My editorial for this week:
The United States is more efficient at using energy than New Zealand. Taking into account our respective GDPs, the U.S. uses less energy per unit of production than we do.
The government’s Sustainable Energy discussion document (available at http://www.med.govt.nz/ers/environment/sustainable-energy/discussion/index.html) proposes that supplying energy is only half of the issue, and only half of the solution. How we use energy, the demand side, is just as important. Energy efficiency has had a very low profile here, especially compared with the Canada,Sweden and even the UK.
We are so inefficient in energy use that it’s going to be relatively easy for us to do better. We don’t need any new technologies, we just need to take up solutions where technologies are already in use internationally. Policy initiatives in place include assistance to poor households to retrofit insulation. However, other countries use much stronger policies, such as high incentives for more efficient vehicles, subsidies for hybrids, much stricter building standards and requirements for the use of solar water heating.
As well as just efficiency, we need to look at how and when we decide what energy to use. If prices could change on an hourly basis to reflect both demand and supply issues, then we would have more incentives to use energy more carefully. Market reforms already allow pricing signals to influence the consumption of large industrial users. Domestically, this kind of smarter demand could be implemented through household hot water tank controllers that look at the price as it changes through the day, and turn off when the price reaches a certain level. This would let consumers control their energy costs and make more informed decisions about buying electricity.
EECA is targeting a 20% increase in energy efficiency over the next eight years and this would reduce our emissions, reduce the pressure on supply and save us money. Demand-side management should also play a big part in this. However, if our efficiency increases by 20% while the total size of our economy grows at 2.5% for the next eight years, then our total energy use remains the same. Pete Hodgson said last week that “many people think that if we really are to get serious about this it will mean cuts of 50 to 60 per cent [of energy use].” We’ve got a long way to go.
Comments gratefully accepted. But to summarise, energy efficiency is easy, should be done and means that things don’t get worse. But we don’t need things to stay the same, we need them to get better, much better, pdq.