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[1THING] Blog: Archive for April, 2013

[ Renewable Energy Not Growing as Fast as Necessary, Reports Say ]

The sun sets behind the turbines of Elk River Wind Project in Kansas. Photo by Mark Thiessen, National Geographic.

The sun sets behind the turbines of Elk River Wind Project in Kansas. Photo by Mark Thiessen, National Geographic.

On the road to more sustainable, clean energy, the ride has been bumpy. That’s the message to two reports this week—one from the International Energy Agency and one from the Pew Environment Group—that measured progress on transitioning from fossil fuels to clean energy.

Renewable energy has stalled, both analyses point out, for a few different reasons. A big one was the global recession, not helped by enduring low cost of fossil fuels compared to cleaner alternatives. But chiefly, it’s a result of a lack of global investment in new energy research to bring down the cost of still-expensive technologies like solar, wind, biofuels, hydropower and geothermal. That reality makes it harder to imagine a way the world can limit temperature rise to 2 degrees C (2.6 degrees F) by this century, a threshold climate scientists have set to avoid the worst effects of climate change.
Who’s winning and who’s poised to own the clean energy future? Here’s a look at the top five takeaways from the reports:
1) The U.S. is losing the race. Last year, China’s investment in clean energy sources rose 16 percent to $101 billion, landing it in first place. Virtually every other leading country, from Germany to Italy to Spain—did the opposite and scaled back investment. But none more than the U.S. No matter how you slice it, from government research to production tax credits, U.S. investment has fallen, down 37 percent in 2012. Solar and wind are expected to contract this year. As a result, the United States, which has long held the top ranking has now slipped to number two.
2) Watch out for South Africa. It’s still in ninth place globally, but that’s a big boost from last place among G-20 developed countries just a year earlier. Committing $5.5 billion to large scale solar and wind projects, the government upped it’s year-to-year investment by 20,500 percent.
3) It’s not all bad news. Despite lackluster investment, deployment of solar and wind power is still growing. Last year, the use of solar around the world increased 42 percent; wind grew by 19 percent. It’s mostly a result of emerging economies like Brazil and India catching up to where the U.S. and Western Europe have been for half a decade, but the capacity is being added as those countries’ energy demand quickly rises.
4) Wind dominates solar. While both are lumped together as neck-and-neck renewable sources, wind energy eclipses solar energy by more than double. Last year, wind power globally produced 280 gigawatts (GW) of energy, compared to solar’s 104 GW. China, again, is responsible for the most, followed by the U.S. and Germany.
5) CCS is still a pipe dream. The technology known as carbon capture and sequestration, which would bury greenhouse gasses deep underground, still hasn’t gotten on its feet. It was once billed as a silver bullet to stop putting gasses into the atmosphere, leaving energy analysts to project the world would need the capacity to trap 260 million tons of gas by 2020. With only 13 CCS demonstration projects around the world—and none in commercial operation—we’re barely a quarter of the way there.

[ Inside the Wind Power Industry’s Report: 10 Geeky Facts ]

We’ve known for months that 2012 was a huge year for wind power in the United States, so the headline from the wind industry’s big annual report released last week – that wind power grew by 28 percent – was a little stale.

But poring over the 108-page document – provided to us on a review basis by the American Wind Energy Association, so no link, sorry – did reveal a healthy list of interesting and sometimes eyebrow-raising factoids for the wind geek to ponder. Check out our 10 favorites below.

1. Turbine Total: There were 45,125 turbines operating in the U.S. at the end of 2012, providing 60,007 MW of cumulative installed capacity.

2. Power on the Grid: All those turbines churned out 140 million megawatt-hours of electricity in 2012. That was 3.5 percent of U.S. electricity production, a big jump from the 2.9 percent wind provided in 2011. And remember, many of those turbines that were spinning at the end of the year didn’t have a full year of production – so even if there were no new installations, production would rise in 2013.

3. Public vs. Private: 59,161 megawatts of the installed U.S. wind capacity is on private land. Just 816 MW – 1.4 percent – is on public land.

4. Small Farms and Big Farms: A lot of wind projects are just a single turbine – 48 of the 183 built last year. Another 15 projects consisted of two turbines. Remove those from the total, and the remaining projects averaged 108 MW.

5. Generational Change: The 6,751 turbines installed in 2012 had an average capacity rating of 1.95 MW. In 1990, the average rating was 250 kW.

6. Ever Higher: Some 2,0000 turbines – around 30 percent of all turbines installed in 2012 – had hub heights over 80 meters (262 feet) and more than 1,000 turbines soared at least 100 meters (328 feet). In 2011, only 10 percent topped 80 meters.

7. GE Dominates: 3,003 of the turbines installed in 2012 were from GE, with second-place Siemens a long way back at 1,116, followed by Vestas at 812. Cumulatively, GE is responsible for 24,085 MW of the 60,007 MW installed, far and away the leader.

8. Who Owns the Wind: NextEra Energy Resources is far and away the leader in “managing ownership” of U.S. wind farms, with 9,814 MW of capacity, just shy of one-sixth of all the capacity in the country. Iberdrola is second at 5,446 MW.

9. Who Uses the Wind: Xcel owns or contracts for 4,897 MW of wind capacity, tops among the nation’s utilities. And in 2012, San Antonio’s CPS Energy became the first municipally owned utility to contract for more than a gigawatt of wind.

10. It’s a Republican Thing: The top eight and nine of the top ten U.S. congressional districts for wind are held by Republicans. Leading the way is Republican Rep. Randy Neugebauer’s 19th District in Texas, taking in Lubbock and Abilene in windy West Texas, with 4,829 MW of installed capacity. That’s 8 percent of the nation’s total.

—Pete Danko

This post originally appeared at EarthTechling and has been republished with permission.


[ Purdue’s ‘Cinderella Story’ at the Race ]

This being my first year attending Shell Eco-marathon, I didn’t expect anything more than what my club members had told me. A hectic schedule, few hours of sleep, and sunshine filled days was all I expected. What ensued encompassed my expectations and then continued far beyond when our story turned into what a neighboring team called “A Cinderella Story.” The stress of last-minute fixes and the fearful possibility that we may not register in time brought out a collaborative teamwork amongst us which made us appreciate each other in a new light. Winning on our last and only qualifying run gave me a memory and sense of pride that I will hold for years to come. However grand that feat was, it is not the moment that will stay with me when I think of my experience at the race. (See related post:
A Movie-Like Ending at Eco-marathon.”)

What I will remember are the teams who took a curious interest into what we had poured our lives into for the past two years. I will remember the friends our team made with others as we learned about the different angles of engineering we each had chosen, the generosity of those teams who had given up a member to help a competing team, and I will remember the kindness of those who were surrounded by what they loved. Building cars and racing them in a true, well matched competition. Shell Eco-marathon brought about sportsmanship as I had not seen on a field or court for many years. On behalf of Purdue Solar Racing, I would like to extend my humblest gratitude to all those teams we met, especially to Saint Thomas Academy. It was an honor to meet and compete against you and I, along with PSR, look forward to a rivalry competition for years to come. It was a weekend I will never forget.


[ Peak Oil Flip-Flop ]

There’s a new twist in the “peak oil” debate. Is it good news for the climate?

Peak Oil Question Remains, Debate Continues

Ever since M. King Hubbert advanced the theory of peak oil in 1956, experts and non-experts alike have been debating about timing and relevance. (See herehere, here and here.) Hubbert’s argument seems like a no-brainer. Oil is a finite natural resource, so there must come a time when oil production peaks and begins to decline. The question is, when? And for a world economy that is largely fueled by oil, that “when” question is quite germane. If peak oil hits while oil demand is rising, it could spell worldwide economic disaster.

The world of oil punditry is replete with predictors of an imminent arrival of peak oil. (See hereherehere and here.) Folks bullish on oil, on the other hand, have long held that that time is way in the future, that there is plenty of oil in the ground and that whenever supply begins to be outstripped by demand, new technologies will be developed to get at what had been deemed to be economically unrecoverable.

History Shows That When Oil Prices Rise, Oil Production Responds

The historical verdict, so far, seems to be in favor of the oil industry bulls. Each time dwindling supplies and/or surging demand have caused oil prices to rise, the economics of high oil prices have spurred the development of new sources to quell the imbalance.

The latest ups and downs in the economy and the oil industry seem to follow that scenario. Remember the skyrocketing gasoline prices of 2005 and 2006 before the July 2008 peak? As in previous oil shocks, there were warnings that peak oil had arrived and that we should all get ready for even higher prices at the pump.

But that didn’t happen. First we were “saved” by the economic crash of 2008 — which some argue was actually “a direct result of peak oil.” The crash caused demand for oil and therefore prices as well to fall. Lots of folks, myself included, assumed that the reprieve from the economic slowdown was temporary and that oil prices would rise, possibly even more sharply than before once the global economy got going again.

Crude Oil Prices 1986-2013) (Source: U.S. Energy Information Administration)

Fortunately that hasn’t happened. The economic recovery, while tepid, is underway. And while oil prices have recovered somewhat, they have not hit the July 2008 peak, let alone shot above it. (See related: “Outlook for U.S. Gas Prices: A Bit Lower This Summer“)

So what’s going on? As you might expect, there are a variety of opinions. Some continue to warn that a spike in prices at the pump is just around the corner — for example see these predictions (here and here).

Others claim that we are seeing the same demand-and-supply response that we’ve seen in the past. The runup of oil prices in 2007 and 2008 sparked new investments that have increased production and moderated prices. And this argument is supported by data showing an approximate 10 percent uptick in world oil supplies since 2009.

A New Paradigm Proposed

But now two new reports — “Global Oil Demand Growth — The End is Nigh” by Seth Kleinman et al. of Citigroup and “The End of an Era: The Death of Peak Oil” [pdf] from Robin Wehbé et al. of the Boston Company — argue that something entirely different and rather unprecedented is underway. Both reports argue that we have entered a new era, one characterized not by the spectre of a supply peak, but by a demand peak that will assure that demand will not outstrip supply for quite some time to come.

The reasons for peak oil demand:

  1. Fuel economy. Recall the new fuel efficiency standards (known as CAFE, short for corporate average fuel economy) promulgated by the Obama administration with the support of the automotive industry? They will certainly have a moderating influence on U.S. oil demand. But the United States isn’t alone. Fuel economy standards are tightening throughout the world, including in China, the European Union, Japan and Canada. Fuel efficiency is expected to rise for trucks as well. The net result — global fuel efficiency on cars and trucks, which has languished for decades, will increase annually by about 2.5 percent.
  2. Substitution of natural gas for oil. The authors project that the revolution in natural gas supplies wrought by shale extraction will have a major ripple effect on the oil industry. Huge new supplies of natural gas [pdf] will continue to lead to low prices in natural gas and that in turn will lead to substitution of natural gas for oil. (Indeed this has already begun.) As a result. we’ll see a shift in the following:
    • Transportation, especially for trucks and other large vehicles currently powered by diesel.
    • Power generation. Though not very common in the United States, oil is still used to generate electricity. For example some 8 percent of New York State’s electricity is generated from oil, and in 2008, worldwide, about a trillion kilowatts of electricity (out of a total of 19 trillion kilowatts) was generated from oil. Kleinman et al. predict that is about to change as old oil-fueled power plants are replaced by gas-fired ones.
    • Petrochemicals too. Currently the petrochemical industry primarily uses oil as a feedstock. But natural gas, especially so-called wet gas, contains ethane, which can also serve as a feedstock for chemical synthesis. Low natural gas prices have already begun the substitution that the authors predict will accelerate into the future.

Of course for this to happen on a global scale, natural gas must become a global commodity that can be traded and transported from producing regions to consumers. No problem, say Kleinman et al. — the answer will be liquid natural gas (LNG). They opine:

“[O]nce the next wave of LNG export projects comes to market … global LNG markets should loosen materially. This raises the prospect of lower spot prices, and a greater incentive for gas for oil substitution to spread and accelerate globally. Hence, the assumption that substitution outside of the US starts to accelerate post 2016.”

But that’s not all. The Boston Company goes even further, arguing that the emergence of peak oil demand is being also driven by an unprecedented shift in consumer behavior. For years the accepted wisdom has been that consumer demand was inelastic with respect to price — in other words, even if prices change, demand remains much the same. The Boston Company report points to data since 1970 showing that each time the price of oil rose above 3 or 6 percent of gross domestic product, demand was reduced or quickly curtailed. Thus, they argue, price, not supply, now limits demand.

Suffice it to say — and I’ll note this is par for the course when it comes to the peak oil debate — not everyone agrees with these predictions (see chart).

Oil Demand Forecasts

Citigroup forecasts a very modest increase in demand that plateaus near 2020 (see also Fig. 1, page 2) while BP and the International Energy Agency (IEA) project a larger, steadily increasing demand of 0.7-0.8 percent. I expect the projected demand growth in the U.S. Energy Information Administration (EIA) forecast will be revised downward in the report due out this spring. ExxonMobil projects a 1.5 percent annual increase in demand from 2010 to 2025. (See End Note for sources.**)


Could Climate Be a Winner?

At least on the face of it, the projections of Citigroup and the Boston Company if they pan out would be good news for the climate. The world is replete with hydrocarbons and it may very well be true that, as the oil bulls have been telling us, technological innovation will make it possible for us to economically pull all the hydrocarbons in their various forms out of the ground to burn them if we so choose. And it certainly seems like advances in fracking and horizontal drilling have moved us a big step closer in that regard.

The questions we should be asking ourselves are: Do we want to pull all this stuff out of the ground, and How much is too much before the climate price is too dear to pay for cheap oil?

The fact that oil demand may be flattening out is a positive sign for the climate; at least the near-term pressure to pull all the oil out of the ground as fast as possible has lessened. (A caveat here: some of the oil demand flattening is due to switching from one fossil fuel — oil — to another — natural gas, which while cleaner than oil, still puts carbon dioxide in the atmosphere when burned.)

Interestingly enough, this peak oil demand phenomenon, if it comes to pass, will have occurred of its own accord without a global accord on carbon emissions. Is the system somehow correcting itself on its own? If so, the “system” better get busy because there’s a lot more to do — not just flattening demand but actually turning the demand curve downward, and not just for oil but for all hydrocarbons. Tall order. Maybe the “system’s” response will be to engineer a global climate treaty. And if that happens, who gets the credit?

End Note
** Sources for chart: “Global Oil Demand Growth — The End is Nigh,” Seth Kleinman et al., Citigroup, March 2013. Energy Outlook 2030, BP, January 2013 (data [xls]). North America leads shift in global energy balance, IEA says in latest World Energy Outlook, International Energy Agency, November 2012. “International Energy Outlook 2011,” U.S. EIA, September 19, 2011. “The Outlook for Energy: A View to 2040,” ExxonMobil, 2013.


[ Asia’s Accelerating Energy Revolution: India ]

In late 2012, the Rocky Mountain Institute’s cofounder, chairman, and chief scientist Amory Lovins spent seven weeks in Japan, China, India, Indonesia, and Singapore observing Asia’s emerging green energy revolution. In February 2013, he returned to Japan and China. Japan, China, and India—all vulnerable to climate change—turned out to be in different stages of a “shared and massive shift” to a green energy future, one with remarkable similarities to RMI’s Reinventing Fire vision for the United States.

See part one: Japan Awakens and part two: China Scales

India Starts Tipping

So what about the country that—together with China—is responsible for 76 percent of the world’s planned 1.4 trillion watts of coal-fired power plants and 90 percent of the projected growth in global coal demand to 2016; that plans (implausibly) to build a coal-fired plant fleet twice as big as America’s; and that will ultimately surpass China in population, though one-fourth of its people still lack electricity?

India’s power generation is still mainly coal-fired, but India’s coal is only abundant, not cheap. Chronic coal-sector and logistics challenges have created growing import dependence (as in China, which became a net importer in 2009). That helped the six countries that control four-fifths of global coal exports to gain the market power to boost prices, so they did. Rising coal imports and a weakening currency gave India a macroeconomic headache and power producers a financial migraine.

Coal prices 2–3 times assumptions imposed a grave price/cost squeeze on two of the world’s biggest coal plants—4-GW projects owned by the largest generating firm (Tata Power, part of Tata Group that’s nearly 5 percent of India’s GDP) and by Reliance. Many plants can’t even get enough coal, exacerbating electricity shortages, but the government doesn’t want to raise electricity prices, so the dominoes are falling. In December 2011, Infrastructure Development Finance Company stopped financing new coal plants. In February 2012, the Reserve Bank of India said it wouldn’t help banks that got in trouble on new coal-plant loans. (See: “Coal Power Loses Its Luster as Costs Rise.”) Financing dried up. Three weeks later, Tata announced its investment emphasis had shifted from coal projects to wind and solar. Led by four of India’s richest families, India shelved plans for 42 GW of coal plants in the last three quarters of 2012. That’s nearly a fourth of existing total capacity, or 68 percent of the government’s short-term target—only 32 percent of which Coal India says it can fuel. With power-hampered growth threatened by even scarcer or costlier power, some of India’s electricity leaders are seeing their way forward in superefficiency, distributed renewables, and microgrids—and not only in rural areas.

As in China, vibrant private-sector entrepreneurship in renewables should be capable of far outpacing the state-owned industries that dominate coal and nuclear power. India, the world’s #3 windpower market, has already installed nearly four times more wind than nuclear capacity. Solar power too added 1 GW in 2012 and is taking off briskly. And of course India has huge efficiency opportunities because most of its ultimate infrastructure isn’t yet built. Projects like Infosys’s 70-percent-less-energy-using new offices in Bangalore—helped by ASHRAE Fellow and RMI Senior Fellow Peter Rumsey—are gaining wide attention. A constellation of impressive new nongovernmental efforts with businesses and governmental allies is starting to focus India’s energy policy reforms and business mobilizations.

In all, India seems to be at an energy tipping point. It is starting to comprehend its massive efficiency and renewable potential, and enjoys growing private-sector skills to capture that potential, especially if regulatory barriers can be removed. All of this as the power sector—chastened by the world-record summer 2012 blackout of 600 million people—starts to face the need for serious reforms. The main missing elements, as in China and Japan, include rewarding utilities for cutting your bill (instead of selling you more energy), and allowing demand-side resources to compete in supply-side bidding.

Of course, there are major challenges in modernizing a sprawling, disjointed sector with irregular management quality and transparency. But with so many brilliant entrepreneurs and engineers, important advances are already emerging from the bottom up at the firm, municipal, and state levels, whether led or followed by national policy. And as we’ll see in the second part of this blog, all three of Asia’s economic giants will be increasingly informed and perhaps inspired by the example of their European counterpart and prime competitor, Germany, which is now switching to a green electricity system faster than anyone thought possible.

This post originally appeared at the RMI Outlet and was republished with permission.

See part one: Japan Awakens and part two: China Scales


[ Outlook for Gas Prices: A Bit Lower This Summer ]

Gasoline prices for U.S. drivers will be about six cents lower on average this summer compared to last year, according to a new forecast. The Energy Information Administration (EIA) predicts that the average retail price for a gallon of regular gasoline will be $3.63, compared to $3.69 last year. That’s only a slight bump up from the current average of $3.60, cited in the EIA’s weekly gas price survey.

“With more fuel-efficient cars and trucks on the highways and expected gasoline prices below last year’s level, Americans will have lower motor fuel expenses this year,” said EIA Administrator Adam Sieminski in prepared comments. The EIA released its summer gas price analysis Tuesday as part of its latest Short Term Energy Outlook. (See related story: “Crude Reality: Gas Prices Rocket Because They Can.”)

The dip in price is “due in large part to slightly lower crude oil prices that account for 65 percent of the pump price,” Sieminski said. Diesel prices are expected to dip by just a penny to $3.94 per gallon.

The West Coast will continue to see the highest prices among regions in the U.S., according to the EIA. Gasoline there is expected to average $3.89 a gallon. The Gulf Coast will enjoy the lowest average: $3.47.

Despite periodic spikes—refinery woes and Hurricane Isaac led prices above  $3.80 last fall—drivers have not seen anything close to the all-time peak of $4.11 reached in July of 2008.


[ Asia’s Accelerating Energy Revolution: China ]

In late 2012, the Rocky Mountain Institute’s cofounder, chairman, and chief scientist Amory Lovins spent seven weeks in Japan, China, India, Indonesia, and Singapore observing Asia’s emerging green energy revolution. In February 2013, he returned to Japan and China. Japan, China, and India—all vulnerable to climate change—turned out to be in different stages of a “shared and massive shift” to a green energy future, one with remarkable similarities to RMI’s Reinventing Fire vision for the United States. See part one: Japan Awakens and part three: India Starts Tipping.

China Scales

China is the world’s #1 energy user and carbon emitter, accounting for 55 percent of world energy-consumption growth during 2000–2011. Yet China now also leads the world in five renewable technologies (wind, photovoltaics, small hydro, solar water heaters, and biogas) and aims to lead in all. Its solar and wind power industries have grown explosively: windpower doubled in each of five successive years. In 2012, China installed more than a third of the world’s new wind capacity and should beat 2015’s official 100 GW windpower target by more than a year. (See related pictures: “Rare Look Inside China’s Energy Machine.”)

China owns most of the world’s photovoltaic manufacturing capacity, which can produce over twice what the world installed in 2012, so the government has boosted its 2020 PV target to 50 GW to soak up the surplus in a few years. Meanwhile, overcapacity drove consolidation, with over 100 makers exiting the world market in 2012. But plunging prices plus Western innovation have made wind and solar into likely power-marketplace winners—even with incentives shrinking to zero.

As non-hydro renewables head for about 11 percent of China’s 2020 electricity generation, vigorous industrial and appliance efficiency efforts are trimming demand growth. To be sure, coal still supplies two-thirds of China’s energy and nearly four-fifths of its electricity, but its star is dimming. Two-thirds of the coal-fired power plants added in 2003–06 were apparently unauthorized by Beijing, but in 2006–10, net additions of coal-fired capacity fell by half, then kept shrinking. In 2011, investment in new coal plants fell by one-fourth to less than half its 2005 level, and China’s top five power companies—squeezed between rising coal prices and government-frozen electricity prices—lost $2.4 billion on coal-fired generation. Coal’s hidden costs, including rail bottlenecks, are becoming manifest; public opposition is rising. And now further speeding the shift from coal to efficiency and renewables is dangerously polluted air (especially in Beijing) as coal-burning mixes with the exhausts of abundant but polluting new cars. (Shanghai’s Singapore-like auction now prices a new-car license plate above a small car to put it on.) Bad air has suddenly created a powerful grassroots environmental movement.

In November 2012, the 18th Party Congress for the first time headlined a “revolution in energy production and use”—strong language from an organization founded in revolution. The incoming leaders had already earmarked major funding to explore how to accelerate China’s transition beyond coal. They clearly intend to fix what President Hu called an “unbalanced, uncoordinated, and unsustainable” development pattern and to get off coal faster. An unprecedented 2012 dip in coal-fired generation, even as the economy grew, was caused largely by a slowdown in manufacturing and strong hydro runoff, but renewables and efficiency too are starting to displace coal. China is making a real bid to be the new Germany, leading not only in making but also in applying its abundant renewable assets.

This post originally appeared at the RMI Outlet and was republished with permission.

See part one: Japan Awakens and part three: India Starts Tipping.

and part three: India Starts Tipping.


[ To Stem Fall in Oil Output, Alaska Seeks to Slash Industry Taxes ]

Facing a decline in oil production that threatens the state’s massive pipeline network, Alaska hopes a $1 billion-a-year tax break will boost the industry.


[ A Movie-Like Ending at Eco-marathon ]

I guess it was important for us to enjoy the ENTIRE Shell Eco-marathon experience. With 10 minutes to go on the very last day of competition, our electric urban concept car fell from first to second place, beaten by a Dixie Cup’s worth of energy.  The story would be gut-wrenching if it had not been for the movie-like ending put together by the winning team from the Purdue University. (See also: “Purdue Solar Racing Seeks to Boost Sun Intensity“)

When our rookie team arrived at the George R. Brown Convention Center in Houston on the first day of the event, we discovered our pit was next to the Purdue Solar Car Team. Their car was beautiful. Amazing even. It looked light, aerodynamic, and efficient. The intimidation factor was over-the-top. Judging from the display materials set up in their pit, the car came from an impressive lineage.  Our students started lowering their championship goals. “Second would be great!” one of the sophomores said as they pushed our car over to the inspection line. (See: “10 Things Learned on the Way to Eco-marathon“)

The second day of the Shell Eco-marathon experience brought a list of successes for the Saint Thomas Academy Experimental Vehicle Team. We passed the technical and safety inspections with our cars, we were invited to participate in a photo shoot for Shell, and we developed a relationship with our new friends from Purdue. The amazing thing about our neighbor from Indiana was that they never stopped working on their car. While we ate, they worked. When we slept, they worked. When we sat out in the sun, they worked. All day and night they worked. Even with the race looming, the team of college students took time to answer our questions and seemed genuinely interested in our projects and my students. (See related Purdue blog post: “Lighter and Sleeker for This Year’s Race“)

Actual competition started on Saturday and our urban concept car jumped out to an early lead. Watching my students work together as a team to prepare the car for each run and then coach the driver during the ten laps of the race made me proud to be part of our program. On each efficiency attempt the driver and his NASCAR-like pit crew squeezed better results from one-person vehicle. As the day drew to a close, the team from Purdue stopped working for the first time. They looked exhausted when they took their carbon fiber marvel over to the inspection area. We went to bed that night in first with a comfortable lead, knowing full well the Purdue team would be ready to go on the last day of competition.

After 10 months of work and many long hours, our team reported for the last day of competition at Shell Eco-marathon. Barring some surprise, it looked like only the untested car from Purdue could unseat us. With two race sessions planned for the day, we were pretty sure our standing atop the leader board was tenuous at best. Early in the morning members of the Purdue team pushed their car to the start line with a look of relief. We cheered for our paddock neighbor. The car went one lap and stopped. Ouch. It was then my students learned an important lesson. They watched the Boilermakers calmly push their car back to the pit and then diagnose and fix the problem. They did it with such professionalism that any potential employers would have offered them a job on the spot. My team of high school students learned what is meant to work hard and keep calm even in the face of adversity.

The last session of competition started under mostly cloudy skies. I won’t lie, with all of the gremlins that plagued the team from West Lafayette, I actually started to think we had a chance to win by default. As Purdue rushed to the start line with less than five minutes left in the last race session on the last race day, the team of young engineers looked anxious. The car left the starting line with all the smoothness that we expected from a well-crafted vehicle and continued like that for all ten of it’s perfectly run laps. I knew we were beat before the result was posted. The real victory for us was how close the final results really were. Purdue had beat us by less than a penny’s worth of electricity!

When the award ceremony was over and the giant checks had all been handed out, the two friendly rivals had a chance to reflect on the excitement of the day. The students from Purdue University could not have been more gracious winners, visiting with our students long after the convention center had emptied out. Congratulations Boilermakers, your team is a class act.



[ Asia’s Accelerating Energy Revolution: Japan ]

In late 2012, the Rocky Mountain Institute’s cofounder, chairman, and chief scientist Amory Lovins spent seven weeks in Japan, China, India, Indonesia, and Singapore observing Asia’s emerging green energy revolution. In February 2013, he returned to Japan and China. Japan, China, and India—all vulnerable to climate change—turned out to be in different stages of a “shared and massive shift” to a green energy future, one with remarkable similarities to RMI’s Reinventing Fire vision for the United States.

See part two: China scales and part three: India Starts Tipping.

Largely unnoticed in the West, Asia’s energy revolution is gathering speed. It’s driven by the same economic and strategic logic that Reinventing Fire showed could profitably shift the United States from fossil-fuel-based and nuclear energy to three-times-more-efficient use and three-fourths renewables by 2050.

Renewable energy now provides one-fifth of the world’s electricity and has added about half of the world’s new generating capacity each year since 2008. Excluding big hydro dams, renewables got $250 billion in private investment in 2011 alone, adding 84 GW, according to Bloomberg New Energy Finance and ren21.net. The results were similar in 2012.

Japan Awakens

After world-leading energy efficiency gains in the 1970s, Japan’s energy kaizen stagnated. Japanese industry remains among the most efficient of 11 major industrial nations, but Japan now ranks tenth among them in industrial cogeneration and commercial building efficiency, eighth in truck efficiency, and ties with the U.S. for next-to-last in car efficiency. With such low efficiencies and very high energy prices—far higher for electricity than in a more competitive market structure, while gas prices are historically linked to oil prices—fixing these inefficiencies can be stunningly profitable. For example, retrofitting semiconductor company Rohm’s Japan head office in front of the Kyoto railway station—even without using superwindows as RMI did in the Empire State Building retrofit—saved even more energy (44 percent) with a faster payback (two years). (See related: “Beyond ‘Green’: The Empire State Building Retrofit“)

As the debate triggered by the Fukushima disaster opens up a profound public energy conversation, Japan is starting to see those tremendous buildings efficiency opportunities—and to realize that it is the richest in renewable energy (wind, solar, and marine in particular) of any major industrial country. Japan has twice the per-hectare high-quality renewable potential of North America, three times that of Europe, and nine times that of Germany. Yet Japan’s renewable share of electricity generation is one-ninth that of Germany—so its renewable power exploitation is exactly the opposite of its relative endowment!

Why such poor renewable generation and modest ambition despite such rich local resources? Answer: because Japan is in a race with Chile to be the last OECD country to establish an independent grid operator bringing supply competition and transparent pricing to the old geographic utility monopolies.

But that is changing; Japan’s once-monolithic business support for utility monopolies-cum-monopsonies (one seller, one buyer) is eroding. Important impetus came in July 2012 from a bold initiative—feed-in tariffs that promote greater renewables integration into the grid—championed by Softbank founder and now solar entrepreneur Masayoshi Son. The tariffs were set at three to four times original European levels, because the government, apparently based on 2005 foreign prices, unaccountably believed renewables cost that much in Japan, where even commodities like PV racks, cables, and junction boxes sell for about twice the world price. Some 5.2 GW of feed-in-tariff applications were approved in 2012, including 3.9 GW of non-residential solar. As prices fall, the Industry Minister is expected to start phasing down the solar feed-in tariff with a 10 percent cut this spring.

Meanwhile, though, the government changed to one more aligned with incumbent monopolists, delaying reforms. And some utilities have been exploiting a loophole that lets them unilaterally reject renewable offerings, without explanation or appeal, as risky to grid stability—so the developer gets no payment and doesn’t build.

As these internal divisions play out, the Land of the Rising Sun is getting eclipsed—making early progress despite persistent obstacles, but falling far short of its potential and others’ progress. Japan added nearly 3 GW of photovoltaics in 2012—but even less-organized Italy installed 7 GW in 2011. Similarly, Japan’s windpower association projects the same market share in 2050 that Spain achieved back in 2010.

But there are hopeful signs too. Son-san’s initiative was supported by at least 34 provincial governors. Hiroshi Mikitani, billionaire founder of the e-commerce giant Rakuten, just left the powerful traditional business forum Keidanren to form a reformist rival group. Slowly, in the subtle and complex Japanese way, business leaders’ center of gravity is shifting toward better buys and more entrepreneurial models. Real projects demonstrating renewables’ competitive advantage will speed that shift.

And if it does take hold, the world has long learned that nothing is as fast as Japanese industry taking over a sector. Nothing, that is, except its Chinese counterpart. (See related: “Why Are China and Japan Sparring Over Eight Tiny, Uninhabited Islands?“)

See part two: China scales and part three: India Starts Tipping.

This post originally appeared at the RMI Outlet and was republished with permission.