It may be surprising to some but Saudi Arabia has a vigorous programme to promote energy efficiency. The rationale for this is an analysis that shows the rapidly increasing Saudi population, and rising wealth coupled with very low energy prices means that Saudi electricity demand is growing at 7% per annum and domestic use of oil is growing at 5% per annum. In 2012 domestic oil use reached 35% of production and in 2011 Chatham House estimated that by c.2035 domestic oil consumption could equal production1. Clearly if that scenario ever happens the Saudi economy, and no doubt political structure, would be under severe pressure and there would be a major impact on the global oil market.
 
With this in mind, in 2003 Saudi Arabia launched a national effort (the National Energy Efficiency Program, NEEP) to enhance demand side efficiency. Between 2007 and 2010 there was an initiative by the Ministry of Petroleum to transfer the NEEP to a permanent entity and in October 2010 the Saudi Energy Efficiency Center (SEEC) was formed. The mission of SEEC is to “reduce energy consumption and improve energy efficiency to achieve the lowest possible energy intensity”.
 
It’s key tasks are to:

• develop an EE plan covering policies, regulations and initiatives
• monitor the implementation of the plan
• promote EE awareness and support building capacity
• promote the EE industry.

In 2012, SEEC in conjunction with ministries, regulatory authorities and major companies launched the Saudi Energy Efficiency Program (SEEP). SEEP is purely focused on demand side management and its remit does not include the issue of price reforms. The subject of energy prices, which are heavily subsidized to consumers, is highly sensitive in the Middle East. In 2012 there was civil unrest when the Jordanian government changed the subsidy regime on fuel and there is no doubt that all Middle Eastern governments are very conscious of the social impacts of changing energy subsidies – especially at this time of instability in the region.
 
The SEEP is focused on three sectors; industry, buildings and transport.
 
Industry represents 42% of total energy use with 80% of the energy going into the petrochemical, cement and steel industries. Feedstock is not part of SEEP as it is handled by the Ministry of Petroleum and Mineral Resources. In the cement industry over 600 cement plants were benchmarked with the World Business Council for Sustainable Development (WBCSD), all plants were visited to share the methodology, targets were set for existing plants, a defined maximum energy intensity was set for the design of new plants, and the new roles and responsibilities were developed. In addition SEEC is looking to enhance its mandate to include the collection of data, the setting of targets and their enforcement. Another major energy user in Saudi Arabia of course is desalination of water and there are programmes to improve the efficiency of desalination.
 
Buildings account for 23% of Saudi’s energy use with not surprisingly 70% being used for cooling. The aim is to catch up with the rest of the world in terms of standards and codes. In Buildings the key energy efficiency initiatives have included:

• updating the efficiency standards for small capacity air conditioners to ASHRAE standards
• developing an efficiency standard for large air conditioners
• updating thermal insulation product standards
• finalizing efficiency standards for residential lighting products
• developing efficiency standards for commercial and street lighting products
• updating efficiency standards for refrigerators and washing machines
• updating the Saudi Building Code energy conservation section (SBC 601) to ASHRAE standards
• developing a process to ensure proper enforcement of SBC601.

Transport accounts for 23% of total energy use. There are 0.7m Light Duty Vehicles (LDVs) entering the market every year and the stock of LDVs is forecast to reach 20 million by 2030. Incoming LDVs have low average fuel economy given the nature of the fleet mix. In transport SEEC, working with its partners, has developed fuel economy standards in line with international benchmarks. Specific measures include:

• developing a Saudi specific fuel economy standard for LDVS (to catch up with US CAFE standards over time)
• adopting a fuel economy label design similar to EU’s to be enforced on LDVs from model year 2015
• developed a tyre rolling resistance and wet grip standard for LDVs
• identifying key initiatives for Heavy Duty Vehicles (HDVs) (anti-idling regulations, aerodynamic additives, light weighting and mandatory retirement of old HDVs.

Energy intensity in Saudi Arabia intensity has grown significantly over the last 25 years, particularly since 1985, reflecting the growth of the economy, its level of economic development and reliance on heavy industry. Energy intensity was twice the world average in 2010 and energy use is still growing faster then the economy. The overall objective of SEEC is to reduce the electricity intensity by 30% between 2005 and 2030 and half the peak demand growth rate by 2015 compared to the period 2000-2005.
 
As well as energy efficiency Saudi Arabia is of course also pursuing renewable energy and nuclear power. It has a target of attracting investment of $109 billion in renewables and building 54 GW of renewables by 2032 (producing half of all electricity demand), as well as 18 GW of nuclear. So far, however, the largest ground mounted PV plant, at the King Abdullah Petroleum Studies Center (KAPSARC) is only 5 MW. Keeping PV panels clean is a major issue in the harsh, dusty climate.
 
Clearly there is a long way to go but it is encouraging that Saudi Arabia is working to improve energy efficiency. As in many other issues Saudi Arabia faces particular constraints that are rooted in unique social and historical factors – balancing these factors and modernization is a massive challenge. Given the importance of Saudi in the oil market globally and the region generally we should support the national energy efficiency programme’s success. The fact that there is a vigorous Saudi’s programme just adds to the view that the potential resource of energy efficiency is now widely recognized everywhere, but in Saudi as everywhere else we now need to improve the utilization of that resource and work to make investing in efficiency as mainstream as investing in oil, gas and renewables.

On a recent visit to Singapore where I spoke at the International Green Building conference on “Innovations in energy efficiency financing”, I learnt more about Singapore’s commendable policies to promote green buildings. The island state of Singapore, which will mark the 50th anniversary of independence next year, has made sustainable development a national priority and has made impressive progress in many areas. It has a vision of becoming “a global leader in green buildings with special expertise in the tropics and sub-tropics, enabling sustainable development and quality living”. The Building Construction Authority (BCA), my hosts for the trip, launched their green building standard Green Mark in 2005. Comprehensive measures to promote green buildings were included in the 1st and 2nd Green Building Master Plans and the 3rd Green Building Master Plan builds upon these earlier programmes and includes initiatives such as; a Green Buildings Innovation Cluster, an incentive scheme to encourage more owners to adopt Green Mark, mandatory periodic energy audits and mandatory energy reporting. There will also be more of an emphasis on behavioural change for tenants and occupants.

There are now more than 2,100 property developments that meet one of the Green Mark standards, which like LEED has different levels of certification – Certified, Gold, Gold Plus, Platinum. A Platinum building can achieve 30% better energy efficiency than a code-compliant building. The total gross floor area of Green Mark buildings is now 65 million square meters, which equates to 25% of the total built up area and the national target is to have 80% of all buildings qualified as Green Mark by 2030.

At the conference the BCA launched the inaugural Green Building Benchmarking report. The report covered more than 800 buildings covering offices, hotels, retail buildings and mixed developments. From 2008 to 2013 the total electricity use of commercial buildings increased by 14% but gross floor area went up by 20%. The Energy Utilization Index (EUI – measured in kWh/m2 year) of these buildings had increased by 5%. For each category of buildings in the benchmarking report a top 10 list was produced and the report highlighted some interesting results from 54 buildings that had been retrofitted. On average chiller plant efficiency had been increased by 38%, from 1.05 kW/RT to 0.65 kW/RT. The average total building electricity of retrofitted buildings was reduced by 16%, equivalent to S$30 million each year. In a separate study the BCA looked at the value of 40 retrofitted buildings and concluded that for retail buildings Operating Expenses of retrofitted buildings were reduced by 13.5% and capital value increased by 2.7% while for office buildings Operating Expenses were reduced by 11.6% and capital value increased by 2.3%. This is important evidence to support the business case for green retrofitting.

The conference was also an opportunity to stay in the Marina Bay Sands hotel. Marina Bay Sands is the largest single Green Mark certified building in Singapore and its green credentials include; regenerative drives on the lifts, LED lighting and intelligent lighting controls, water saving features, District Cooling and green roofs. Its most famous feature, however, is the amazing 150 m long infinity pool, on the 200 metre high cantilever platform which spans the three towers. I was pleased to experience the infinity pool even if going to the side was “interesting” given that I now seem to dislike being near the edge in high buildings. Being in the Marina Bay Sands hotel, the associated shopping mall and conference centre, really is like being in a science fiction movie – sort of like being in a benign “Blade Runner” or an arcology. The arcology concept – a large self-contained building that contains living, working and agricultural facilities and is sustainable – was pioneered by architect Paolo Soleri and although it never gained much traction it seems to have been almost implemented in buildings like the Marina Bay Sands. A great science fiction book involving an arcology, which I thought of often while in the Marina Bay Sands, is “Oath of Fealty” by Larry Niven and Jerry Pournelle. Written in 1981 it describes the technologies of an arcology but also examines some of the social issues we now live with every day such as the pros and cons of continuous CCTV surveillance: http://www.amazon.co.uk/Oath-Fealty-Larry-Niven/dp/1416555161.

Back in the real world Singapore recognizes the barriers to meeting its ambitious green building and energy targets but continues to be a leader in designing and deploying policies to increase the uptake of green building techniques. Its policies and programmes are well worth studying and it is certainly well worth visiting.

The idea of outsourcing non-core activities is well accepted and its use is increasing in many aspects of business due to:

• increased competitive pressures
• reduced product cycle times
• investor demands for results
• achievement of significant improvements in operating and financial performance.

Despite the increase in outsourcing in areas such as Facilities Management, IT and Telecommunications many organizations still own and operate their own energy assets. At a time when energy and energy management is becoming more specialized, and we need to increase investment in upgrading energy infrastructure to make it more efficient, the idea of fully outsourcing energy services needs to be properly considered by senior management.

Some energy management functions – notably energy procurement – are outsourced but there has only been a slow growth in fully outsourced solutions. Third party financing of energy efficiency investment is a form of outsourcing and will usually involve some kind of kind of energy service company and performance guarantees. Organizations considering third party financed solutions should consider how far they want to go in energy outsourcing and in particular assess the total costs of energy and utility systems, not just operations and maintenance or energy costs but also compliance costs and future capital needs – and all of the risks around utility supply. A systems approach is needed.

In my career I have been involved in various energy outsourcing deals which have come in several forms. In 2007 I published my first book, “Outsourcing Energy Management”, which summarized the reasons why management would consider energy outsourcing and how to go about it. It drew heavily on my experience of developing and implementing innovative energy outsourcing projects for Diageo, Sainsbury’s and other corporates and was conceived as a “how to do it” guide for management. Although the market has moved on it is still a useful guide for anyone considering what to do about the long-term future of their energy system.

The book can be purchased at:

https://www.routledge.com/Outsourcing-Energy-Management-Saving-Energy-and-Carbon-through-Partnering/Fawkes/p/book/9781138256248

and

https://www.amazon.co.uk/Outsourcing-Energy-Management-Steven-Fawkes/dp/1138256242/

In my book “Energy Efficiency” (http://goo.gl/qxV1PR) I quoted examples of energy efficiency technologies in different applications across buildings, industry, transport and IT but of course it was only possible to have a small selection in the book. I am always interested to find examples of energy efficiency in sectors or applications that that don’t get much attention. On my recent travels to the USA for the Investor Confidence Project (http://www.eeperformance.org) I read of two aviation related examples courtesy of the American Airline inflight magazine.

The first concerned the new $50 million flight simulators for the American Airlines 787 Dreamliner. Of course flight simulators in themselves reduce fuel use enormously by training pilots on the ground rather than in the air. However, the interesting thing about the new 787 simulator, made by CAE, is that it is all electric. Previous generations of simulator used hydraulics to provide the multi-axis movement that helps to make simulators so realistic. The net result is a 75% reduction in average power use from 48kW to 12kW and a 50% reduction in peak power from 144kW to 72kW – impressive(1). The reduction in peak power will also reduce the cost of supply infrastructure (a co-benefit) in a new facility. Although the replacement of a simulator will never be driven by energy costs, rather by the lifecycle of simulators and aircraft, when the change is made there is a significant reduction in energy use and peak power. The point of this example is that there is huge potential to improve energy efficiency in all of our buildings, equipment and systems – energy efficiency potential is everywhere – we just have to look for it and apply good engineering and product development skills to exploit that potential.

The other example from American Airlines concerns the use of iPads for flight planning. Airline pilots use aeronautical charts and manuals and used to carry 35 to 40 lbs of paper into the cockpit (hence the need for the boxy black flight bags that every pilot and wannbe pilot had/has to have). The paper has now been replaced by iPads loaded with charts and manuals as well as pre-flight information, weather and apps for things like cross wind takeoff limits. The 35 to 40 lbs of paper has been replaced by 1.5 lbs of tablet. American Airlines estimate that the reduction in weight will save $1.2 million a year in jet fuel – a small drop compared to their total fuel spend and probably hard to measure but every little bit helps. Taking a systems view there will also be savings in paper (and energy used to make the paper), fuel savings in ground transportation used to deliver the paperwork and other significant co-benefits – possibly including reduced pilot downtime due to injuries caused by lifting those flight bags!

On a larger scale in aviation one of the main benefits of the 787 Dreamliner itself is of course its fuel efficiency. It has recorded a measured, in-service, 21% reduction in fuel usage per passenger compared to a Boeing 767. The need for greater fuel efficiency is driving aircraft fleet replacement and the retirement of older aircraft including the venerable Boeing 747 which revolutionized long-haul air travel and made it more accessible to all. The iconic 747 will be sadly missed by many – me included – when it finally leaves service but the pressures to improve fuel efficiency in aviation are inexorable.

The escalating tension around the Ukraine has once again highlighted UK energy security. With the EU dependent on Russia for one third of its gas there has been a lot of media attention on gas supplies. The UK has taken a rather superior attitude by pointing out that we don’t import Russian gas and although technically true this ignores the fact that the European gas system is integrated and any disruption to supplies further East is likely to affect the UK. However, more importantly the focus on gas means that an important UK energy security issue has been totally ignored until now – and that is the problem of the UK electricity system using Russian coal. For some time I have been pointing out that a significant proportion of UK electricity is generated by Russian coal and that we should be concerned about this. Now I am glad to read in the Times (1st August) that Greenpeace has issued a report highlighting this issue and referring to the UK propping up Russian “coaligarchs” (great title). I don’t often agree whole heartedly with Greenpeace but on this issue I do.
 
UK dependence on imported energy rose to 47% in 2013, up from 43% in 2012. Coal generated 36% of UK electricity and 41% of that coal came from Russia. That means 15% of our electricity is generated using Russian coal and we are shipping off £1 billion a year to the Russian coal companies.
 
Well done to Greenpeace for highlighting the issue.
 
Energy use per capita and per unit of GDP continues to decline, total energy use fell 14% between 2000 and 2012 while the economy grew 58%. The old linkage between energy use and the size of the economy is broken – but in order to improve energy security and not be dependent on Russia (and other countries) we need to massively scale up energy efficiency across all sectors of the economy. We know the potential is there, we have the technology, and we know that as well as improving energy security enhanced energy efficiency brings many co-benefits including improved productivity, job creation and environmental protection. Massively scaling up energy efficiency is the least cost, least regrets route forward irrespective of your preferences on energy supply options. As we head into the 2015 general election, improving energy efficiency should be the first item on the energy manifesto of all political parties.