fbpx
International

35 Years of Bold Steps in the Clean Energy Race: Part 1

An Interview with Amory Lovins and Jules Kortenhorst

As RMI celebrates our 35th anniversary as a nonprofit organization, we are in a very exciting, but also very critical, time in our race to a clean energy future. We recently held a web discussion, 35 Bold Ideas to Win the Clean Energy Race, with RMI CEO Jules Kortenhorst and Cofounder and Chief Scientist Amory Lovins. Program marketer Kelly Vaughn asked them what they think are the compelling proof points for a clean energy future, what individuals can do, what innovative projects RMI is working on right now, and what exciting developments we can look forward to in the market.

This first blog post from the web discussion focuses on what inspires Lovins and Kortenhorst to maintain hope that the clean energy race can be won. Questions and answers have been lightly edited for clarity.

Vaughn: What, over the last 35 years, has really inspired you and showed you that there is a reason to maintain hope that this clean energy race can be won?

Lovins: We’ve had gratifying success in launching revolutions in the efficient storage and use of energy. And that includes efficient and superefficient buildings and net-zero buildings. Very efficient industries are raising the bar quite distinctively in many sectors, such as superefficient and electric autos, shared and autonomous Mobility-as-a-Service business models, and reconceiving the whole electricity business around efficient, distributed, renewable, and resilient energy supply. Those are all well underway.

The world has had flat carbon emissions for three years running with 3 percent per year economic growth thanks to a combination of greater energy efficiency, some structural change (especially in big economies like China), and of course renewables now being 55 percent of the new generating capacity the world added last year. It keeps getting cheaper, and as it gets cheaper we buy more, and that makes it cheaper, and we buy more. Well, that positive feedback is just running away. The forecasters can’t keep up.

In efficiency, we’ve figured out how to make big savings cheaper than small ones. We get expanding returns there, too. Then combine this with some powerful policies, not just in the market economies like our own where we have competitive electric markets and so on, but also in places like China, which has shifted very decisively toward efficiency as a global strategy. We see the same thing emerging now in India, where going renewable is cheaper than coal. And those two countries were responsible together for 86 percent of the new coal-fired power plants built in the last decade. Now they’ve got over 300 billion watts in stranded assets because they’re realizing they won’t need them and it’s cheaper not to have them. They’re running the ones they have a lot less, and renewable strategies are taking over. This isn’t easy and there’s still a lot of hard work to do. But the world is now on the right track. It just needs to do it more, better, faster.

Vaughn: Over the past six months, what are the major shifts in global markets that either discourage you or provide confidence that this clean energy race is clearly moving in the right direction?

Kortenhorst: Of course when you look back at the past six months, you have to acknowledge an important transition: We now are under a new administration here in the United States—one that in many ways is looking at a completely different, and we would argue outdated, paradigm about the energy system. Its emphasis on revitalizing coal, its focus on accelerating access to new lands for coastal fuel exploration, and its disregard for the opportunities of energy efficiency force us all to wonder, “Is that really the direction that the United States wants to go?”

At the same time, the distracting contrast with the world around us is really quite clear. Last year in Marrakesh, when countries were together a year after Paris, there was a very clear commitment from country after country to stay the course. A commitment, for example, from China and India is visible not only through the on-the-ground work that they are doing to accelerate the deployment of renewables and energy efficiency, but also in how they are now working together to drive energy innovation. Countries around the world are agreeing that this is the direction of the energy transformation. They acknowledge that clean energy is going to lead to a more competitive economy and they want to be part of that.

But it’s not just at the country level. The increasing role of cities and provinces or states is also important to note. Just two weeks ago, Mayor Bloomberg brought out a book that emphasized the role of subnational governments in accelerating the energy transition. Excitingly, just yesterday, the city of Atlanta, Georgia, announced a new commitment to use 100 percent renewable energy by 2035. So this is spreading; people are recognizing that a renewable-based and efficient energy system is more attractive, is more competitive, is more resilient, and is therefore the way of the future.

We also see corporates playing an increasing role in this transition. We are working with over 200 members of our Business Renewables Center to support the buying of renewables across the United States. More and more companies are looking to be part of that transition. All of this is showing huge progress in the cost-effectiveness of the new energy technologies.

We’ve also been tremendously surprised by battery technology. We’ve had to update some of our models because the cost of battery storage is now so much lower than what it was, even in our forecasts one year or two years earlier. These trends are accelerating and are driving faster and faster deployment on a global scale. All of this is very hopeful news. It certainly raises the question of what direction the United States federal government might take. But at state and local levels—and around the world—we’ve seen an accelerating trend that is just unstoppable.

Vaughn: Amory, how would you respond to Jules’s comments about some of the uncertainties that the U.S. political situation has created for our mission, while we’re still seeing these very promising market trends?

Lovins: Well, when you have one nation out of 194 in the Paris agreement with a very different view of energy market realities than others, I think you’re bound to say that however much power they think they have, they won’t be able to get done a lot of the contrary moves they have planned, just as they’ve been frustrated in other ways by existing laws, practices, and market forces. But you know, in the United States we have a system of government brilliantly designed by some very smart people 200-odd years ago to make major dramatic change impossible at a federal level. They did a really good job of it. And therefore—as I articulated in my remarks just after the election—we need to remember that the president is not the federal government. The federal government is not all government. In fact, most of our energy policy has long been made at the state and local levels in this country.

And government is not the only (or, I would add, even the most important) actor in energy and climate policy. There will be a lot of turbulence within the president’s party as well, because some of the greatest employment-adding industries are renewables in states like Texas, the national leader by far, thanks to now Energy Secretary Perry and Iowa Senator Grassley. And those interests will be vigorously defended. But I think market forces will win and, through all the turbulence, the same trends will continue. To the extent that the United States forsakes any territory in policy or markets, other countries will happily occupy the vacated space and turn it to their own competitive advantage. One way or another, the job gets done.

Kortenhorst: A big part of the emerging debate at the federal level is our ability to maintain a stable electricity grid in the face of a higher and higher penetration of renewables. It is a very valid concern and an important question. We have been arguing for the longest time that an electricity system that is based on distributed, renewable resources—and a broad variety of both power generation and power demands—yields even more stable and secure systems. But there’s some uncertainty around this in the current administration, and Secretary Perry has just asked for a review on this matter. Now, his thinking is that the way in which we create stability in this emerging electricity system is by reverting back to centralized baseload power.

But Amory, you were just talking to me about a new technology you recently saw that enables us to operate a much more stable grid by virtue of solar power being much more attuned to the variability of the grid. Maybe you can talk about it. It is just one of the indications of the tremendous amount of innovation that is happening in the space.

Lovins: There are now microchips headed for market that enable a distributing technology like rooftop solar panels to look at the environment around them and lock on to the frequency you want, the voltage you want, and heal any faults in the network and tune themselves up to stabilize it under those conditions. In other words, distributed intelligence, rather than the central-planning model the grid has grown up with where there’s a dispatcher somewhere telling all the electrons where to go.

This way, with the distributed intelligence, even if the grid goes down in some places or many places, individual microgrids will continue to operate. That’s actually the way my house works. It’s the way the Pentagon aims to power all its military bases, because they need their stuff to work. And it’s a good illustration of energy meets information technology (IT), and how IT is meshing up with energy. It makes systems smart, and enables them to have these properties of cost reduction, transparency, choice, and resiliency that we could only dream of. Now that’s coming together with new business models, new financial tools, and new ways of settling transactions.

It’s a very exciting time. And I think it’s also significant that the Energy Transitions Commission just released a new report and energy projections a few days ago that the chairman of the Royal Dutch Shell Group called a full-throated call for a largely or wholly renewable future. He was among other leaders from the oil, gas, and electricity industries saying, “This is feasible, it’s profitable, and that’s where we’re headed.”

This is the first in our series exploring the important issues discussed in the webinar. Stay tuned for the next post coming soon or download the full transcript of the discussion.