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McKinsey: US could Save $700 Billion Invest in Energy Efficiency
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by Scott Wu | July 30, 2009 at 02:45 pm
84 views | 16 Recommendations | 5 comments
Management consultancy McKinsey & Company released a report estimating an upfront investment of $520 billion in energy efficiency could save $1.2 trillion in waste, a net gain of $700 billion. It could mean a decrease of non-transportational energy consumption by 23% by 2020, or 1.1 gigatons of greenhouse gas emissions: equivalent to the emission of entire US fleet of passenger vehicles and light trucks.
The consultants stress that improving efficiency alone will not be sufficient. New power plants with low-carbon technology in place are needed to meet the energy demand and cut emission at the same time. If electric cars hit the mainstream market, there will be even higher demand on electricity.
To get around that, McKinsey proposes a cocktail—not a chilled one, but a cocktail of more government money and more government mandates. Of course, consumers will have to pick up the $50 billion-a-year tab through things like a power-bill surcharge. But McKinsey says the 8% jump in “energy costs” will be more than offset by an “eventual” 24% savings for regular Joes.
For the full report: Unlocking energy efficiency in the U.S. economy
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Spydermonkey
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kuuva
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Most RecentMost Recommended Comments (5)
at 17:24 on July 30th, 2009
Yes they could and so would many other countries as well.
at 21:43 on July 30th, 2009
Hope they would pick those low-hanging fruits, but I guess it's not easy because energy efficiency is just not that sexy of an idea.
at 18:49 on July 30th, 2009
What could happen does not always happen even if it is better.
at 09:39 on July 31st, 2009
oh great another McKinsey report, I need to see if I can find this one. These guys just restate what everyone has been saying probably forever. And yes we probably paid way to much for this report. To be fair they do sometimes come up with new ideas and they do pull together all the thoughts into one report. But to me they just do what managements all around the world should already have the competency to do on their own. Maybe fire all the managers of the world and just hire McKinsey?
Back to the energy thing. I dont think people really care. As long as power is cheap, people are not going to make an effort to reduce waste. Some cities are starting to require energy home audits before a home sale. They are not required to fix the problems just to point them out. I guess in Austin, TX they found most homes air conditioning ducts were leaking.
"Of the 310 homes that had been audited through last week, Austin Energy said 86 percent had ducts that leaked more air than is considered acceptable for energy-efficiency. The average was a 22 percent leak rate — more than double the acceptable level.
According to the utility, the energy lost from those leaky ducts equals the amount of energy that 67 average-sized homes would use in an entire year."
http://www.statesman.com/blogs/content/shared-gen/blogs/austin/theticker/entries/2009/06/09/austin_energy_first_audits_fin.html
same argument with fuel. Big engines use more gas than smaller ones, people are not going to shift to smaller engines unless fuel costs more.
at 22:27 on July 31st, 2009
Whether we like it or not, reports from McKinsey gets more attention. It's like the same words uttered from someone who has a shining Ph.D seem to make more sense than those without.
I'm with you on the part about people don't really care, well, most people that is. Cost disincentive is so much more effective than moral persuasion in the short run. Smart policies are require to push people to the right direction. One of the issues mentioned in the report is the fact that landlords don't fix inefficient appliances because tenants pay the utilities bills.