Home Efficiency Is About the Grid, Not Your Utility Bill
To decarbonize our grid over the next century, we know that we must deploy renewables at an aggressive rate. But this is just step one. Subsequent steps can take several forms. Some routes will be harder, some will be easier. If we hope to take that easier route, the key is to take a step back and bring energy demand into our equation. To put it simply, the key to arriving at a decarbonized grid as quickly and cheaply as possible is focusing on our buildings.
A well-planned decarbonized grid focuses on demand as well as supply. Supply involves the impact of our energy and the logistics that are involved with renewable generation. Demand involves how effectively we can use this energy.
We love talking about supply. Supply is magnetic. Pictures of landscapes blanketed with solar arrays and dotted with wind farms instill that technocratic hope that we can visualize. Demand on the other hand doesn’t have that “it” factor. Insulation and air barriers? Yikes. The sleekest thing we have going for us are heat pumps, which is pretty indicative of how square efficiency seems to the public.
As a result, demand has been pushed to the edge of the conversation. And energy efficiency has had to frame itself in other ways. Worse ways. We talk about the homeowner. The lower utility bills, the reduction in personal footprint, and the increased comfort. All these benefits are real and even if they were the only benefits, stricter building codes and deep retrofits would still be worth it. But efficiency does so much more than just this. And these other benefits pale in comparison to its essential role in transforming society’s energy consumption.
Because demand has lost its allure, its critical role in the renewable energy landscape has been forgotten. We have slipped into a rhythm in which we think that once we tackle supply, demand will be a non-issue. We tell ourselves, if all power will come from renewables, who cares if we are consuming our current level of 6.3 trillion kWh of electricity each year, or 100 times this? The energy is carbon neutral after all.
The reality is, consumption matters if we want to decarbonize completely, quickly, and cheaply. Demand-side solutions allow for easier scaling of renewables, are essential for electrification, and reduce the logistics of renewable intermittency.
Fully decarbonizing our electricity sector means scaling up renewable generation from our current rate of 15 percent to 100 percent. Increasing deployment is already a challenge given our current levels of demand. However, the goal is not to decarbonize our current energy demand. Instead, the plan is to begin working today in order to decarbonize the energy demand needed in a quarter century from now. This means between now and then, our target will be moving and the prospect of decarbonization will be more challenging in 2050 than it is today.
Our economy and population are projected to grow. This means our building sector will also grow. Buildings currently consume 40 percent of the nation’s total energy and use more than 70 percent of the electrical energy. Our housing stock alone is projected to increase from 205 billion square feet to 296 billion square feet by 2050.
If we chose to neglect efficiency measures, we will have to scale up production of renewables to meet this 50 percent housing increase. Meeting this demand without focusing on efficiency means deploying more gigawatts of renewables. This means an increase in land acquisitions, generation equipment, power lines, grid infrastructure, and maintenance. These complications can add billions of dollars to the equation of decarbonizing.
Ok. So, the need to increase deployment if we choose to neglect efficiency measures may be an expensive headache, but it doesn’t make deployment impossible. However, when we turn to our “electrify everything” conversation, the reality changes.
Electrify everything is a two-pronged approach that has become an industry standard. Decarbonization involves generating all electricity through renewables and replacing everything with electrically powered technology. However, our inefficient building stock is stuck in the age of fossil fuels, and our two most energy-intensive home appliances, space and water heaters still rely on onsite fuel oil and natural gas.
Focusing on efficiency prompts electrification. Electric heat pumps, which were not too long ago a total joke are now changing the landscape of home efficiency and can be installed from coast to coast at all latitudes. These appliances reign supreme in the great efficiency race, operating at 400 percent higher efficiency compared to their conventional fossil fuel powered counterparts. Extensive modeling done by NREL analyzed nationwide energy savings of transitioning from conventional space and water heating equipment to heat pump powered equipment. Looking at total technical potential, a heat pump transition would not only increase efficiency, but replace fossil fuel equipment, reducing onsite fuel combustion by over 1,600 TBtu each year. To put this in perspective, this savings measure is equivalent to the energy consumed by the commercial based aviation sector each year.
Efficiency will be critical for scale and for fuel switching but more than just these benefits, focusing on demand offers a solution for renewable naysayers. The popular critique of renewables is that the sun is not always shining, and the wind is not always blowing, making the idea of a 100 percent renewable grid ludicrous given the current technology. These concerns are warranted. Intermittency is a legitimate problem that renewables pose.
For the grid to function properly, electricity supply must match demand. When electricity demand is at its highest, typically in the evening, the grid must be designed to match this peak in order to avoid blackouts. If too much electricity is on the grid at a given time, overgeneration issues arise and solar is shut off. Shutting off usable solar means wasting energy that we spent money on to acquire land, operate systems, build grid infrastructure, and maintain. In other words, over generation makes renewable energy uneconomical.
You can see this problem arise in California with an increased deployment of solar. This duck curve shows that to meet a high evening demand when everyone goes home to their houses and when solar productivity is fading, we would have to deploy a ton of panels. However, in the afternoon, when demand is relatively low and supply is peaking, net generation, the amount of energy needed minus the amount available, will be far too low, resulting in over generation issues.
There are a few ways to solve this problem. The first would be deploying non-renewable sources that are not intermittent such as coal or gas to offset peak hours. This is not a great solution if we hope to reach our goal of 100 percent renewables. The next solution is energy storage. This can be in the form of pumped hydro, batteries, or other less talked about methods such as flywheels or compressed air. Pumped hydro is age-old, and other technologies such as batteries are getting cheaper and more effective each year. Storage is undergoing a renaissance. It shows a ton of promise and will become a larger part of our grid in years to come. But this does not change the fact that building efficiency remains the cheapest and most effective way to deal with demand.
Efficiency reduces the severity of this duck curve and other intermittency issues in two major ways. One, more efficient buildings need less energy. This means that if we are transitioning to a grid powered by renewables, we don’t have such a steep scale of electricity production each evening. This means that in California during the middle of the day, the grid doesn’t have to deal with an enormous amount of excess energy and in the night when solar isn’t productive, fewer batteries and other storage devices must kick in because efficient buildings will demand less energy to function.
Energy efficient buildings don’t just consume less energy. These buildings and appliances are designed with smarter systems and automated functions that can respond to a new grid that will have peaks and troughs of available energy supplied by intermittent renewables. These built-in features are known as demand response systems and are gaining prevalence fast. Built into heat pumps, refrigerators, and electrical boxes, these systems deliberately choose when to draw electricity from the grid based on its price, abundance, and fuel mix. Efficiency will not only provide softer demand, but it will also provide more flexible demand.
Of course, home efficiency is just one path that we could take. But the data provided by the International Renewable Energy Agency on efficiency makes it an enticing path. By focusing solely on renewable energy, in 2050, U.S. carbon emissions would be reduced by 32% compared a business as usual case. By deploying efficiency related technologies in conjunction with renewables, carbon emissions would be reduced by 44% saving an additional 4 Gt of CO2 each year.
Choosing this route not only allows for greater savings but enables us to get more bang for our buck. Looking only at direct costs of deployment, we would save 45 billion dollars per year compared to employing solely renewable energy measures. When accounting for the costs related to human health and emissions, savings become 95-160% higher, saving hundreds of billions of dollars.
Building efficiency is reworking how our grid functions. Our conception of the grid has been a vertically integrated system that ramps up or down the electrical supply to meet a rigid demand. Trying to fit this old fossil fuel based grid model into an emerging renewable system will require far more planning, resources, money, and time. Unfortunately, climate change is here, and we don’t have that luxury.
Each year there are more technological solutions that will help us decarbonize effectively. The key is choosing the right path. A well-insulated building may not have the same glamour that a solar array has, but building efficiency is much more than that. Building efficiency is our key to smart consumption on a collective level. It is the other hand of our decarbonization strategy that must work in concert with energy supply.
