Addressing the crisis of global climate change, for some, means a big economic policy fix, such as cap and trade or carbon tax, or a big geo-engineering fix, such as loading the stratosphere with sulphur dioxide. For others, it means old fashion hard, slow work, such as getting more efficient in the ways we use energy.
As we discuss the elements of the various administrative or legislative programs designed to improve efficiency in energy usage, we should keep in mind that the actions and technology to achieve more energy efficiency are not a mystery, nor do many of them require substantial new research and development funding. Much of what we need is out there, now. This includes: using double-glazed windows; replacing old coal burners with gas-fired boilers, and electric water heaters with gas-fired or solar heaters, all with thermostats, timers and smart meters; upgrading light fittings with more efficient bulbs and automatic lighting controls; insulating buildings; natural ventilation; more efficient appliances; more efficient electric motors in industry; and renewable energy systems and fuel to provide the energy itself. On one level, energy efficiency policies and programs are cheap and easy to start.
Getting more efficient in how we use energy also creates a number of challenges, not the least of which is that it requires a change of behavior. An old Portugese proverb — To change one’s habits has the smell of death — suggests how difficult it can be to induce a change of habit.
Making things even more difficult, many people recently have developed a mistrust of arguments about the dangers of climate change. Calls for taking actions to be more energy efficient have been negatively impacted by such mistrust. The resistance comes from a variety of factors, including concerted attacks on climate change scientists and environmentalists from interests financed by the fossil fuel industry, the belief that recovering from the current, deep economic recession precludes spending money to prevent conditions that will not occur for decades, even a century, and a growing distrust of governments.
How to get around these blocks remains the challenge for those for whom climate change is a global disaster about to happen. In a recent effort, environmentalists in Kansas convinced a very conservative and climate-change-skeptic community to embrace cleaner more efficient energy by persuading people that such actions were founded on thrift (reduce your energy consumption and you’ll save money), patriotism (stop dependence on foreign oil), spiritual conviction (protect God’s earth), and economic prosperity (focus on green jobs). The aim was to unplug energy issues from the “charged arena of climate politics.” Those developing the project studiously avoided mentioning the words “climate change” or “Al Gore.” Many skeptics enthusiastically participated in the energy saving project and the towns reduced their energy by 5 percent — a marked success when a 1.5 percent reduction is usual in such efforts.
The challenge to change behavior is even greater for public sector employees as they do not see the results of any savings, in energy or costs, in contrast to homeowners who can see immediate results, especially if they have a smart meter. See iePEDIA entry for “smart metering.” A similar problem exists with respect to renters who usually pay for the energy used but have no incentive or opportunity to retrofit or otherwise maximize energy efficiency.
As energy efficiency efforts often rely on existing technologies, they are criticized on the grounds that they do not drive any research and development in alternative energy sources. This critical need for funding R&D is reflected in a recent report issued in the US by the conservative American Enterprise Institute and the liberal Brookings Institution and Breakthrough Institute arguing that policies focused narrowly on driving down clean-energy costs by improving technologies will win support from an electorate weary of “climate wars” that have long polarized political debates. The report calls for the federal government to directly drive innovation and adoption through basic research, development, and procurement in the same way it did with computers, pharmaceutical drugs, radios, microchips, and many other technologies.
To bolster the efforts at maximizing energy efficiency governments are adopting a variety of policy and practice initiatives. Some of the programs focusing on the public sector in the Republic of Ireland (RoI) and Northern Ireland (NI) are discussed below.
The European Union (EU) commitment to energy and climate policies relies on its 20-20-20 strategy. That strategy commits the Member States to achieve, by 2020, a 20% reduction in greenhouse gas (GHG) emissions, 20% of gross final energy consumption to come from renewable energy sources, and a 20% increase in energy efficiency. Of importance is the fact that the GHG reduction and the renewables targets are legally binding and allocated among the Member States of the EU. The energy savings target is only voluntary. In addition, the EU committed itself in 2009 to the reduction of its GHG emissions by between 80 and 95% by 2050 and energy efficiency and renewables are critical to achieving this target.
In addition to the EU non-binding commitment on energy efficiency, Northern Ireland is subject to the UK-wide Carbon Reduction Commitment (CRC) Energy Efficiency Scheme (the Scheme). This Scheme is mandatory and it started on 1 April 2010. It is central to the strategy for improving energy efficiency and reducing carbon dioxide (CO2) emissions, as set out in the UK Climate Change Act. The Scheme targets emissions and energy use from large non-energy intensive organisations in both the public and the private sector, which together account for about 10% of UK emissions.
In the Republic of Ireland, the government issued its Maximising Ireland’s Energy Efficiency: The National Energy Efficiency Action Plan 2009 – 2020 which adopts a commitment with regard to energy efficiency for the public sector, as well as other sectors of the economy. The government has committed to a 33% savings in energy savings for the public sector. The commitment is not binding.
Northern Ireland Program
The UK Energy Efficiency Scheme, in which Northern Ireland participates, provides financial incentives to reduce emissions by putting a price on carbon. It applies to both public bodies and to large, low-energy intensive businesses. About 20,000 public and private entities will be covered by the program, in one way or another, including large offices and retailers, banks, supermarkets, hotels, hospitals, schools and universities. The energy-intensive sectors of the economy, e.g., power plants and cement factories, are generally already subject to a Climate Change Agreement (CCA) or to the EU Emissions Trading System (ETS).
All the affected public sector organizations — central government departments and devolved administration departments (but not non-departmental public bodies or quangos)—are required to fully participate in the Scheme regardless of the amount of electricity they use (the “mandated participants”). Any other organisaton that had at least one half hourly meter settled on the half hourly market in 2008 will be required to do something. If the company’s total annual half-hourly-metered electricity consumption exceeds 6,000 MWh (equivalent to 6 million kWh at a cost of about £500,000), then it passes over the threshold and is obliged to fully participate in the Scheme. For many large businesses in the UK total consumption is recorded every half hour, and this information is automatically retrieved from the meter and passed directly to the energy supplier (the half-hourly meter criteria). The half hourly electricity market is used by suppliers and generators to calculate the balance or imbalance, in what is generated and supplied, using electricity supplies information that is recorded half hourly.
If the private organization does not meet the threshold, it must still file an Information Disclosure about how much energy it uses and the level of carbon dioxide (CO2) emissions from the use of a variety of fossil fuels, but not fuels used for transport or onward supply.
Here, in abbreviated form, is how the Scheme works for those that are required to fully participate, in both the public and private sectors. When fully operational, after a transition period, the entity buys allowances at the start of the year from a government sale based on the estimate of emissions by the entity over the following year. There is a cap on the total number of allowances sold, the sale is an auction with no fixed price, and one entity cannot corner the market on allowances. At the end of the year, the entity surrenders one allowance for each tonne of regulated CO2 emitted during the year. If the entity has more allowances than needed, as for example if it overestimated its emissions or took energy-saving actions, then it can sell the allowances to those who underestimated their emissions or bank them for future use. Participants can also buy allowances during the year if they determine they are going to need more than initially estimated.
The revenues from the sale of allowances are recycled by paying back participating entities based on how much they reduced their emissions. To determine this amount the government will produce a “performance league table” to be used to settle on the amount of refund. Those that reduce their emissions will get back more than they paid in; those that do not reduce will get back less than they paid for allowances.
Under the Scheme, participation is mandatory for Government Departments, including the Scottish Administration, the Welsh Assembly Government and Northern Ireland Departments, regardless of their electricity consumption. The rationale behind this requirement is, of course, that the public sector can lead the way, show an example to private entities, or drive innovations in achieving energy efficiency. As “mandated participants” these departments are obliged to comply with the terms of the Scheme as outlined above. All other public bodies will participate only if they meet the qualifying threshold for the Scheme. If not, then they are obliged to file an Information Disclosure. As part of the Scheme, equally applicable to private organisations, public-sector bodies are required to measure their core energy consumption, which consists of electricity consumption (from the electricity grid) and gas consumption (delivered through gas pipes). If other types of fuel account for more than 10% of the organisation’s total emissions, the organisation will also need to report that consumption.
The Scheme allows for self-certification but twenty percent of organizations will be audited each year and failure to comply with the reporting and other obligations carries penalties or fines.
Like any emissions trading scheme, there are critics, including the Friends of the Earth and the UK Committee on Climate Change. Some see such trading schemes as promoting the right to pollute by permissive emission of CO2 and they argue that these schemes will not deliver low-carbon investments, i.e., they do not drive technological innovation but instead preserve a high-carbon economy with existing technology.
Those in the public sector also complain that they already are subject to targets to reduce carbon emissions under the UK Sustainable Operations on the Government Estate program and as a result they may be beyond their capabilities to do even more. This remains to be seen.
As set forth above, the Scheme provides for the revenue to be recycled back to participants. Unfortunately, the UK government recently announced, as part of its Spending Review, that due to the serious deficit the revenues from the Scheme now will be turned over to the Treasury and not to the participants. Such a reversal will undermine other efforts to extend carbon taxes based on the promise that revenues will be ring-fenced, or at least substantially committed to programs, for climate change mitigation or adaptation.
Following a Green Paper seeking consultation on energy policy, and a White Paper adopting certain energy policies, the government issued Maximising Ireland’s Energy Efficiency: The National Energy Efficiency Action Plan 2009 – 2020 where it formally committed to a 33% savings in energy by 2020 for the public sector. For purposes of the policy, the public sector includes the Civil Service, commercial and non-commercial state bodies, the Defence Forces, An Garda Síochána, Health Service Executive hospitals, Local and Regional Authorities, schools and universities.
The range of public organizations covered by the program is much broader than the category of “mandated participants” in the UK Scheme, however, the RoI program is not mandatory, and there are no sanctions for failing to meet the target.
The scope of the problem with energy usage in the public sector is hard to pin down since there is no data available that provides the information just for the public sector. Instead, the government derived the public sector energy usage from taking the data available for “services sector” and then estimated the ratio of the commercial and public sector energy use. That estimate indicated that there was a 32% increase in energy use in the public sector during the period 1990-2007. Across the entire economy, Ireland’s demand for energy grew by 84% over the period 1990 – 2007, and it is projected to grow by 24% over the period 2007-2020, if no actions are taken.
The RoI program committed to forming, by 2009, a high-level Public Sector Energy Efficiency Working Group, to introduce Guidelines for Green Public Procurement, and to investigate the feasibility of mandating the 33% target for the public sector. The Working Group presumably would spell out specifically how the public sector would meet the 33% target.
To date no sector-wide Working Group has been established. Instead, according to the Department of Communications, Energy and natural Resources, the government is first gathering the data on energy usage and patterns of use by the public sector before developing proposals for more efficient usage. In the meantime, the Sustainable Energy Authority Ireland (SEAI) has established a more limited working group with certain local authorities to explore how energy can be saved in two key areas that use a substantial portion of energy: water services that use approximately 40% – 60% of the average energy consumption, and public lighting that represents a further 30% – 40%. This particular working group will identify achievable savings through expert analysis, implement energy savings projects with expert design using modern technologies and support through available grants, and evaluate what savings are possible.
The annual RoI procurement budget for the public sector is €16 billion, and procurement expenditure by public bodies across the European Union accounts for some 13% to 16% of the entire EU GDP. A Green Public Procurement initiative offers important opportunities for promoting energy efficiency by providing incentives to “move the market.” Simply put, if the public bodies buy only energy-efficient products or services, those are the products and services that will be provided by private companies and that will also be marketed to the private sectors, all of which would create economies of scale. The Green Public Procurement policy and practices are administered by the Department of Environment, Heritage, and Local Government and in May 2010 it issued a Discussion Paper – Towards a National Action Plan on Green Public Procurement. The consultation document focuses on six priority product groups: construction, cleaning products, food, uniforms and other textiles, paper, and electricity. Responses were due by August 2010.
The status of any investigation of mandating the 33% energy savings is unclear. The need for mandatory targets was affirmed in a study, Energy Savings 2020, on the energy saving policies necessary to meet the EU requirements. That study concluded that:
The option of introducing a binding energy savings target for end-use sectors at Member State level is the most compatible with existing EU energy and climate policies, covers the vast majority of identified cost-effective savings potential and ensures national commitment and accountability for achieving the target while providing maximum flexibility for implementation.
The study notes that the EU has learned that often only binding targets will achieve a policy objective as in the case of the renewable share of energy in final energy use and binding national emission targets from various air pollutants, including for example sulphur oxides and nitrogen oxides.
The rationale for imposing added burdens on the public sector, in both the NI Scheme and RoI program, is that the public sector can lead the way, or move the market. Such rationale often is more an aspiration than a plan.
More analysis of just how the public sector can serve as an example for the other sectors is needed to gather the support within the public sector, and beyond, for actions that often require a change of behavior and that are impacted by severe cutbacks. In the case of the RoI program, which is not mandatory, the reliance on the public sector is especially important since the 33% reduction in energy use constitutes more than 10% of the energy saving by 2020 for the entire economy under the EU non-binding target.
The governments may have erected energy-efficiency targets on the top of mountains across the island, but the valleys through which the public employees have to travel to get to those mountain tops remain enshrouded in mist.
The CRC Energy Efficiency Scheme Order 2010
The CRC Energy Efficiency Scheme
“Teesside outcry at Government’s ‘carbon tax’” www.nebusiness.co.uk/business-news/latest-business-news/2010/10/22/teesside-outcry-at-government-s-carbon-tax-51140-27525360/
Maximising Ireland’s Energy Efficiency: The National Energy Efficiency Action Plan 2009 – 2020 by the Department of Communications, Energy, and Natural Resources.
For the documents reflecting the development of the energy policy framework in the RoI, including the Green Paper: Towards a Sustainable Energy Future for Ireland (2006) and the White Paper: Delivering A Sustainable Energy Future for Ireland (2007) see www.dcenr.gov.ie/Energy/Energy+Planning+Division/Energy+White+Paper.htm
Department of Environment, Heritage and Local Government, “Green Public Procurement.”
DEHLG, Discussion Paper – Towards a National Action Plan on Green Public Procurement
ENERGY SAVINGS 2020: How to triple the impact of energy saving policies in Europe (September 2010). A contributing study to Roadmap 2050: a practical guide to a prosperous, low-carbon Europe. The study was conducted by Ecofys and Fraunhofer ISI in the period of December 2009 to April 2010 and the report was commissioned by the European Climate Foundation (ECF) and the Regulatory Assistance Project (RAP). www.roadmap2050.eu/contributing_studies
See iePEDIA section of irish environment for entries on “Geoengineering,” “Smart Metering,” and “Green Public Proceurement.”
“In Kansas, Climate Skeptics Embrace Cleaner Energy” New York Times (October 19, 2010). See link to this article in the “News” section of irish environment, entry for October 20, 2010 (archive for October).
“Climate Change Doubt Is Tea Party Article of Faith,” New York Times, October 21, 2010. www.nytimes.com/2010/10/21/us/politics/21climate.html?scp=1&sq=Skepticism%20on%20Climate%20Change&st=cse
American Enterprise Institute, The Brookings Institution, and the Breakthrough Institute, Post-Partisan Power- How a Limited and Direct Approach to Energy Innovation Can Deliver Clean Cheap Energy, Economic Productivity, and National Prosperity (October 2010). thebreakthrough.org/blog/2010/10/postpartisan_power.shtml
Ways for all of us to be more energy efficient:
Sustainable Energy Authority of Ireland Power of One program
US EPA, “What You Can Do.”
“Simple Actions to save Energy.” www.onechange.org/simpleactions/save-energy/