & power, distributed generation In use: –CFL, refrigerators, air conditioners, etc. –Parasitic loads, plasma TV –Automatic shutoff switches

18. 18 USA Energy Intensity (BTU/GDP) 1850-2006

19. 19 What is Sensible Policy? Is 1.1 cars per licensed driver enough? 2002 BTU/GDP BTU/pop GDP/pop Denmark 38 148 39 Austria 55 171 31 France 63 182 29 Sweden 72 244 34 USA 81 333 38