Why Can't We Just Turn Off The Light Ourselves?

Image: Evgeny Morozov

I went to a talk by Evgeny Morozov (@evgenymorozov) last night who is on a tour promoting his new book To Save Everything, Click Here.  It was an excellent conversation and one key takeaway from it for me was that the blind reliance on technology to solve many of our difficult social problems may be a futile.  Evgeny made the point that technology often emerges to solve a problem before the root cause is understood and that the proposed fix may create unintended consequences in addition to failing to remedy the original problem in the first place.  He even made the point that we may be trying to use technology to solve problems which really aren't problems at all.

Energy issues are attracting our attention these days and with that attention comes creative ideas for new businesses, products, and services.  Almost any new energy product assumes a need for cleaner operation or greater efficiency with a reduced need for finite energy inputs.  I buy into this to a large degree and enjoy seeing new technologies like smart sensors and distributed renewable generation systems pop up on a daily basis.  But as Evgeny discussed, disconnecting human consideration from the end result, no matter how well-intended, opens us up to downside risks.

Enlighted light sensor

The simplification and automation of energy saving in the way that companies like Enlighted are doing is exciting in many ways.  I wonder if we really need technological tools to do things like turning off lights when we don't need them on though.  Automated lighting controls address a situation where lights are left on at a constant luminosity all the time.  Why do we have so many applications where we are obviously wasting energy like this?  Even with automated lighting controls, energy is wasted if the lightening doesn't provide real -time value to building occupants.  

An additional unsettling aspect of the reliance on technology to automate the management of energy might be a decrease in our understanding of how energy systems work.  In past generations, we understood, appreciated and respected energy use more because how we harnessed energy was more simple and more labor oriented than it is today.  We were physically involved with carrying water, splitting firewood or turning soil for farming.  People were hyper-aware of wasted energy because it was their own physical effort.  Technology now separates us from energy production so much so that most people don't comprehend the vast network of people and products that keep our lights on everyday.  Further automation will lead to even less respect for energy resources and arguably cause more energy consumption paradoxically. 

Paradox

The speed of technological change is outpacing our capacity to consider the impact these of technologies and discuss with our communities the range of impacts they will have on us in the future.  In many ways, life is so much better today than it was yesterday and we should appreciate this.  We also need to maintain the essence of our humanity, part of which is the innate curiosity that created the technology that we see today.  Blind acceptance of new technology may end up stifling the spirit of innovation which spawned it and make us no better off than we were before.

Utilities are Fighting the Last War

The Maginot Line was backwards thinking on a grand scale

Military analysts are fond of pointing out that generals tend to focus future strategy and acquisitions on what was needed for success in previous conflicts.  Called "fighting the last war", it seldom works out well to look in the rearview mirror to see what is coming ahead on the road.  A modern military example of wrong way planning is with the Maginot Line in France following World War I.  The horrors and technology of trench warfare pushed French military planners to build a massive network of fortifications along the border of France and Germany.  While the Maginot Line did prove to be an effective barrier, it didn't account for the Germans to decide to just go around it.  The mental energy and commitment of resources to a static defense completely paralyzed the French army's ability to adapt to a rapidly changing set of circumstances.

I see a similar situation in the US energy sector today.  While at a recent energy conference, I learned that utilities fear two major disruptive forces that have hit the energy market in the last few years--impending carbon emission regulations and the collapse of natural gas pricing.  EPA regulations will force power plants to operate cleaner but added costs may be mitigated by reduced operating costs and/or offset by short term government incentives to switch.  Natural gas prices fell dramatically due to the unexpected rise in hydraulic fracturing and has made the economics of power generating technologies using other fuels hard to justify.  Because of the long timeline for power plant construction and operation for cost recovery, the precipitous fall in gas prices puts utilities in a dilemma since quickly switching fuels is not easy. On the bright side though, we already see natgas generation beginning to displace coal generation both saving money and reducing pollution in a win/win scenario ("clean coal" is also officially dead).  While these two effects throw utility forecasts for capital expenditure and price prediction into turmoil, they are being planned for and even have potential upside benefits to the utilities and ratepayers.

Clinging to centralized power generation may be as backward as the Maginot Line

The future that utilities don't seem to be prepared for and one with much more downside risk is a loss of ratepayers to distributed generation systems installed behind the meter (i.e. not connected to the grid).  Combined Heat and Power (CHP) systems run on natural gas and are now viable for a large number of building owners to replace their electric supply from utilities.  If electricity costs rise, more and more commercial and industrial utility customers will opt for CHP. Solar PV is also rapidly approaching grid parity much faster than anticipated.  The danger these two technologies pose to utilities is that they open up ratepayers to the option of completely disconnecting from the grid--something entirely new.  With even losing a small fraction of their ratepayer base to distributed systems, the utility revenue models significantly change for the worse.  Less utility revenue means more pressure to raise rates to maintain the grid and thus pushes more ratepayers away towards distributed systems.  A most unvirtuous cycle indeed.

Distributed generation of electricity for utilities is the Blitzkrieg that the French did not anticipate.  I talked about this in previous article about how solar PV (and CHP) represent a mortal threat to the utilities.  Unfortunately it seems that not all utilities recognize it as the existential threat that it is.  Progress happens and outdated technologies get replaced with better ones.  Unlike with the transition from regulated, wired telephone service to deregulated, wireless service, electricity infrastructure has safety (nuclear plants and superfund sites) concerns that can't be overlooked.  If fewer people are paying for the same grid infrastructure, where will the money come from to keep it working?  How will keep electricity both reliable and affordable if the utilities can't keep up with the trends?

Why We Don't Build Green

There seems to be a natural inclination towards green building practices yet traditional building methodologies continue to dominate in the United States today.  Green building is about reducing waste in the construction and operation of the building, proper site selection with respect to local ecology along with enhancing the health and quality of life of the occupants.  All seemingly good design goals but still usually prioritized lower than ROI calculations by developers.  The World Green Building Council released a report recently addressing ROI in that it is also superior in structures built with sustainability in mind.  Maybe this will be helpful in continuing the trend towards better building, but I think addressing a few of the reasons why we haven't adopted green building so far will be even more helpful in spurring change.

I've written before about how we are cursed with abundance here in the US.  My point was that we don't have to innovate on the energy front because we have significant traditional energy resources that feed an energy generation infrastructure that still works (albeit typically near the end of its design life).  Dan Burris in Flash Foresight makes a similar observation about how developing nations have the ability to skip the incremental technology gains that we've had to slog through and just adopt the latest and greatest stuff.  I still think this situation is the primary reason (i.e. we don't have to change) we don't see more growth in green building or in clean energy system development.

Here are a few of my observations about why green building continues to languish in the margins:

Construction professionals have years of experience building and designing in a particular way.  Without formal training, many are unwilling or unable to do things differently and formal training is costly in time and money.  Often local building code is too restrictive and government bureaucracy too slow to meet the speed of change.  Since building construction is a such a collaborative process involving so many people like architects, engineers, code officials, product manufacturers, skilled trade workers, building management companies, and the owners/occupants, any new techniques that would be innovative enough to make a significant impact in terms of sustainability are usually too complicated to pass through the gauntlet of these disparate stakeholders.  The end result is that we seldom bother with innovation and build buildings the way we always have.

Another problem is that green buildings seldom seem any different than a non-green one.  The key stakeholders may not see much reason to go through the effort without an end result that wows them or their clients.  Incremental enhancements in air quality, lighting, or energy savings often goes unnoticed.  No one can see where building materials were sourced without explicitly stating this with signage.  Local environmental amelioration is also hard to tell without educational efforts.  To encourage more green building people have to see and feel that they are getting something more for the struggle.

A third big reason that green building is held back in the US is the stagnant building market as a whole.  In parts of the world where any significant building activity is occurring, green building principles are at least considered if not completely implemented.  Developers here feel lucky to get any projects going so pushing the envelope with respect to innovative design or cost constraints is dead on the drawing board.  Developers typically give the customer what they want anyways and lowest cost is what almost all the customers want. Without an external force mandating better design features and building products, the US market will continue to see green building as merely an academic exercise for a small group of idealists with deep pockets.

Timing is key to getting good ideas off the ground.  Green building is a great idea.  The speed of technological change across industries we are seeing means that we can't afford to adopt innovation in a merely incremental way though.  We need to develop an ability to discard old practices before they are obsolete.  If we don't, our building practices and construction professional talent pool will fall behind other parts of the world and we won't be the innovative nation that got us to the point where we are today.

Solar a Mortal Threat to Utilities

It appears that the public is waking up to the obvious threat that solar is to the status quo energy providers.  We live in an age of accelerating change and disruption.  I wrote last year about how solar will continue to expand rapidly into the general market regardless of what the utilities do to discourage it.  What today's Wall Street Journal piece means to me is that the national dialog will start to become even more rancorous with respect to clean energy issues.

David & Goliath -- Distributed Generation vs Traditional Utilities

Unfortunately, there is some truth to the fact that solar is currently only feasible for the wealthy and that federal tax credits could be seen as a transfer payment from average tax payers who can't afford solar to wealthy ones who can. The consequence of this dialog will be the elimination of federal and state incentives for distributed generation systems. Solar already has unsubsidized grid parity in many markets so growth their will continue to drive down the global costs for installing solar.  Companies like Solar City & Sun Run will have to re-model their current business plans, and I doubt they will weather the storm very well since their profitability is so tied to the current incentives.  New installation company concepts will emerge though and I think more traditional contractors will finally get into the game.

http://greenzu.com/solar-energy-political-cartoon

Utilities may go further and try to ban the connection of solar systems to the grid. Standalone solar with back up systems will be ready for the market by the time this happens though. Essentially this will be the last arrow in the utility's quiver to stop the rising tide of distributed solar. At that point, we'll probably cross the tipping point where they don't have enough rate payers to maintain affordable rates. Then things get really ugly.

While I am advocate for progress and technological innovation, crippled utilities will be a major issue for an already crippled political system to address. Add this difficult situation to the already huge list of complex issues that we don't seem to be able to effectively address (national debt, climate change, social security insolvency, resource depletion, population growth). The brinksmanship games we are playing will take on an entirely new dimension when we start to have daily brown outs and extended power outages.

The Dirty Side of Deregulated Energy

I've written about deregulated energy markets in a previous post.  While every deregulated state is not the same in how they run their energy programs, most often clean energy development needlessly suffers when clean energy tariffs are integrated with generation fees.

Distribution is not the same as generation--this matters to clean energy

To drill into this a little bit, we pay separate charges on our bills based on our consumption for generated energy and for the distribution of that energy to our location (there is also a flat metering charge).  Taxes and green energy tariffs are assessed on top of these fees based on the amount of energy consumed.  In a deregulated market, consumers have a choice of purchasing the generation portion of their bill from companies other than their local utility.  The local utility provides the distribution services (power line maintenance, service for power outages, billing, etc) regardless of where the power is purchased from.  This is good for consumers in that they can get the best price for their electricity and even get added value from companies like Power2Switch.

When clean energy tariffs originally went into effect, legislators associated them to generation which was logical since the clean energy fund was intended to mitigate environmental issues with coal, oil, gas, and nuclear generation plants.  As a consumer used more electricity, they would pay more into the fund to encourage better energy (seems fair to me).  Clean energy funds came about in the context of Renewable Portfolio Standards (RPS) which are self-imposed mandates requiring clean energy to make up a portion of total electrical generation.  With an RPS and clean energy fund, the idea is that more local clean energy systems would pop up to meet the RPS over time.

The sun is setting unnecessarily on some clean energy incentives

The wrinkle in this good plan is that with deregulated electricity, consumers pay money to companies outside of the original clean energy tariff structure for their generation so these tariffs don't get collected.  The consequence is that the funds for local solar and wind projects dry up as is happening in Illinois right now.  The easy fix is to shift the clean energy tariffs to the distribution portion of the electricity bill since that money is paid to utilities within the RPS umbrella.  Rate payers don't pay anymore on their bills than they originally would have and local clean energy gets the boost it was intended to get.

Legislation, like making sausage, is typically an ugly process.  This is a unique example of a simple fix that will have significant positive benefits for us all.  I encourage my fellow Illini to support the bill to fix the Illinois RPS.

Think Waste Before New Technology

In a natural ecosystem, energy flows from organism to organism.  Plants feed animals which feed other animals in the food chain.  Decomposition replenishes plants and the cycle continues in a closed loop.  There is no waste in nature, only different forms of useful energy that is shared and transferred.

Man is not separate from nature but we have struggled to be separate in some sense.  We struggle to keep the elements, predators, hunger, disease and decay at bay in an effort to extend our lives as long as we can.  We build things to endure the destructive forces which play such a key role in making the ecosystem of planet Earth work so well.  We are self-aware and we can anticipate threats--because of this we have thrived.

Our success is becoming our undoing however.   In the spirit of progress, we've created materials, chemicals, structures and even new elements with little regard for how these new things fit into the balance of life on Spaceship Earth. In fairness to us humans, we don't view ourselves as a hive of interchangeable or even disposable units working for the greater good.  We struggle individually in a symbiotic relationship with other humans but ultimately for our own welfare.  We now know that our relationship with other Earthlings is much less mutually beneficial and our own survival is now at stake due to natural corrections.

http://nickandzuzu.com/2010/06/symbiosis/symbiosis-06-27-10/

My point to this post is to highlight that a single-minded focus on new technology to solve our environmental, economic, and social issues we face today needs to be balanced by paying even more attention to the waste stream that we create.  Heat escaping from a building in the winter, concentration of toxins from the exhaust pipe on vehicles, creation of single use, disposable items and the harvesting of vital materials faster than the replacement rate are examples of in-balances where new technology may not be the best solution of the problem.

Linear design philosophy created plastic water bottles; the producers of the bottles had no concern for what happened to the bottles once they served their purpose.  Under a growth economic paradigm, linear design is preferred since it encourages consumption and economic activity.  Cradle to Grave design accounts for all the energy inputs required to make something and considers how these inputs will be recovered at the end of its useful life.  Not only is energy conserved but externalities like pollution & solid waste are mitigated.

Unfortunately life-cycle analysis does not fit well with our current economic model.  The very nature of money relies on growth.  Einstein may have called compound interest the "most powerful force in the universe" but we are now realizing that economic forces invented by humans don't trump the finite physical resources that we have to work with here on Earth.  We can't unlearn what we now know about human impact on our ecosystem.  We need to tap into our self-awareness and ability to plan ahead to modify our social structures to accommodate better ways to mitigate our impact and not just wait for a new gadget to come along to save the day.  More solar panels are great but not needing more solar panels is even better.

http://cartoonstudio.co.uk/cartoonist-for-hire/tag/total-quality-management-cartoons/

Water heating is bigger than ever

A lot has changed in energy since the 70's, but we still use a lot of it.

We do have a bit of good news on the residential energy efficiency front.  The average American home uses just about the same amount of total energy as it did 30 years ago despite a rising standard of living and more plug-in creature comforts than ever before.  It's actually trending down on a per household basis.

I see two problems with this however.  First of all, we have a whole lot more homes today than in 1978.  We're around 115 million households today where we were only at 68 million in the 1970s.  While flat or even slightly declining per household energy consumption is great, 47 million new households means that we're using a lot more energy on the whole than ever before.

Where we use energy in our homes--1978 and today.

The second problem I see with this data is highlighted in the two pie charts above.  Where we use energy has shifted rather dramatically.  Due to key improvements in building technology and code, space heating accounts for much less of our homes' energy budget.  Air sealing, insulation, and mechanical system efficiency enhancements have worked.  This was low hanging fruit though and further total efficiency gains are going to be harder to achieve.

Take a look at the water heating portion of the chart.  20% of our residential energy goes to heating up water for showers, cooking, and cleaning.  This is a very predictable energy load that is completely unrelated to any other mechanical system in the house or to the quality of the building envelope.  As we look to make further cuts in per capita and total energy consumption, the water heating load is an excellent place to focus.

Germany has far less sun & far more solar than the US.  No one thinks the Germans are flaky environmental nuts either.

This is where solar water heating can make a big impact.  We have more than enough sun anywhere in the US to offset the water heating energy requirement with existing solar collector technologies commercially available today. Despite the cyclical ups and downs on the prices of specific types of energy, energy efficiency strategies enacted today will pay for themselves over the long run.

The answer to our energy problems rises every morning.

Changing Times

Renewable Energy World had an article this morning that caught my attention.  The gist was that we have all the proof we need of man made global climate change and all technical tools we need to fix it.  Implementing these fixes won't reduce our standard of living; to the contrary, our collective way of life would be better in a clean energy economy.  For a number of reasons, however, solar hasn't gained the traction that it needs to be a robust industry and we are far from gaining the critical mass necessary for clean energy to dominate the total energy landscape.

Why?  I think the following reasons are part of the total answer:

• Fear of change in the popular mind
• Corrupt politicians on the take from lobbists
• Procrastination
• Nefariousness cabal of fossil fuel executives working for their own benefit to the detriment of society
• Ignorance of the complete cost-benefit profile of clean energy vs traditional energy
• Lack of inspirational leadership to point us down the right path
• Catch-22--we don't know how it will work because no one has implemented it and I want to wait for proof

We're at a societal crossroads now.  Economic issues are forcing our hand even before environmental ones have.  Either way, moving to clean energy is the right path as generation costs from dirty sources continue to swing widely and increment upwards.  Brace yourself for a rocky ride and don't fight the trends.  Flexibility is the key but so is recognizing that today's world will look vastly different than tomorrow's.

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Come gather 'round people
Wherever you roam
And admit that the waters
Around you have grown
And accept it that soon
You'll be drenched to the bone
If your time to youIs worth savin'
Then you better start swimmin'
Or you'll sink like a stone
For the times they are a-changin'.

Come writers and critics
Who prophesize with your pen
And keep your eyes wide
The chance won't come again
And don't speak too soon
For the wheel's still in spin
And there's no tellin' who
That it's namin'
For the loser now
Will be later to win
For the times they are a-changin'.

Come senators, congressmen
Please heed the call
Don't stand in the doorway
Don't block up the hall
For he that gets hurt
Will be he who has stalled
There's a battle outside
And it is ragin'
It'll soon shake your windows
And rattle your walls
For the times they are a-changin'.

Come mothers and fathers
Throughout the land
And don't criticize
What you can't understand
Your sons and your daughters
Are beyond your command
Your old road is
Rapidly agin'
Please get out of the new one
If you can't lend your hand
For the times they are a-changin'.

The line it is drawn
The curse it is cast
The slow one now
Will later be fast
As the present now
Will later be past
The order is
Rapidly fadin'
And the first one now
Will later be last
For the times they are a-changin'.

- Bob Dylan The Times They Are A-Changin'

Solar doesn't care what utilities want

For any of you who haven't heard of Ray Kurzweil, I highly recommend reading up on his Singularity theory.  He's a fascinating guy and his ideas are even more so.  Pertinent to my interest in solar technology, one component of Kurzweil's Singularity ideas is that technology advances at an exponential rate which is profoundly disruptive to existing technology.  Just as with financial investments, past performance does not predict future returns.  People in the heart of the change often have trouble seeing that straight line forecasts often fail to capture the future impact of a particular technology. Such is the case in the solar business today.

Worth a read

Solar PV is a transformative technology that is already disrupting traditional utility delivered energy models. A recent McKinsey study sums up the current state of PV rather succinctly and charts a few forecasts into the next couple of decades.  In some market segments, PV already competes effectively on price per kWh delivered; in others, the expectation is that other generation technology will continue to dominate but not for much longer.

No one is "letting" distributed solar happen.  In fact, it's becoming adopted despite countless institutionalized roadblocks.  This interaction between Travis Bradford and Barry Cinnamon highlights a critical misunderstanding that many people have about how distributed solar will develop.  We aren't waiting for utilities to let people install systems (via interconnection & net metering policies), and we actually don't need more incentives from the federal government (maybe these have only inflated installation prices anyways).  While both these components have facilitated system installation in the short term, the greater driving trend is the narrowing gap between the retail rate for electricity and the installed cost of solar.

Net metering is serving a great purpose today in helping to grow solar but the electric utilities would like to see it go away because they lose money from it.  At a much larger solar penetration rate than we have today, they would have to raise rates to cover the lost production and distribution charge revenue.  At a TVA sponsored solar event last month, I heard multiple utility representatives talk about how this hypothetical problem should cause us to temper if not even retard current PV installations. Regardless of what happens to net metering, distributed solar is going to continue grow and because of the easily scalable nature of it, I'd bet it will be at an exponential rate as Ray Kurzweil's hypothesis would predict.  Here are three reasons why I think so:

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Solar is Easy to Install

and it's getting even easier to do so.  The only downside of solar right now is first cost.  Not only are installation prices falling and retail utility rates rising, there are many new financing options to minimize solar's first costs. There is really no reason that a person can't decide to go solar one day and have the system commissioned the next.  Any red tape would only come from utility interconnection and this is irrelevant in solar water heating or in the case of my next example.  When all the economic forces align, we will see neighborhoods transformed from zero roofs with solar to most of them in very short order.

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Real Time Consumption of Solar Production

No need for utility permission to buy less electricity by producing it locally

All commercial customers and many residential ones are on a Time of Use (TOU) or real-time pricing plan with their electric utility. This means they pay a variable rate for electricity over the course of a day depending on the wholesale rate (cheaper at night, more expensive during the day).  Since solar PV production correlates well to peak rate periods, you can size a cost effective system today to lop off real time demand from grid power without selling any excess energy back to the utility.  If the customer pays $0.25 or more during the middle of the day for electricity, a PV system sized to meet this midday load is cost effective today.  This behind the meter PV system would be invisible to the utility while saving the building owner money.  There is a huge amount of potential new solar work just for this application.

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Back Up Energy Systems

Many businesses and homes want or need back up generators to guarantee access to electricity during interruptions of grid service and they are willing to pay a premium above the retail rate for electricity to do so.  Brown outs, ice storms, lightening, squirrels, etc. knock out power on a rather regular basis in some areas.  For someone considering a generator, they'll need to figure in the cost of the fuel to power it, the transfer switch wiring in addition to generator itself.  The generator will also have to cycle regularly to keep in optimal performance shape and fuel costs could be significant depending on whether the building has access to natural gas or not.

Inverters offer energy arbitrage options in addition to battery backup functions

An alternative today is a grid tied PV system with battery backup.  This allows for the triple benefit of back up power, peak load rate shaving, and energy arbitrage (charging batteries with off peak rate electricity and using during peak times).  All this adds up to more benefit than a generator backup.  Battery technology has been improving in cost and performance just as PV technology has.  This is yet another way that a PV customer could have a cost effective system for their needs and never need to sell anything back to the utility or need any sort of special agreement to go solar.

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Thomas Friedman called it the democratization of energy and this is exactly what solar offers.  Individuals now have the option for the energy source of their own choosing.  Utilities have a stranglehold on options just as telephone companies did before the advent of cell phones.  How many of you even have a landline at your house anymore?  How many of you will be at the mercy of electric utilities for service in 10 years?  I think the numbers will be very similar.

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We are like tenant farmers chopping down the fence around our house for fuel when we should be using Nature's inexhaustible sources of energy — sun, wind and tide. ... I'd put my money on the sun and solar energy. What a source of power! I hope we don't have to wait until oil and coal run out before we tackle that.
         --Thomas Edison

Energy Factor and water heating technologies

A different sort of green home

According to the US Dept of Energy's website, energy factor (EF) indicates a water heater's overall energy efficiency based on the amount of hot water produced per unit of fuel consumed over a typical day. This rating applies to a variety of water heater equipment: tank-style (storage), tankless/on-demand, and heat pump water heaters (HPWH).


Solar water heating has a very similar rating called the Solar Energy Factor (SEF).  Solar equipment is evaluated for thermal performance efficiency by an organization called the Solar Rating & Certification Corporation (SRCC).  The federal tax incentives for the installation of solar equipment are contingent on the solar water heating equipment having been evaluated by the SRCC.  The SRCC developed the SEF for the purpose of comparing solar water heating systems to a standard 50 gallon residential water heater in an apples-to-apples sort of way. Many natural gas utilities use the industry standard EF rating system to award rebates for high performing water heating equipment.  Since SEF is the solar equivalent of EF for a standard water heater, my view is that solar water heating systems that meet EF ratings for high performance equipment should qualify at a minimum for the existing utility rebate programs.


So how do different water heating technologies measure up with respect to energy efficiency?


Tank storage water heaters

Bradford White 40 gallon gas water heater

Typical residential storage water heaters range in size between 40 and 80 gallons.  This volume of water is heated up to the desired temperature (120 degrees F); the heating element or burner cycles on and off as a thermostat in the top portion of the tank detects adequate heat or not.  This is usually the least expensive water heating technology to install but is also normally the most expensive to operate. Recovery of the heat in the tank during and after use can be slower than with other water heaters which leads to the cold showers in high use situations.


EF rating for gas heated tank water heaters:

• Low efficiency -- < 0.62
• Medium efficiency -- 0.62 to 0.67
• High efficiency -- 0.67 to 0.82

EF rating for electric heated tank water heaters:

• Low efficiency -- <0.90
• High efficiency -- up to 0.95

Keep in mind that EF rating is only with respect to the energy efficiency of the appliance.  The electricity that heats the water in an electric tank model could be coming from sources with varying degrees of efficiency and environmental impact.

Tankless

Tankless water heater (top right) in conjunction with a solar water heater

Also called on-demand water heaters, these units heat water as it flows through the device.  They are capable of reducing water heating costs 10-20% due to the elimination of standby losses (constantly heating a tank of water even when no hot water is needed).  Tankless units come in electric, natural gas, and propane versions for different markets.  Not only are these a bit more energy efficient than tank style water heaters, they are also compact, wall mounted devices to save space in the mechanical room and they can provide almost unlimited amounts of hot water.


The EF rating for gas-fired tankless units ranges between 0.82 and 0.96. 


Heat Pump Water Heaters

From DOE

In a heat pump water heater, electricity is used to move heat from the air around the HPWH into the water tank versus directly heating the water with resistance coils.  Since the heat pump cycle can take a significant amount of time to heat or reheat a tank of water, electric resistance coils are included in HPWHs to augment the recovery of the water heating and thus minimize cold shower scenarios.  HPWHs can be very energy efficient and cost effective when the HPWH is operating in the heat pump mode; they revert to EF ratings of electric water heaters when the resistance coils kick in however.  Like with many things in the sustainable building world, efficient design is only part of the total picture.  How something is used in the real world effects its overall efficiency. 


EF ratings of HPWH in hybrid mode is 2.20 and fall off towards 0.93 in electric mode (average ~1.60).


Solar Water Heaters

In solar water heaters (SWH), the heat from the sun's radiation is transferred to drinking water during the day and stored in a tank of water for use throughout the day and night.  In homes where a 40 gallon tank water heater is appropriate, you'll find a 60 gallon solar storage tank. Because the amount of energy to move the heat from the solar collectors to the drinking water is minimal and the sun's energy is free, the operating costs of SWHs are the lowest of any water heating technology today. They are also the lowest carbon option when the system offsets fuel from gas appliances or electricity from coal-fired plants. SWHs have the highest upfront cost in the water heating space, but federal and state incentives exist to encourage their adoption since they provide a benefit to both the system owner and society as a whole.


Calculating EF from the SEF rating developed at the SRCC is done with the following equation: SEF x (1 - SF) = EF. SEF and SF (Solar Fraction) are calculations from the OG-300 report on each system found at www.solar-rating.org. EF ratings on SWHs range from 0.93 up to over 5.70 depending on the size of the system, location, and back up fuel option.


Summary
The less you pay upfront for a water heater, the more you pay over time.  As fuel prices of all sorts rise in the future, an investment in efficiency today will pay increasing dividends over time.

How to sell a solar water heater in a market with cheap natural gas

With the price of natural gas at a historically low point, selling a solar water heating system in natural gas water heater markets is a tough proposition. While we have to address return on investment as solar professionals, there are many other factors that go into a customer's decision making process about going solar. Solar water heating isn't for everyone so broad brush approaches won't work. The key is to target the right audience with the right message before you spend much time or money. The following is a guide to help you do this.

What to talk about

John Cole Cartoons

People are interested in distributed solar energy for a number of reasons.  Residential solar water heating continues to be an exceptional option in the portfolio of clean energy choices a homeowner has.  Energy cost savings is just one aspect of a clean energy purchase.  Make sure that you are talking about all the other reasons for pursuing solar.  Here are some good ones to start with and expand upon:

• Solar water heating (SWH) is a cost effective way to reduce home energy consumption by over 10%.
• Like electric vehicle purchases, SWH is a visible commitment to clean energy for a much lower sticker price than any car.
• When built into a new home, the net cost of a SWH is on par with the cost of a tankless water heater yet SWH outperforms tankless units in energy savings (EF of 0.82 for tankless vs 1.4 for SWH)
• While low now, the price of natural gas is set to rise with growing demand from electrical generation and transportation as well as with increasing scrutiny of hydraulic fracturing (fracking) practices. A SWH installed today is a hedge against rising fuel prices.
• Talk about the avoided costs & externalities of fossil fuels. Natural gas may be cleaner than coal, but it's hardly clean in comparison to solar water heating.
• Solar water heating creates local jobs--engineering, installation & service, sales & marketing, and distribution.

Tell the story to the right people

You need to maximize the impact of your messaging by positioning them in front of the right audience. The right audience is one that is both receptive and responsive to your point of view. To encourage a conversation and spur interest in SWH, the best approach is a combination of Facebook and blogging. Articles that address your messaging can't be neutral. You have to make a point either with your own blog posts or with comments on articles written by others. Your opinions may alienate some people, but those people are probably not receptive or responsive to clean energy issues in the first place--your target customer is. There are people out there who are concerned, knowledgeable, angry, and ready to act if they find a leader in their community with a solution that resonates with them. Solar is part of the solution and you are that solution provider.  Don't make any assumptions about who a receptive and responsive customer might be; stirring up a conversation about the issues that got you into the solar business in the first place will bring them to you.

Where to tell the story

Web marketing is a hot topic with lots of nuance.  It is an essential part of modern business and is redefining the fields of public relations, promotion, sales, and general marketing.  In the interests of getting you started today, I suggest working with the steps below.  Expand and modify as you get more comfortable and learn more.

1. Find an article that resonates with you and your team.  Get your friends, family or co-workers to suggest an article to post and select one.
2. Post the article to your Facebook business page (make a Facebook business page if you don't have one and encourage people to "Like" it).
3. Make comments on this post that tell your target audience why this article is important to you. 
4. Get all your friends, family, and co-workers to "Like" the article so their network sees it too.
5. Directly ask people to read and comment on your post (via email, phone, twitter, FilterTweeps,  etc).  
6. Repeat every workday.

Once you get comfortable with this daily effort, you can branch out a bit by writing your own blog articles.  Post it to your company website or some other website (Tumblr, Blogger, etc).  Use this as your Facebook link of the day and encourage the comments as suggested above.  Also while Facebook is the current dominant player in social media, explore using other sites like Twitter, LinkedIn, Google+, or any of the other growing number of websites to expand the reach of your effort.

Keep at it

Cheap natural gas makes for a difficult sales process for solar water heating. Difficult but not impossible. Continually remind yourself why you got into this business in the first place and find creative ways to connect with like-minded people. Tell people about your company and its goals.  Keep people continuously aware of your projects to build on successes. Help people connect their daily behavior to greater social trends. Be consistent, be informative, and be real. You'll begin to find that the right people will find you.

Talking solar at the CCGT

I spoke for the second time at the Chicago Center for Green Technology last Tuesday night.  The first time was last September and it went well enough for them to invite me back for another go at it.  My presentation covered solar water heating technologies in a broad way and has been set up to be a continuing education course for AIA architects.  Despite it being Valentine's Day, we had a rather large turn out with over 40 people in the audience.  The CCGT has been seeing strong attendance with all the their courses in this winter session.  I feel the general awareness level of the public is continuing to grow with respect to sustainable building practices and with solar technologies in particular.  The questions from the audience were more technical and specifically focused for projects that people are seriously considering.  I have even had 2 subsequent site evaluations from my talk for solar projects in Chicago from people interested in solar for their particular buildings.

 
I speak all the time about solar water heating and solar technologies in general so feel free to reach out to me about arranging a talk with your group!

The Atlantic's The Most Important Graphs of 2011 (Energy)

From The Atlantic's The Most Important Graphs of 2011

4. ENERGY, ENERGY, ENERGY

Oil Profits v. Oil Prices

"Big oil companies make larger profits when oil and gasoline prices are high.  These revenues come from the pockets of everyday Americans.  The five biggest oil companies - BP, Chevron, ConocoPhillips, ExxonMobil and Shell - have already made $100 billion in profits during the first three quarters of 2011 due to high oil prices. Yet they and other big oil companies have fought tooth and nail this year to retain tax breaks worth $4 billion annually." -- Daniel J. Weiss, senior fellow, Center for American Progress

The Most Disastrous Year Ever

"The National Oceanic and Atmospheric Administration reports that the United States set a record with 12 separate billion dollar weather/climate disasters in 2011.  Total damages were approximately $52 billion.  NOAA Chief Jane Lubchenco noted that "what we are seeing this year is not just an anomalous year, but a harbinger of things to come for at least a subset of those extreme events that we are tallying."  She noted that some of the increase is driven by climate change." -- Dr. Joe Romm, Senior Fellow and Editor of Climate Progress

A Century of Love for Oil and Gas

"Many conservatives have attacked the Obama administration's effort to invest in emerging clean energy technologies, including wind and solar electricity generation. Yet they defend longstanding tax breaks for the mature oil and gas (O&G), and nuclear industries. However, the federal government annually spends an average of thirteen times more money on the oil and gas industry compared to investments in renewable energy." -- Richard Caperton, Director of Clean Energy Investment, Center for American Progress

Our Competitors' Green Investments

"On the two-year anniversary of the American Recovery and Reinvestment Act, we should look back with satisfaction that we have seen the American clean energy industry through a rough period in the global economy. However, the United States risks ceding its gains and falling dangerously behind its competitors without continuing investment.  Many conservatives oppose such investments.   Without it, the United States will see an exodus of firms and capital to countries that  are growing their clean tech industries, particularly China and Germany. U.S. private-sector firms lament a lack of clear and consistent policy on clean energy. This stymies investment and slows job creation." -- Bracken Hendricks, Senior Fellow, Center for American Progress

Where the Green Jobs Are

"The failure of several clean energy companies that received loan guarantees have many conservatives increasing their opposition to such investments.  However, clean energy has been a bright spot in the sluggish economy.  The clean economy sector focused on clean energy--especially wind, solar, fuel cell, smart grid, biofuel, and battery companies--grew far more quickly than the economy as a whole. A Brookings Institution report found major job growth in clean energy between 2003 and 2010: Solar thermal and wind grew by 18.4 percent and 14.9 percent, respectively." -- Kate Gordon, Vice President for Energy Policy, Center for American Progress

A little perspective about Solyndra

My summary of the Solyndra story:

• Company launched in 2005 to create a unique thin-film (CIGS) solar module to avoid using expensive (at the time) silicon as most other solar companies use.  They took a calculated business risk to create an innovative product to address a gap in the marketplace.

Solyndra's technology & value proposition

•  Prices of silicon collapse in 2009.
• Almost overnight, the business case that Solyndra was trying to make completely reverses.  More efficient panels are now the same price as Solyndra's less efficient panels.
• Solar panel manufacturing has been extremely turbulent from the beginning so Solyndra stays the course and attempts to weather the storm.
• On May 26, 2010, President Obama gives a speech at Solyndra headquarters to tout his commitment to American job and clean energy development. This was a company that both the Bush and Obama administrations wanted to associate with for political purposes.
• June 2010: Solyndra is producing 30MW of solar panels per year and is in a tie as the 10th largest thin film manufacturer. 
• November 2010: Solyndra gets a $535 million loan guarantee from the 1703 loan guarantee passed in 2005 by the Bush administration.
• Silicon prices continue to fall hitting a 6-year low in June 2011 (~$50/kg from ~$470/kg).

A solar cell nestled in raw polysilicon

• Solyndra tries to restructure its loans again in August 2011 but is refused and subsequently loses a contract with the US Navy.
• Bankruptcy--September 1, 2011

Solyndra was an innovative company in a dynamic market.  The founders took a big risk in a very risky business.  Like other companies in other industries, they lobbied the government for special consideration and like other companies in other industries, they got it.  Governments facilitate markets and companies participate in these markets.  My view is that clean energy companies should get special consideration because they promote technology and ideas that help society as a whole.  Special consideration doesn't mean direct investment however.

One lesson learned from this story is that governments are horrible venture capitalists.  This should be expected since unlike VCs, governmental decision makers are betting with someone else's money.  While market development is a solid roll for governments, picking specific winners like VCs try to do, should be left to private investors.

Solyndra couldn't keep up with John Boyd's OODA Loop

One lesson to not learn from this story is that solar energy can't compete with traditional energy and that solar is doomed to failure.  Solyndra failed in most part due to falling prices of solar components and a general inability to keep up with changing business assumptions.  While this was bad news for Solyndra, this is very good news to proponents of clean energy.  Solar energy is on pace to be the least expensive source of electricity for most of the world in a decade.  All this political theater over Solyndra will seem pretty silly when that happens.

"The trend is my friend."
-Old adage of market makers

Idealism doesn't drive sustainable energy development

Northern Iowa Wind Farm - (Going Green In Orange)

A recent article on Renewable Energy World asks the question how did the US grow an energy consciousness.  I can't say that I agree with the implicit assumption the title makes.  I don't think most Americans really think about energy all that much or how important our current existence is on inexpensive, readily available, easily stored energy.  The United States is blessed (or cursed) with abundant natural resources.  This has clouded our collective long term thinking with respect to energy.  We are able to look at availability of energy on a very short term basis because we've had such a consistent supply of all forms of it for so long.  When was the last time anyone pulled into a gas station and found the filling tanks were empty?  How often do blackouts occur on the power grid? When either of these disruptions happen, big challenges ensue but fortunately they haven't occurred that often.  We get the power we want, when we want it, and it doesn't really cost us that much.

Compare this to energy situation of other countries around the world.  Island nations typically have very limited energy options. Their geographic separation from adjacent countries forces them to generate electricity locally and import petroleum via tanker ship--very costly and risky for their national security.  Japan, the world #2 for installed solar, has also resorted to massive reliance on nuclear which is now showing it's flaws in the most catastrophic way possible.  Faced with limited options, people take risks that they otherwise may not have taken.

Island of renewable energy (Michaelis Energy Island)

Germany is another story as well.  As the global leader in renewable energy development with 17% of its electric power capacity coming from renewables, outsiders may think that the Germans have a particularly strong commitment to clean energy.  While environmental reasons are now one of the arguments that Germans make for continuing their current energy policy, national security issues regarding supply of natural gas were the real spark for their dramatic shift towards wind and solar.  Since the fall of the Soviet Union, Russian natural gas companies have periodically played games with the supply of natural gas flowing to western Europe.  The spark that woke up the German populace was a disruption of gas during the peak heating season over the winter of 1992-93.  Cold homes in the winter are a strong motivating force for spending more on local energy.

The main message that Americans have heard regarding renewable energy is that it's good for the environment.  This is an idealistic message that has been both polarizing and lacking in teeth to drive tangible action by even those who believe the message.  Many people immediately think Quixotic farce when they hear anything about solar or wind development--overly idealistic and impractical.  Focusing on the environmental component to renewable energy makes this a political discussion where there are perceived good guys and bad guys.  We also get a lot less personal satisfaction from an effort to conserve energy while a neighbor continues to be profligate with his consumption and waste.  Our environmental savings are easily erased by people not of the same mindset.  None of this serves the purpose of a steady state energy system where we all have access to reasonably priced energy without the negative externalities of fossil fuels.

My read on the US energy situation is that we have about 10 years or so to make some dramatic changes in our mix of energy options to avoid disruption issues that other countries have already had.  10 years is a long time in the sense that we could (and probably will) chose to continue procrastinating on making the spending decisions that we need to make.  10 years is a short time in the sense that the capital improvements we need to make could take that much time or longer to actually complete.

The RE World article I reference above makes the case that governmental policy has been the most effective change mechanism in the US.  Maybe so but our current energy mix has very little renewable energy in it other than hydroelectric.  I honestly can't tell what the spark will be to awaken the sleeping giant once again and unite our efforts behind a common cause.  Hopefully, it will be something much less dramatic than Pearl Harbor was.

The worst kind of wake up call

- Let's use our brains people and get ahead of these very foreseeable future energy challenges.