Limits to energy conservation analysis

Communications on energy Limits to energy conservation analysis After the 1973 crisis energy conservation was heralded as an immediate and economic solution to the oil problem. There seem to be good reasons for this: its potential appears large, many conservation measures use established techniques; and the effects on the environment, if any, are mostly beneficial. But, asks Clas-Otto Wene, what has been accomplished? Many papers on conservation have been written but so far the ~=ffect on the energy balance seems to have been minute. Has energy conservation been oversold? In his editorial comment in the D e c e m b e r 1979 issue of Energy Policy, 'Limits to energy policy analysis',' Alvin Weinberg asserts that energy conservation as an energy strategy has been 'oversold'. The focus is, however, not on the past but on the future. He raises the question of how far energy policy should be based on 'decidable propositions' containing policy goals that can be reached through a short series of decisions, and thus have a large chance of being realized. On the supply side there exists an established infrastructure consisting of organizations with well defined objectives and routines for decision making. On the d e m a n d side there are millions of consumers with conflicting goals and limited capacity for obtaining and evaluating information. Supply goals

are therefore to a much higher degree based on 'decidable propositions' than goals for conservation on the demand side. The obvious conclusion is that the 'intrinsic' uncertainties that seem to be inherent in demand management make conservation a very risky and difficult national energy policy issue. It could be a d d e d that the poor performance of conservation verifies this. It seems, therefore, that energy policy analysts have, by and large, overestimated the impact of energy conservation.

Resolving conservation uncertainties

However, are the uncertainties in d e m a n d management really 'intrinsic'? Is it not possible to resolve the uncertainties so that goals for conservation can be based on 'decidable proposiImplemen-. ~ tions'? Have the analysts been looking ftation ~ at the energy system in a much too Orcjanisational Data narrow way? structure collection Figure 1 illustrates this last point. It shows the steps involved in a purposive change in the energy system, eg the implementation of a new energy techEducation System nology. Data on energy demand, and troininq = analysis estimated or observed cost and performance of competing energy tech~',-.~ DecisionJ onpolicy nologies and carriers (data collection) form input to the system analysis. The Figure 1. Schematic model showing the results of the analysis form a basis for steps involved in a purposive change in the the decisions of the policy maker. Two energy system. steps have to be taken before a

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decision, for example about a new technology, can be implemented. A n education and training programme has to be launched and the effects of the organizational structure have to be determined. 2 The latter involve both changes in existing organizations or creating of new organizations as well as interactions between different organizations, for instance to obtain concessions, and between organizations and the market. The effects of the implementation are followed up by renewed data collection. There are many feedback loops between the steps, but only two loops which are of importance here, are indicated in Figure 1. For the sake of simplicity, R D & D are not indicated in the figure. They may enter as givers or takers at each step, and are major forces keeping the wheel moving.

Bias towards supply The type of energy modelling and energy policy analysis Weinberg refers to deals exclusively with the right-hand side of the f i g u r e - without the two feedback loops indicated in the figure. For a new supply technology the effects of the left-hand side of the diagram may, at least as a first approximation, be simulated by a delay or lead time. The educational institutions can rely on a long tradition in teaching supply technologies. For example, university courses on nuclear power were already available in many countries in the 1950s. Well equipped organizations to build, use and control the supply of technologies already exist and so do the rules regulating the interplay between these organizations and their market. The position is radically different for conservation involving demand technologies. The traditional educational institutes have no experience in teaching energy demand management in the systematic way necessary. The universities and the technological institutes, who would be expected to be in the forefront, have mostly failed to educate students that could play a leading role in energy management inside industries and communities. One reason for this failure could be the interdisciplinary approach necessary, 47

Communications involving curricula from both the hard and soft sciences. As an example it should be noted that, in spite of the strong political commitment to conservation in Sweden, full semester courses at university level on demand management are only available in two places, Gothenburg and J6nk6ping. With a few exceptions, steel and paper mills probably being the most notable ones, the organizations for energy management within the demand areas have been built up after 1973. There is still little experience on how such organizations are made efficient. In industry, should energy management be a staff responsibility, a branch under the production manager or an independent branch? In the residential and commercial areas, how is market transparency increased? Who is best equipped to promote conservation? The communities? The energy companies? On the national level what type of incentives can be used to further the implementation of conservation technologies? This list of questions is by no means exhaustive. It illustrates, however, that problems which for the supply technologies have painstakingly been solved over the last half

century

are

just

now

being

discussed for the demand technologies. There are two conclusions and a corollary to be drawn from the above discussion.

the political attitude towards 'undecidable propositions'. This sounds like giving up before getting started. The energy policy analyst has not only to consider the effects of the existing educational and organizational constraints on the cost and performance of energy conservation, but must also ask how the educational and organizational infrastructure may be changed to effectively promote conservation and what the cost to the society of these changes will be. For example, what are the lead times, costs and benefits of launching a large training programme for retrofitting of old houses or building a large decentralized organization for energy consultancy in smaller industry? The study of questions of this sort will reveal how, and at what costs, the uncertainties regarding demand management can be resolved, and will make it possible to let supply and conservation compete on equal footing

for a common objective. Important insights can probably be obtained from local studies, for example computeraided analysis of supply and demand in a community or an individual industry. A corollary of the above arguments is that the new decentralized supply technologies may run into the same obstacles as conservation. An analysis of their future demands on the educational and organizational infrastructure will help to avoid surprises.

C/as-Otto Wene Department of Nuclear Physics Lund Institute of Technology Lund, Sweden

'A. Weinberg, 'Limits to energy policy analysis', Energy Policy, Vol 7, No 4, December 1979, p 274. 2For a discussion on the effects of the organizational/institutional structure on the formulation and the implementation of energy policies see, for example, M LSnnroth, T.B. Johansson and P. Steen, SolarversusNuclear- ChoosingEnergy Futures,Pergamon, Oxford, 1980.

Energy savings from the Minnesota low-income weatherization programme

The 26 local Community Action Agencies in Minnesota administer a federal programme to audit and retrofit homes occupied by low-income households. This programme aims to improve the thermal performance of these homes and so reduce the economic hardship faced by these households because of high The lead time and rising fuel prices. A key question concems the actual energy savings that Conservation fitted into the educa- can be attributed to the programme. The work reported here involved collection tional and organizational infrastructure and analysis of fuel consumption records from low-income households of the 1970s as well as a square peg fits throughout Minnesota. Data were obtained from 59 households that had into a round hole. In estimating the received weatherization services and from 37 households that were eligible for lead times for conservation the assistance but had not yet been weatherized. Comparisons of fuel consumption emphasis had been on material flows across the two groups for the 1976-77 and 1977-78 winters showed that the and capital turnover times. However, average saving due to weatherization was 13% of total household energy use. the lead times depend very strongly on Based on fuel prices that prevailed in 1979, the cost of weatherization is likely to the delays in the information trans- be repaid with lower fuel bills in 3-4 years. mitters in the left-hand part of Figure 1. This explains the poor performance of conservation during the 1970s. The federal Weatherization Assistance for low-income persons, especially the Program was initiated by the Commun- elderly and handicapped. 4 Beginning in ity Services Administration (CSA) in 1977, the CSA programme was phased System analysis January 1975, under CSA's Emergency out; low-income weatherization fundA complete analysis of energy conser- Energy Conservation Service,' ing now comes entirely from DOE. vation must involve the whole cycle in Subsequent legislation2,3 directed the From their inception, the CSA and the diagram. Weinberg suggests a new US Department of Energy (DOE) to D O E weatherization programmes term in the objective functions of our establish a federally financed National have been plagued with problems. linear programming models to capture Weatherization Assistance Program These relate primarily to labour, co-

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