Conserving energy was second nature to me ever since I grew up in Holland in the 1950s and 1960s. Memories of scarcity in the ‘hunger winter’ of 1944-45 were still all around. In my first apartment in Rotterdam in 1973, I switched out my incandescent ceiling lights with (indirect) fluorescent lighting. Since 1979 until I sold it in 1998, I pursued one energy efficiency upgrade after another in my Norwalk, Connecticut home.
However, it wasn’t until I became involved in the economics of clean energy, which I now do professionally, that I finally figured out how I really fared. The bottom line is that energy efficiency is of secondary importance. It should not be the first order of business because that will merely make a bad system better. My lesson in a nutshell: renewable energy adds more value to a home than energy efficiency ever can. I should have implemented a whole house systems approach to energy.
Only Making Energy Efficiency Upgrades is Like Putting Lipstick on a Pig
I learned the hard way that we are likely to fall into the trap of putting lipstick on a pig if all we do is make our home more energy efficient. Upgrade fever is so incredibly wasteful because junking that old appliance prematurely increases waste, and it’s probably not a sound decision when all is said and done. We justify the purchase of a new appliances by touting its ‘efficiency,’ and then we compound the mistake by buying it on credit. Then it becomes really inefficient! (Link here for an excellent New York Times article by John Tierney on the ‘rebound effect’ and ‘Jevons Paradox’.)
Consider a Whole House Systems Approach to Energy
Before you start making things more efficient, it pays to ask if that’s really your best option. I should have implemented a categorical whole house energy plan first, instead of incrementally spending money on presumed ‘energy efficiency’ upgrades, which included a switch from oil to gas. As noted on the U.S. Department of Energy website: “Using a whole house systems approach – considering the home as an energy system with interdependent parts, each of which affecting the performance of the entire system – it’s possible to design and build or renovate a house that produces as much energy as it uses over the course of a year.”
For those twenty years in my Connecticut home, I spent a fortune on things that sounded good and felt good, but quite possibly did not add up in the end. I began to realize this when I sold the house. Without a plan for a whole house systems approach to energy, I made decisions that later locked me out of other better choices I had not yet thought about. But I kept going on the ‘installment plan’ at the time.
Eliminating 30 Years of Utility Bills for a One-Time Investment
I first replaced my water heater that had been on a coil in the boiler with an ‘efficient’ one, and when gas came to our neighborhood, I then replaced my old oil furnace with a modern gas unit, and the math seemed to work. But in retrospect, I should have done my homework, and bit the bullet for a whole house Geothermal HVAC System much sooner. (Link here for an informative National Geographic article that debunks Ten Myths About Geothermal Heating and Cooling.)
With 400% efficiency (input electricity, output heat/cooling), I would have massively improved the value of my property, because it would have been paid off by the time I sold the house — by then I would have been selling a house with next to no heating bills! In Connecticut no less! (Link here for a simplified breakdown by Esquire on the average cost and savings of a Geothermal HVAC system.)
The investment trap is that saving energy only goes so far – you’ll still have utility bills. But with real renewable solutions, where you are generating energy on premises from clean sources, you are permanently eliminating the next 30 years of a good portion of your utility costs, for a one-time investment – even if you pay for it over 7 or 10 years.
Know What System You Are Making More Efficient — And Why
As a society, we are never going to switch to renewable energy if we keep on investing in making fossil fuels more efficient. Steve Hallett’s book, The Efficiency Trap: Finding a Better Way to Achieve a Sustainable Energy Future [Prometheus Books (April 23, 2013)], should be required reading for the energy efficiency crowd. He goes beyond the Jevons Paradox, showing how continued ‘efficiency’ improvements to the wrong system (fossil fuels), results only in an ever greater dependence, more pollution — not less — and an ever more brittle infrastructure.
Today, NYC is a case in point. The switch from oil to gas for heating, when often times a direct switch to renewable energy might have been possible, made the city less resilient— not more— and after Hurricane Sandy, it turns out resilience is what we truly need.
Government Needs to Get With the Renewable Energy Picture
Recently, I responded to the New York State 2014 Draft Energy Plan and pointed out the same logic (Link here to see my detailed comments on the plan). Oddly enough, we now have a commitment to 50% Greenhouse Gas (GHG) reductions by 2030, and 80% by 2050, except the details of the draft plan too often are more of the same. They are full of incremental energy efficiency improvements that add up to a whopping 15-25% reduction in GHG, and will never get us where we want to go.
That’s why Steve Hallett points out “the road to hell is paved with efficiency.” We’ll just burn fossil fuels at a slower rate, but we’ll burn them longer, so the uncritical pursuit of energy efficiency is counterproductive. That kind of efficiency achieves the opposite of what we thought we wanted, because we’re making the wrong system more efficient, instead of figuring out how to switch over to a new system — in this case, renewable energy — which is the only thing that can reduce greenhouse gas emissions.
How Valuable Will the Upgrades Be to the Property as a Whole?
Financially, the sellers of all these terrific energy efficiency widgets and appliances talk us into buying them by pointing out the payback from the savings provided by their technology. Sound financial decision-making should evaluate purchases based on what value the upgrade adds to the property as a whole. This means you need to have a long-term plan of where you are going: will you rely on fossil fuels, or renewable energy, or both? Before you’ve decided what the plan is, you won’t know what it is you are actually making more efficient. Maybe I’ll do a better job with the next house… These days, I try to reduce waste, of energy or otherwise, as rationally as possible, and teach others to do the same.
Readers of this article may be interested in William Maclay’s book, “The New Net Zero: Leading-Edge Design and Construction of Homes and Buidings for a Renewable Energy Future.”
A helpful review of the book is available here.
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