It has been a while since I have had a chance to write a blog because I have been very busy working with our JV partner EESL as well as on other projects.  In November I made my first ever visit to India to speak at the INSPIRE event, so it seemed appropriate to write about energy efficiency in India.

First of all when you look at India you have to get used to the big numbers, starting with 1.3 billion people, installed electrical capacity of 331 GW, and economic growth rates of 7 to 8%.  When you project current trends forward you quickly realise that energy efficiency in India is a matter that should concern the whole world.  If India gets it right the world has some chance of meeting climate related targets.  A clear example of this is air conditioning which is vital in most parts of India, and is a market set to grow dramatically.  At the moment the market penetration of room air conditioners (RACs) is only 4-5%, roughly where it was in China in 1995 (compared to a c.53% market penetration in China today).  The projected growth of RAC in India as incomes increase could result in additional peak loads of 143 GW (about twice the total UK installed capacity!), requiring 300 additional 500 MW power stations.  Work is currently under way on a national cooling strategy which aims to mitigate the growth in power demand from cooling and will include measures such as enhanced efficiency regulations on RACs, driving innovation in cooling, promotion of passive cooling, and district cooling using trigeneration.

Energy Efficiency Services Ltd (EESL) is a central player in the Indian energy efficiency market.  EESL was established in 2009 by the Ministry of Power as a JV of four utilities, the National Thermal Power Corporation (NTPC), Rural Electrification Corporation (REC), Power Finance Corporation (PFC) and Power Grid Corporation (PGICL).  The vision behind EESL is to unlock the $11 billion market for energy efficiency, amounting to 15% of present consumption.  EESL works closely with the Bureau of Energy Efficiency and leads the market related activities of the National Mission for Enhanced Energy Efficiency.  From 2009 to 2013 little progress was made and then there was a change of leadership that led to amazing results, including growing revenues 46 times.

EESL is best known for its LED programme, UJALA, which has distributed more than 270 million LEDs across India.  EESL’s model of aggregating demand and large scale procurement has driven the price of LEDs down by a factor of ten.  Critically the UJALA programme does not rely on any subsidies, it is a commercial model in which consumers and utilities pay as they save.  The savings have been around $338 million.  Another effect of the growth of the LED market has been a surge in domestic manufacturing.  LED production in India has grown from 5 million units in 2013 to 600 million units in 2017, creating 185,000 jobs in 2016/17.  The UJALA programme aims to replace 770 million LEDs by 2019.

A similar aggregation approach has been applied by EESL to replacing street lighting. As well as using LEDs EESL has implemented a Centralised Control and Monitoring System (CCMS) for street lighting that provides remote monitoring 24×7.  Globally we have started to recognise the importance of non-energy strategic benefits of energy efficiency and EESL has taken steps to measure these through social audits which show that citizens are a lot more satisfied with the LED lighting and feel an enhanced sense of safety and security.

EESL has also moved into several other key areas including agricultural pumps, domestic appliances, smart meters and electric vehicles (EVs). Towards the end of 2017 EESL procured 10,000 EVs to lease to government departments (which have a huge fleet of cars for the use of officials).  The procurement brought the price of the EVs down by 25%. EESL will lease the EVs and charging infrastructure to departments for less than they currently pay for petrol driven cars. A further procurement of EVs will follow.

As the world’s largest publicly owned super-ESCO EESL has been remarkably successful.  It has been highlighted by the International Energy Agency and the World Bank as a model for deploying energy efficiency at scale and it is certainly a model that all countries can learn from, North as well as South.  At EnergyPro we are proud to be working with EESL to combine both sets of experience to build a portfolio of projects in Europe and beyond.

The data in this blog has mainly been taken from the EESL coffee table book: “UJALA. I LED the way.”  With thanks to EESL and AEEE for the opportunity to present at the INSPIRE event in Jaipur. 

For further information regarding INSPIRE 2017: INSPIRE 2017 papers can be found here and the INSPIRE 2017 Report can be found here.

At the recent Green Bonds conference at which I chaired a panel, Sean Kidney of the Climate Bonds Initiative challenged the audience in his inimitable way with the questions – “how do we scale-up all this (meaning investment into green infrastructure) rapidly?”

It won’t be a surprise but my response starts with the absolute need to focus on the massive economic potential offered by energy efficiency.  Improving energy efficiency will bring cheaper, cleaner, faster reductions in emissions, and greater economic impact than investing in generation options – and it has been proven many times there is massive potential that is economic right now.

It also won’t surprise anyone when I say scaling-up requires standardization in the way that projects are developed and documented and for energy efficiency this means through systems such as the Investor Confidence Project (ICP).  Failure to require standards like ICP will lead to a lot of under-performance, both financially and environmentally.  If green bond investors only rely on ex ante assessments of energy saving, or rely on inaccurate indicators like Energy Performance Certificates, and don’t require standardized projects with independent Quality Assurance and enforced Measurement and Verification of results we may end up with a gross misallocation of investment into “green” energy saving projects that really are not performing, financially or environmentally.

The really big problem is that there is not a culture or eco-system for developing large, multi-premise investment programmes.  Project developers and owners tend to work on one project at a time, developers like ESCOs are passive and only respond to RFQs, they don’t go out there and create demand at a portfolio level. We need a new type of developer – let’s call them a “super developer”, that only develops large scale projects, aggregating smaller projects and acts like an infrastructure or property developer. Developing anything is high risk and there is a need for risk equity capital to drive the development of project investment opportunities at scale. Super developers could be private sector or public sector. Governments have huge portfolios of property and vehicles and should provide a ready channel to aggregate demand through super developers but they are not really doing it.

To learn how to scale-up investment into energy efficiency we need to look around the world to places where efficiency investment is actually happening at scale and I see four case studies of super developers in action that have global significance and everyone needs to examine:

• PACE in the US which was discussed earlier in the conference
• The Carbon & Energy Fund (CEF) that is a framework for procuring Energy Performance Contracts in the UK’s National Health Service (NHS)
• The Dubai Super ESCo
• Energy Efficiency Services Ltd (EESL) in India.

At the green bond conference we heard from David Gabrielson of PACE Nation and Craig Brown of Renovate America about how PACE has really started to scale in the US.  In Europe the good news is that the EuroPACE Project has been awarded €2.4 million of Horizon 2020 funding to introduce PACE type models to Europe. I am pleased that we at EnergyPro Ltd are advisers to that important project.  In the PACE eco-system there are large players like Renovate America and Renew Financial who aggregate demand, ensure contractors meet appropriate standards and access large pools of capital through bond issues.

The Carbon & Energy Fund, which is not actually a fund but rather a procurement framework, engages with NHS hospitals to develop and deliver EPCs.  Hospitals join the framework and commit to implement an EPC which CEF develops in conjunction with an ESCO selected by a competitive process between the ESCOs on the CEF framework.  CEF sources finance and charges a fee based on capital expenditure and an on-going fee for contract management and measurement and verification.  CEF has developed about 40 EPCs.

The Dubai Super ESCo – the Etihad Energy Services Company is doing great work in the UAE and it only works with portfolios of buildings.  I wrote about it here and since then they have announced new deals including; retrofitting controls and installing PV in 243 buildings owned by a leading property company, and 650 facilities, (mosques, offices and residences), under the jurisdiction of the Islamic Affairs and Charitable Activities Department (IACAD).

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EESL in India has done and is continuing to do amazing things, operating a commercial model that has aggregation of demand at its heart. They have deployed 270 million LEDS and through aggregation of demand reduced the price of an LED by a factor of ten. The approach is now being applied to other technologies like high efficiency motors, pumps and fans and smart meters. EESL also recently procured 10,000 EVs for government departments in the largest ever procurement for EVs and reduced the price of EVs significantly.  The 10,000 EVs are seen as a pilot and next year EV procurement will be ramped up many fold.

Whatever the choice of structure, whether it is a framework, a super-ESCO, a corporate aggregating demand and accessing finance, or some other form we haven’t seen yet, it is clear that we need more super developers.

The most recent EEFIG meeting focused on industry, a sector that is sometimes neglected compared to buildings.  I summarised the work on the EEFIG Underwriting Toolkit and took the opportunity to give a few remarks on how to increase the flow of investment into energy efficiency in industry.

When talking about energy efficiency investment we often assume we are talking about third party, external investment from banks or funds but the reality is that most efficiency investment is internally funded.  The EEVS survey in the UK shows that over 5 years only 5% of projects were financed by third party finance. The IEA energy efficiency report shows that global energy efficiency investment in 2016 grew 16% to $231 billion but in the business sector only 25% of that was provided by debt, and the ESCO market is only 12% of the total investment.  The reality is that most of the time the investor is the CFO, in fact even if projects are externally financed the CFO will always be a key decision maker.  CFOs have exactly the same issues around energy efficiency that external investors have, namely:

• lack of expertise;
• lack of certainty around the results.

Given the importance of CFOs and the fact that that have the same issues as third party investors the EEFIG Underwriting Toolkit should be useful for them.  EEFIG should consider how best to distribute it to the CFO community, possibly through accounting institutes such as the Institute of Chartered Accountants in England & Wales and similar organisations in member states, and not forgetting CFOs in the public sector who often have their own institutes and networks.

Although people often criticise the fact that industry typically insists on a two year payback period for energy efficiency the reality is that it can be entirely rational to do this given:

• uncertainty in outcomes;
• uncertainty about future demand / production levels / product types / markets or even production locations;
• the existence of more strategic investments such as new production plant, new products or marketing.

The excellent work of Catherine Cooremans highlighted that energy efficiency is not usually strategic.  In any organisation things that are considered strategic are much more likely to be invested in and usually have longer payback periods.

In recent years we have recognised that energy efficiency brings many other benefits than just energy and energy cost savings.  These benefits can include increased asset value, increased productivity, increased health and welfare and many others.  These types of benefits are often much more strategic and interesting to decision makers than just energy cost savings.  These benefits have long been neglected in building business cases because the energy efficiency industry focuses just on energy savings – invest x and save y. We have standardised and mandated energy audits but they of course just focus on energy, the standards were developed by energy efficiency experts.  We need to work to improve the quality of business cases and ensure they include all the benefits. We now have standardisation in the technical aspects of energy efficiency projects, in the form of the Investor Confidence Project and its Investor Ready Energy Efficiency™ project certification system, and an approach to value and risk appraisal in the form of the EEFIG Underwriting Toolkit.  The next piece of the jigsaw is a common approach to building better business cases from beginning to end, that means from idea generation right through to commissioning and Measurement & Verification plans.

Another aspect in industry is the fact that the idea of outsourced energy services has not generally been accepted in industry whereas outsourcing IT or vehicle fleets is accepted.  Where it is present it is usually confined to ancillary services like boilers and compressed air systems.  We need to encourage knowledge about the benefits to outsourcing energy services and the know-how to implement such projects.

The reality for most industrial companies is that if they have a need for external finance they are most likely to approach their own relationship bank rather than a separate entity such as a specialised energy efficiency fund.  We need to work to ensure that the banks that service the industrial sector see the benefits for them which are risk reduction and a new business opportunity.

Finally when we talk about energy efficiency investments we tend to focus on retrofit projects but every day hundreds or even thousands of investment decisions on new production lines, expansion, new production facilities are taken. These are what I call “normal” investments.  New plant will inherently be more efficient than older technologies and facilities they replace because of tightened regulations and improved technology.  We know however that for many reasons, lack of know-how, time pressure etc., many cost-effective investment opportunities to maximize energy efficiency are missed.  To address this we definitely need to build capacity in end-users and consultants around high efficiency design techniques such as integrated design.  Proper use of integrated design has been shown by Rocky Mountain Institute and the excellent Sustainable Energy Agency’s Energy Efficiency Design programme to significantly reduce energy costs and capex as well.  We also need to help banks ask the right questions by adopting processes like EBRDs, and like ING have implemented for real estate, in which customers asking for finance for new facilities are asked about energy efficiency levels.  If banks are to contribute to climate goals they should only be funding improvements and new facilities that move beyond “Business As Usual” improvements.

To summarise; to increase the flow of investment into energy efficiency we need to:

• build capacity within CFOs as well as banks to help them better understand and evaluate the value and risks of energy efficiency projects;
  • to do this governments and the EU can promote the use of the EEFIG Underwriting Toolkit within financial institutions and corporate board rooms.
• build the case for outsourced energy services to make them as common as outsourced IT or vehicle fleets;
  • trade associations and providers need to build and promote the case for energy outsourcing. Governments and the EU can help in this.
• work to improve the building of better business cases through guides and training emphasising strategic non-energy benefits;
  • the EU could support the development of a guide to building better business cases. This will build upon the work that the EU has already supported to roll out the Investor Confidence Project and the EEFIG Underwriting Toolkit.
• drive the standardisation of the development and documentation of energy efficiency projects through best practices and certification programmes such as the Investor Confidence Project’s Investor Ready Energy Efficiency™;
  • development banks and other funders, including providers of grant funding for energy efficiency such as the EU and member state governments, should insist upon using best practices and certification programmes.
• demand that all projects have Measurement and Verification (M&V) and that real performance data is collected and analysed – over time this will create the data for proper risk assessment;
  • again, all development banks and grant funding should insist on M&V. We can no longer implement projects that don’t generate performance data;
  • even now many projects are being funded without insisting on M&V, even projects that are supported by the EIB and by European grant funds. This is no longer acceptable.
• improve capacity around integrated, high efficiency demand, both amongst customers and consultants as well as the financial community;
  • using “off the shelf”, BAU designs for new facilities and buildings should no longer be acceptable.
• equip mainstream financial institutions to ask the right questions around requests to fund new facilities in order to maximise the uptake of cost-effective energy efficiency opportunities that are often missed today.

ESTA invited me to make a keynote address at their UMR Conference in Birmingham on 10^th October 2017.  Thanks to ESTA and the attendees for the opportunity and the questions.  As usual this written version represents a tidied up and more coherent version of what I actually said on the day. 

First of all I am always pleased to be back in Birmingham because it is where I took my undergraduate degree and first studied energy matters.  Secondly I am pleased to be in Birmingham as last week I was supposed to be presenting in Barcelona but I don’t like going into cities with civil unrest, fortunately Birmingham is not quite ready to declare independence but given the crazy world we live in now let’s give it a few years and see what happens.

I was given this title and my first reaction was that it was very different to what I normally talk about – the Investor Confidence Project, energy efficiency financing and making efficiency more investable.  And then I realised that those topics are very much related to addressing the issues of energy security, energy efficiency and fairer bills and I should use the opportunity as if I was giving advice to government.  I should start out by saying – with apologies to any government representatives in the room – I often find giving advice to governments, and I am not just singling out the UK here, a case of banging your head against a brick wall, I can only do it for so long and then I have to stop for a while.

I know we live in a “post-factual” world but let’s start by looking at some facts, many of which are still shocking and which demand a strong response.  These are facts that will impact on the global, European and UK energy situation over the coming years and decades, facts that need to be considered when formulating policy.

• The EU spends more than €1 billion a day importing energy. It was up to €500 billion a year but the fall in oil prices has helped a bit.
• Fossil fuels are still dominant globally. Despite rapid gains for renewables, fossil fuels still account for 80% of global primary energy use.
• The US spends about $280 billion a year on US Navy power in the Gulf region, essentially protecting the flow of oil. That works out at about $83 a barrel and yet only 20% of the total flow goes to the US, a percentage that is declining as the US becomes more self-sufficient. In a world with an isolationist US government (if it is isolationist today according to the latest tweets), you have to question how long that may continue.
• In 2016 the Kingdom of Saudi Arabia, a country I have been fortunate enough to get to know over the last few years, produced c. 10.5 million barrels of oil a day and exported c.7.6 million barrels a day. Some projections show that by 2035 domestic demand in Saudi Arabia could equal production.  Needless to say if this ever happened it would have very significant effects on the oil market and Saudi Arabia. This is undoubtedly being taken very seriously within the Kingdom.
• Russia supplies 34% of gas used in the EU, a situation that the EU expects to continue for “at least 2 more decades”. That is a major geo-political strategic risk.
• When we look globally we see huge economic growth, particularly in China, India and S.E. Asia with projections that there will be an additional 3 billion middle class by 2030. That will be a huge achievement and very welcome, but we know that when people become middle class their demand for energy kicks up dramatically as they start to buy all the energy using devices we take for granted.
• There are an estimated 2 million premature deaths a year globally, a result of burning fossil fuels. In the EU the number is estimated at 300,000 and in the UK 50,000.  This problem is not being addressed effectively, I think all parts of London now exceed “safe” limits on particulates so we have gone backwards, mainly because of the promotion of diesel cars.
• Globally 1.3 billion people are without electricity. There are great strides being made on this, again India stands out as a good example.  We need to get everyone using electricity, the benefits in education and health are huge.
• On the issue of climate change, the IEA and IRENA estimate that to achieve their “66%, 2°C” scenario the investment into energy efficiency has to be increased to an average of > $1 trillion a year, a five-fold increase on current levels.

Jumping back to the UK:

• the UK imports just under 40% of its energy supplies and at the peak in 2012 the financial cost was £24 billion – more than £460 million a week. Perhaps we should put that on the side of a bus.  Although things are now moving in a better direction this is still very concerning.
• We know the UK electricity system is facing “unprecedented challenges” in terms of supply margin.
• We have Hinkley Point C which is an unproven technology which is already late – no surprise there. Also apparently we need the Chinese to finance reactors. I was bemused to read a report this morning that government officials testified to a committee that the decision to build it was “the best value option”.
• We still have not resolved fuel poverty after years of talking about it. We have 4 million people including 1.5 million children living in fuel poverty which costs the NHS £850 million per year.
• We know that there is a massive, cost-effective energy efficiency potential, equivalent to 22 power stations according to the government. However, despite many successes, we still only scratch the surface of the economic potential.  We all know of projects that don’t proceed despite great paybacks, paybacks that we would all be happy with in our own investments.
• On the positive side, solar is rapidly becoming economic without subsidy, not just in the UK but globally.
• We are also seeing great reductions in the price of storage, particularly batteries, that will dramatically change the energy scene. Projects like the famous Tesla giga-factory are starting to have an impact.
• In transport EVs are making an impact much faster than many, including myself, would have predicted. Next month will see the launch of Tesla’s electric “semi” truck and electrification can offer rapid paybacks in selected freight transport segments. I recently heard of a company working on marine electrification for ferries. That is a great application I would never have thought of, there is a predictable duty cycle and there are less space constraints and technical issues than in cars.
• As well as the falling price of solar and batteries we are seeing a fall in the price of energy efficiency. The most obvious example, but not the only one, is the price of LEDs.  This slide was shown by the Indian Prime Minister last week and it highlights the work of Energy Efficiency Service Ltd (EESL) who have aggregated demand and bought the cost of an LED lamp in India down from c.$7 to c.70 cents in a very short time by aggregating demand.  EESL is now applying that experience to other technologies and other countries including the UK, and I am proud to say that my company EnergyPro is their JV partner here.
• All of this change has had a massive effect on traditional utilities. There have been massive financial losses – €0.5 trillion (yes trillion) according to the Economist in 2013 (and more since then) – and big restructurings.  All utilities are looking for new business models, if they are not then they are finished.
• The effect of solar on the grid is the same everywhere. The arrival of what the Americans call “the duck curve” is being felt in all electricity systems where solar is being deployed i.e. all systems.  The duck curve is a rapid reduction in net load during the day as solar output climbs coupled with a steepening of the load curve in the evening as solar output falls away, a steepening that is increasingly hard to match with conventional generation technology.

Given these facts (and many others we could talk about) we need to take a new perspective on energy and energy efficiency.  If we don’t we will continue to bang our collective heads against the same brick wall over and over again, and energy efficiency will continue to under-perform.

So, what is the “traditional” view of energy efficiency? I would summarise it as follows:

• efficiency is something that is tacked onto the end of energy policy. Politicians talk about energy, finish by saying “don’t forget about energy efficiency” and then promptly forget about it.
• it is “good for you” in the same way that cold showers are good for you.
• it has uncertain outcomes – one of the reasons people don’t invest in so-called “low hanging fruit” is that they are not convinced they will get the promised results.
• it needs to be encouraged by mandates or subsidies.
• it is hard to invest in.
• it is somehow different to other markets – there are “market failures”.
• it is often a “calling”, a “campaign” or a “crusade”.
• for most people, most of the time, it is really, really boring.

The new and emerging view of energy efficiency is one in which:

• it is central to energy policy.
• it is a Distributed Energy Resource (DERs) like other DERs such as local generation & demand response.
• it can be reliably dispatched with quantified and known risks.
• it can be aggregated.
• it can be contracted for using standard contracts that look like Power Purchase Agreements.
• it can easily be invested in.
• it can be priced per kWh like any other energy resource.

So how do we actually make this view mainstream?  We have to create a true market for energy efficiency.  At the moment we talk a lot about “the market for energy efficiency” but there is no market for energy efficiency, there are only markets for stuff such as LEDs, boilers, controls, heat recovery etc.  You can pick up the phone or go on-line and buy energy, but you can’t buy energy efficiency, only stuff and stuff with uncertain outcomes.

To make a market, any market, we need several things; a system of weights and measures, standardization of product, and standard contracts with penalties for non-delivery.  If you look at any market, whether it be apples, or sophisticated financial derivatives, these factors are present.  The good news is we now have the technologies to make a true market for energy efficiency.

This is now starting to happen in California and spreading to other US states. In California it was driven by new legislation that increased renewable and energy efficiency targets and required a switch from deemed savings to metered savings, combined with pay for performance models.   Once you make that change it enables a number of things including:

• contractors can pick their business model and technology. If a contractor can save energy through awareness campaigns then they can be rewarded just as if they had invested in LEDs.
• contractors have to perform, or they go out of business.
• a programme administrator or a procurer of energy efficiency can compare the performance of different contractors.
• multiple small projects can be aggregated and demand capacity sold into the grid.
• the grid operators can enforce the same kind of non-performance penalties on energy efficiency they can on energy supply options.
• a market can be established by utilities setting a resource curve and procuring efficiency in the same way they procure energy supply, with metering, a high degree of certainty in the outcome and penalties for non-performance.
• reverse auctions can be held that set the price for the various energy efficiency resources. For those that are not economic, e.g. fuel poverty programmes or encouraging deep retrofits, governments can add a payment on a price per kWh basis to drive the real outcome they want.
• energy efficiency projects can be financed through project cash flows rather than on the balance sheets of project sponsors, therefore becoming just like every energy generation project.

So if government, any government, should ever ask my advice in future this is what I would say:

• avoid chasing the latest shiny bright thing (this months being Small Modular Reactors).
• treat energy efficiency as a resource like any other.
• support the establishment of energy efficiency weights and measures.
• require that energy efficiency is metered not
• support Pay for Performance models – don’t pay for stuff, pay for results.
• add programme support for situations that are not economic but desirable g. fuel poverty & NZEBs but pay for performance and not stuff.
• encourage innovation only by paying for performance – don’t worry about the technology – only the performance.

I was honoured to be presented with an ACEEE Champion of Energy Efficiency Award in Denver, Colorado on 17th August.  Here are my remarks on accepting the Award at the ACEEE Industry Event.

Thank you very much for this award.  It is a great honour to be given an award by the ACEEE as most of my work is outside the US and I am a big fan of the work of ACEEE. When I flew over for this I wasn’t expecting to have to make an acceptance speech so I was very surprised when I read in the programme “presentations by award winners”. When I asked Ethan for advice, he suggested talking about how I got into energy efficiency and something about the industry.

Well, it may not surprise you that when I was asked, “what do you want to be when you grow up?” as a child I did not say, I want to go into energy efficiency. I actually wanted to be an astronaut but growing up in UK in the 1970s that didn’t seem a viable career move. Then in 1974 in the U.K. we had something called the three day week. This meant that industry only got electricity three days a week, TV finished early, households had rolling power cuts, and even the pubs closed early. This was all due to a strike by coal miners, but it came on the back of the first oil crisis and the two combined seemed to foretell some dystopian future where energy was in short supply. I decided then that energy was a really important area to work on and particularly energy efficiency and renewable energy, which back then was called alternative energy. When I left school I took one of the first ever degrees focused on energy. Then after working a year as an energy auditor I was invited to do a PhD about the potential for energy efficiency in British industry. I have to tell you I had no intention of doing a PhD, but this was a unique opportunity as it was based in industry. Furthermore one of the industries I focused on was brewing. So I spent much of my PhD in breweries and in those days workers in breweries could drink at lunch time – something long gone because of Health and Safety rules. So all in all it was a hard PhD to turn down. It is worth noting that brewing has always been central to energy efficiency and thermodynamics – John Prescott Joule who did the early work on thermodynamics was the son of a wealthy brewer and his early work was all about saving money on energy costs – only later did he work on the theory.

So that is how I got into energy efficiency. I suppose the other question is why did I stay with it so long. There is a lot of talk of barriers in energy efficiency and I suppose I have banged my head against every one of them over the years. I was probably too pig headed or too stupid to stop banging my head against barriers. There is also a more subtle and important explanation and that is about purpose. I think that improving energy and resource efficiency or productivity is the key challenge of our times and a worthy purpose to pursue. We know that we need to generate much more wealth, that is the only way to resolve problems of poverty and ignorance, here in the US, in Europe and in every corner of the world. Fundamentally we have to make everyone rich. In the past of course, and the not too distant past when I was a student, the prevailing truth was that increasing GDP meant increasing energy usage. Since the industrial revolution, wealth creation has been based on extracting more and more resources with all of the negative impacts that brings. It is clear now that despite the views of some people in Washington that model is bankrupt. Incidentally I read yesterday that in Washington the administration is following a BAY policy – Business As Yesterday.  Despite the views of the current administration it is clear that the next mega-wave of wealth creation is about increasing the efficiency of energy and resource use – decoupling GDP growth and energy and resource use – something we have started to see in energy use in Europe and the USA. Energy efficiency is clearly at the heart of that change.

What keeps energy efficiency interesting as a career is seeing how far can we go? When you have worked on the problem as long as I have you get a historical perspective. In 1976 Amory Lovins published “Energy strategy: the road not taken” in which he described “soft energy paths” and in the UK in 1979 Gerald Leach published “A low energy strategy for the UK”.  Both of these were considered wildly optimistic at the time and widely panned by analysts, the energy industry and government agencies.  History shows that they turned out to be more accurate than any official government or energy industry scenario.  As I said in the title of a blog; “Surprise, you are living in a low energy future”.  What is more, we achieved that low energy future without really trying, except perhaps for a ten year period starting in the mid-to late 1970s.

Being an optimist I think that the six powerful drivers of change; policy, economics, technology, the interest of institutional capital, new business models and market infrastructure will continue to drive advancements in energy efficiency, and over the next 30 to 40 years we will achieve a much more efficient future than we think possible.  At the end of the day our level of energy efficiency is simply a matter of choice.  Given all the global and local pressures choosing anything other than a very low energy future makes no sense.  In fact when we consider the global environment a famous phrase from the space programme comes to mind, “failure is not an option”.

I want to finish with one more space related quote. When Apollo 11 was coming back from the moon the crew held a final in-flight press conference where they talked about the meaning of the moon landing.  Michael Collins the Command Module Pilot, likened Apollo 11 to a submarine’s periscope – all you could see was the capsule and the crew but underneath that was a huge support structure that made it all possible.  I often think that our careers are like that – all you see is the individual’s achievements but in fact they are supported by many, many people, some remembered, some forgotten – family, friends, teachers, mentors, bosses, team members, clients and many, many more.  I would like to thank all those people who have contributed to my career, past, present and future.

Thank you again to the ACEEE for their great work and thank you very much for this award.

17^th August 2017