6 days ago ... REINVENTING FIRE: A NATIONAL LEVEL LOOK AT WHERE OUR. ENERGY
FUTURE COULD BE HEADED. • 87% carbon reduction by 2050.
REINVENTING FIRE IN COMMUNITIES
FEBRUARY 22, 2014 OWEN SMITH, PRINCIPAL
INTRODUCTION TO ROCKY MOUNTAIN INSTITUTE
Rocky Mountain Institute advances market-based solutions that transform global energy use. We engage businesses, communities, and institutions to cost-effectively shift to efficiency and renewables, creating a clean, prosperous, and secure energy future.
REINVENTING FIRE: A NATIONAL LEVEL LOOK AT WHERE OUR ENERGY FUTURE COULD BE HEADED
• 87% carbon reduction by 2050 • 80% renewable system with no coal or oil • Criticality of energy efficiency • Biggest savings from transportation…with implications for electricity system • Reflects big changes in the way customers engage with energy
DEEP ANALYSIS IN FOUR SECTORS
A LOW CARBON FUTURE IS AFFORDABLE AND RELIABLE
Value of U.S. Energy Savings, 2010-2050
Renew: Hourly Operability
AN EMERGING BODY OF ANALYSIS FINDS SIMILAR RESULTS
United States
REFS
Europe
RF
RE-thinking 2050
SYNAPSE
State/Regional
Budischak et al. (Mid-Atlantic)
New York
Minnesota
Vermont
Roadmap 2050
CHANGING THE WORLD FROM THE BOTTOM UP
NEW TECHNOLOGY DRIVES NEW OPPORTUNITY
THE NEW CENTER OF GRAVITY FOR ENERGY STRATEGY AND POLICY IS AT THE COMMUNITY LEVEL
DECLINING SOLAR PV MODULE COSTS… Best-in-class Chinese Module Manufacturing Cost: Q42013E-Q42017E
Source: PV Technology and Cost Outlook, 2013-2017, GTM.
…AND FALLING SOFT COSTS IN US, GERMANY $4.93
$1.22
1.2
– Soft Costs
1.1
$2.21
Balance of System
$0.55
– Installation Labor
1 0.9 0.8
– Installer / Integrator Margin & Financing Costs – Hardware – Inverter
– Module
0.7
$0.19
0.6
– PII*
0.5
$0.33
$0.48
0.4 0.3
– Customer Acquisition
0.2 0.1 0
German Average Residential System Price
US Average Residential PV System Price
US Soft Costs
German Soft Costs
* Permitting, inspection, and interconnection costs
THIS MEANS SOLAR IS NEARING THE TIPPING POINT Residential solar PV break-even cost ($/W) in 2015 under base case assumptions
LEASING HAS BECOME THE DOMINANT STRUCTURE Status of solar leasing
IMPROVEMENTS IN TECHNOLOGY AND FINANCE ARE INCREASING OPPORTUNITIES FOR EFFICIENCY INVESTMENT
POLICY CAN SUPPORT SCALING THESE SOLUTIONS
A SPECIFIC INDIVIDUAL COMMUNITY: FORT COLLINS, COLORADO
RMI’S ANALYSIS APPROACH The Right Steps in the Right Order 1. Identify what is possible, both technically and economically 2. Then, develop goals and implementation plans Whole-System Approach with focus on three key questions: 1. How much can building efficiency be improved? 2. How much of Fort Collins’ electricity supply can be derived from clean local resources? 3. How much can the city reduce fossil fuel use from transportation? Analysis methods drawn from: • Reinventing Fire, published studies and analyses • Adapted to Fort Collins with data and assessments provided by Fort Collins Utilities and the City of Fort Collins • RMI’s research and advisory work with cities and states, universities, building portfolio owners, and industrial clients
ASSUMPTIONS • Currently available technologies (e.g. 61 building end-uses commonly addressed in DSM programs) • Industry-accepted cost projections (e.g. Bloomberg New Energy Finance and EIA’s Annual Energy Outlook for levelized costs of energy) • Incorporates implementation rates observed in best-of-class (e.g. Gainesville and Germany for solar PV penetration, Efficiency Vermont for annual efficiency savings) • Customized to Fort Collins’ infrastructure and demographics (e.g. data from Platte River/Xcel for building stock and electricity generation breakdowns)
FORT COLLINS’ ENERGY USE TODAY
BUILDINGS
31% IMPROVEMENT IN EFFICIENCY IN BUILDINGS
ELECTRICIT Y
NET ZERO ELECTRICITY SYSTEM
NET IMPACT ON ELECTRICITY COSTS AND RISKS 2030
2050
TRANSPORTATIO N
48% ENERGY USE REDUCTION IN TRANSPORTATION
EFFICIENT AND ELECTRIC VEHICLE OPTIONS
WHAT DOES IT ADD UP TO?
SUMMARY OF KEY FINDINGS • Combining results across all sectors, the accelerated scenario results in a net benefit of $260 million for the community, while reducing CO2 emissions by 15 million metric tons. • Greater investment in local energy resources reduces annual cash outflows from the community to pay for coal and natural gas fuel by close to $16 million. • Local investment in efficiency, distributed solar, smart grid, and other local energy assets would be higher by $20 million per year.
• We estimate that this shift would generate at least 400–500 jobs over the entire period from 2013-2030. • Accelerate carbon goals by 20 years
NET PRESENT VALUE COSTS AND BENEFITS TO 2030
NET PRESENT VALUE COSTS AND BENEFITS TO 2050
APPLICATIONS FOR OTHER COMMUNITIES • Apply a whole-systems approach (all energy sectors) • Take the right steps in the right order – assess technical and economic potential before developing goals and plans • Recognize that clear aspirational goals align stakeholders and attract financial support and innovation partners • Increase information transparency • Implement new approaches to increase enthusiasm and adoption • Tailor programs to specific market segments • Offer new financing solutions • Create a highly trained, efficient workforce • Drive down distributed resources’ costs and value appropriately • Support the integration of emerging technologies • Double down on smart growth, alternative transit modes, pricing signals, and intelligent transport systems • Incentivize the purchase of electric vehicles
Walker, there is no path The path is made by walking —Antonio Machado (1875-1939)
Creating a clean, prosperous, and secure energy future TM
