WHERE TO SAVE ENERGY

US energy savings: Opportunities and challenges; There is great potential to reduce energy consumption and minimize its total cost by using existing technologies—and without changing the everyday habits of consumers.
Jon Creyts, Hannah Choi Grenade and Kenneth J. Ostrowski, January 2010 (McKinsey Quarterly)

"The specter of more expensive energy, along with concerns about its availability and environmental impact, has renewed interest in finding more efficient ways to use it. For executives, this shift could bring not only new challenges, including stringent regulations, but also new business opportunities. And for society as a whole, the potential savings are huge: more than $1 trillion in the United States alone.

"…[T]here is great potential to reduce [energy] consumption and minimize its total cost by using existing technologies…without changing everyday habits…[but for 4] fundamental barriers…[1] efficiency typically requires large upfront investments…[2] it has low mindshare…[3] opportunities are fragmented across billions of devices in more than 100 million locations…[and, 4] the organizations that would be primarily responsible for implementing energy efficiency find it hard to measure, which makes them less motivated to act…the full range of savings may require a comprehensive energy policy…in three key sectors…"

click to enlarge

"Let’s start with the residential sector, which accounts for 35 percent of the end use potential for energy savings. The incremental investment to make 129 million US homes—and the appliances, devices, and climate control systems in those homes—more energy efficient would be $229 billion, providing present-value savings of $395 billion…[Click thru to “US energy savings: Opportunities and challenges…” for details]…

"…Because several commercial clusters—especially new homes and office devices—resemble their equivalents in the residential sector, we’ll stress the differences. The net present value–positive upgrades would require a $125 billion investment and provide present-value savings of $290 billion. Buildings and the devices used in them offer 87 percent of the opportunity…[Click thru to “US energy savings: Opportunities and challenges…” for details]…

click to enlarge

"The processes, support systems, and buildings of the US industrial sector not only consume more energy than the others combined but also offer the greatest NPV-positive energy-efficiency opportunity (3.65 quadrillion BTUs)—although the smallest (18 percent) as a percentage of end-use consumption. Capturing this opportunity would save $447 billion though present-value investments of $113 billion…[Click thru to “US energy savings: Opportunities and challenges…” for details]…

"McKinsey has looked long and hard for ways to obtain an affordable, secure energy supply while controlling climate change. Energy efficiency stands out as the single most attractive and affordable component of the necessary shift in energy consumption…Although significant challenges stand in the way, solutions not only exist but can also be scaled up to a national level, which would cut the US energy bill by 23 percent and save a net $680 billion by 2020. But that isn’t very far in the future, and each wasted day makes this—or any goal whatsoever—more difficult to reach."