1

Profitable Solutions to Oil,

Climate and Proliferation

Amory B Lovins
PREP ReviewChairman
Meeting& Chief Scientist
Rocky Mountain Institute
The Profitable Transition to www.rmi.org

Efficiency and Renewables

ablovins@rmi.org

University of California
Santa Barbara, 5 March 2010
Copyright © 2010 Rocky Mountain Institute. All rights reserved.
A stupid multiple-choice test

Do you prefer to die of:

1. Climate change?
2. Oil wars?
3. Nuclear holocaust?
A stupid multiple-choice test

4. None of the Above

January 2009 McKinsey supply curve shows 70% of 2030 global
greenhouse gas emissions can be abated at an average cost ~€4/tCO2e
Profitable climate protection: How much can we do? How fast?

By 2100, global CO2 emissions will

• triple — if we reduce energy/GDP by 1%/y

• level off — if 2%/y
• drop (stabilizing Earth’s climate) — if 3–4%/y
Feasible?
Yes!
A 2004 roadmap for eliminating oil use by the 2040s

www.oilendgame.com
 A realistic oil solution at an average cost of $15/bbl (2000 $)

U.S. Oil Use and Import, 1950–2035

Source: Lovins, Amory B. et al. Winning the Oil Endgame. 2004 Rocky Mountain Institute. www.oilendgame.com.

35
government projection (extrapolated after 2025)
end use efficiency @ $12/bbl
Petroleum product equivalent consumption

plus supply substitution @ $18/bbl (max < $26/bbl)

28 plus optional hydrogen from leftover saved natural gas
and/or renewables Efficiency
first...
(million barrels/day)

21
Technical Annex 23. * Illustrating 10% substitution; 100%+ is feasible

14 Petroleum use

7
...then
substitution
Petroleum imports
0
50
54
58
62
66
70
74
78
82
86
90
94
98
02
06
10
14
18
22
26
30
34
19
19
19
19
19
19
19
19
19
19
19
19
19
20
20
20
20
20
20
20
20
20
Vehicles use 70% of U.S. oil, but integrating low mass and drag
with advanced propulsion saves ~2/3 very cheaply

150 mi/h, 94 mpg

Hypercar Revolution SUV (2000) Toyota 1/X sedan (2007)
67 mpg (114 w/H2), 1-y payback Prius size, 1/2 fuel use, 1/3 weight

Bright IDEA 1-T 5-m3 van (2009)

3–12×-efficiency plug-in hybrid, needs no subsidy
Fuel Energy
 Fuel Energy

87% Never Reaches the Wheels

 Fuel Energy

7% Drag & Rolling Resistance

 Fuel Energy

6% Accelerates the Car

 Fuel Energy

0.3% Moves the Driver

 Fuel Energy

2/3 is Weight Dependent

 Fuel Energy

1 unit at wheels = 8 units in the tank

Radically simplified manufacturing
“We must leave oil before it leaves us.”
—Fatih Birol, Chief Economist, International Energy Agency, 2008
1989 U.S. electricity-saving potential:
~75% at an average technical cost ~1¢/kWh (2008 $)
Lovins House, Old Snowmass, Colorado, 1984

–47˚F with no heating/cooling

equipment, lower construction cost

mid-1980s savings: ~99% of space-

and water-heating energy, ~90% of
household electricity, 10-month
payback
Inside, a tropical environment with 32 banana crops, no furnace
Integrative design in retrofitting the Empire State Building
 Lighting
ESB approach & Plugs

$8.7 M

VAV
AHUs
DDC minus Chiller Plant
Controls
$2.4 M $17.4 M Retrofit

$5.6 M
Radiative
Barrier
$4.4 M
$2.7 M Annual
Windows
Savings
$4 M
Conventionally, saving energy costs more and more
Cost

Savings
Conventionally, saving energy costs more and more
Cost

Savings
But integrative design can achieve expanding returns
Cost

Savings
World’s electricity usage

Worlds
Electricity
Usage
World’s electricity usage

Worlds
Electricity
Usage

60% Motors
World’s electricity usage

Worlds
Electricity
Usage

30% Pumps and Fans

Saving electricity in industry: motors, pumps, and pipes
69% less pumping power, lower capital cost
Energy efficiency: start downstream

Coal Energy Power Motor & Pump & Energy

Grid
Input Plant Drivetrain Throttle Pipe Output

100 Units -70% -9% -12% -55% -20% 10 Units

Energy efficiency: start downstream

100
50 Units 10
5 Units
Examples from RMI’s industrial practice (>$30b of facilities)
 >100× energy leverage in the EDS data center

Power
Power Plant 67% Cooling Lighting UPS Fans Supply Under-Utilization Inefficient & Inefficient
33% 4% 15% 10% 35% 85%-97% Zero-Value Business
Transmission • Compute Applications Processes
10% • Storage 10%-40% ??%
• Bandwidth
➙ ➙ ➙
then cut utility …then cut support …then cut IT equipment’s First debloat software and ensure that
losses by ~50% overhead by 90% internal losses by 75%… every computation cycle is needed

$
100W 30W 17W 9W .3W–1.5W .12W-.9W .00?W
Energy into Energy into Energy Energy Energy into Energy into Energy into
Power Plant Data Center Into Server Into Chips Applications Business Process Customer Value
Low- and no-carbon distributed generators
are rapidly eclipsing central stations
Low- or no-carbon worldwide
electrical output (except large hydro)
6000

5000 Total renewables plus

decentralized generation

4000
Non-Biomass CHP
Nuclear
TWh per year

3000

B
2000

Geothermal
Photovoltaics
1000 Biomass and Waste
Small Hydro
(<10 MW)
Actual Projected
0 Wind
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Year
The global power market is shifting rapidly to distributed generators

!$%&'$#!()(*'+),#-'.'/0123##
!"## 4))5'$#6(1#4770+%)89#:;;<=><:<#
)#$

(#$

'#$
+,-.$
&#$ /012131425,67$
%#$ 8964:5;$

"#$ Output additions

from nuclear fell
#$ behind PVs’ since
"**#$ "**($ %###$ %##($ %#"#$ 2007 and may never
!"#$ catch up
What “nuclear renaissance”? Here it is...
end 2009: 56
(24% of 1979
peak), or
4-odd % of new
capacity under
construction

Of the 56 “under construction” reactors shown by IAEA at 9 Feb 2010:

• 13 have been under construction for >20 years; 24 have no official start date; half are late
• 41 are in China, India, Russia, or S. Korea; 6 of 10 starts in ’08 and 9 of 11 in ’09 are in China
• All 56 are centrally planned, usually by authorities with a draw on the public purse
• Zero are free-market purchases fairly compared or competed against available alternatives
41
New nuclear plants will scarcely be able to offset old units’ retirements
 Nuclear is now the costliest of the no- or low-carbon resources

Moody's $7,500/kWe capex + Keystone O&M and financing: 15.2–20.6¢/kWh

Keystone (June 2007)

MIT(2003) 2009 order ~9–13¢

2007 US¢ per delivered kWh

2009 order ~10–13¢

2008 av. 8.4¢

net of 1¢ PTC

“Forget Nuclear,” at www.rmi.org/

sitepages/pid467.php;
“The Nuclear Illusion,” Ambio, in
press, 2010, preprint at
www.rmi.org/images/PDFs/
Energy/
E08-01_AmbioNucIllusion.pdf
Combined- CC Bldg Waste-
Nuclear Coal cycle gas Wind cogen cogen heat 43
cogen Efficiency
The cheapest and lowest-carbon sources save the most CO2 per dollar

Coal-fired CO2 emissions displaced 1¢: 93 kg CO2/$

2¢: 47 kg CO2/$
per dollar spent on electrical services
Carbon displacement at
various efficiency costs/kWh
kg CO2 displaced per 2007 dollar

New nuclear saves 2–20× less carbon per

dollar, ~20–40× slower, than efficiency and
micropower investments

Keynote high nuclear

cost scenario (6/07)

MIT study 03 Moodyʼs

estimate (5/08)

Combined- CC cogen Bldg cogen

Waste-heat
Nuclear Coal cycle gas Wind cogen Efficiency
U.S. coal-fired electricity avoidable by...
Cheaper than Efficiency = average of top 10 States (2005)
operating an old
coal-fired plant
Efficiency at average cost ~1¢/kWh

Queued windpower

Available windpower
~½ new-coal cost

Industrial cogeneration
Cheaper than power
from a new coal plant
? Building cogeneration

? Other renewables

Coal-to-gas redispatch
~2¢/kWh extra cost

Costlier than a new

coal plant now, but
Photovoltaics on 3% of structures
cheaper by the time you
could build one
TOTAL +? >22×
0 5 10 15 20 25
Index (U.S. coal-fired electricity in 2009 ≡ 1.0)
Transforming the electricity sector

Current System Next Generation Utility

Energy Efficiency & Renewables

Energy
Efficiency
& Renewables

Combined-heat-and-power,
Other distributed gen.

Natural Gas & Oil Demand Response

& El. Vehicles

Coal and
Nuclear
Coal and Nuclear
 PREP Review Meeting
The Profitable Transition to
www.rmi.org
ablovins@rmi.org
Efficiency and Renewables