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Energy Efficiency Versus Renewables: The Great Green Debate

With the recent surge in money going towards renewable energy research and implementation, many people are forgetting a key factor in reducing our impact on the environment: energy efficiency.

Utilizing renewable energy in your home or commercial building is great, don’t get me wrong, but before this expensive option is employed, you should first look at the efficiency of your home or building’s energy systems.

If your building wastes energy, you should prioritize improving this aspect and use the money that you had set aside for a renewable project to accomplish the task.

Once you have collected enough savings from the efficiency retrofits, you can look to implement a renewable energy generation system. By following this succession your system can be sized accurately, and your benefit to the environment, the ultimate goal of all these measures, will be significantly better.

Benefits of Energy Efficiency

In the United States, buildings use 72 percent of electricity consumption, 39 percent of energy use, and produce 38 percent of all carbon dioxide emissions.

If we, as a nation, are looking to decrease our C02 emissions and conserve energy and electricity, we should look no further than the existing buildings in our country.

Recently, as new construction projects have been on the decline, the opportunity to retrofit existing buildings has been increasing. There is vast potential for energy savings in these buildings, which makes them prime project candidates.

A study done by a Lawrence Berkeley National Laboratory scientist claimed that commissioning all of the nation’s commercial buildings would yield the greatest energy savings per dollar spent of any option, including wind and solar energy production. Commissioning involves fine tuning a building’s existing energy systems to improve performance and eliminate wasteful energy use.

After commissioning the building, and saving tons of CO2, energy and money, you can determine what systems need retrofitting.

The fact that commissioning alone has the potential to save the most energy per dollar spent just shows the prospective savings that upgrading a building’s energy systems would create. In the near future, all existing building upgrades should be green focused, as it not only makes environmental sense but economic sense as well.

The same Lawrence Berkeley study claims that $30 billion dollars in energy costs and 300 million tons of greenhouse gas emissions can be saved a year by existing building retrofit projects with paybacks of one year or less.


Let’s be honest, renewable generation doesn’t always make economic sense. This is why federal, state and local municipalities have set up generous rebate and tax credit systems to offset the costs. Even with these savings measures, many solar and wind projects have long paybacks.

Take San Francisco, for example. On top of the 30 percent federal solar rebate and the California Solar Initiative rebate (currently at $1.10 per watt for commercial and residential solar installations), San Francisco offers a $1,500 rebate per kilowatt up to 10 kilowatts.

With all of these rebates you are still looking at 10 to 15 years or more to recoup initial costs. Ten years is not bad, but compare this to energy efficiency retrofit projects, which typically have paybacks of one to five years and produce significant energy and cost savings, and it doesn’t seem to make monetary sense to choose solar installation first.

What does make sense is to evaluate and implement efficient upgrades into your building or home and then look to install renewable energy generation down the line. That way, when you do implement the photovoltaic cells or wind turbine they can be smaller, less ambitious projects that still produce the same percentage of your buildings energy use as was initially desired.

If you use 30 percent less energy after the retrofits, you can make the renewable installation 30 percent smaller.


There has been some success in getting government money to the energy efficiency sector. On September 14 the Department of Energy announced that it would allocate $454 million from the stimulus bill to a new program called “Retrofit Ramp-up.”

The initiative will save $100 million dollars a year in energy savings, according to the Department of Energy. It’s initially focused on whole-neighborhood efficiency retrofit programs that will produce significant cost effective solutions, especially ones that incorporate both public and private buildings.

The department’s hope is that these projects will provide successful sustainable business models for the rest of the country to follow.

The program provides funds to states, U.S. territories, counties, cities and Indian tribes to improve energy efficiency in the building and transportation sector. These entities have to fill out documentation explaining their project and how it will improve efficiency in their community. The applications are then reviewed by the Department of Energy and accepted or declined based upon the merits and potential energy savings of the project.

This is one of several programs funded by the stimulus bill that can be applied to energy efficiency retrofits. There is also a specific appliance upgrade program for residences that is quite comprehensive.

The future

The future seems extremely promising for all the green industries as many policy makers are starting to jump on the sustainable bandwagon. My hope is that the energy efficiency sector does not get overlooked. It may not be as flashy or exciting as renewable energy production but it is equally important. It is also a great place to start improving our eco-friendly practices and it is where money should begin funneling to first.

Once improvements are made in this sector it will be easier to move forward with renewable energy generation, especially small-scale on-site generation. As many buildings start to follow this model, the public will see renewable energy as a more viable and inexpensive solution to our current environmental situation.

In addition to energy savings, the energy efficiency sector has the potential to create a huge number of jobs. At a time when unemployment is rising above 10 percent in many states, job creation is exactly what our country needs. Estimates are that the existing building retrofits market is likely to be a $400 billion dollar industry, and it only makes sense.

Wouldn’t you move forward quickly with a project if you knew it would pay for itself in five years or less? Considering a huge portion of the existing 5 million commercial buildings in the United States could undergo retrofit projects and each project would employ construction workers, engineers, architects, project managers and planners, this industry alone could ignite job growth nationwide.

In light of the recent CO2 reduction benchmarks that are being pushed by President Obama (which will hopefully be more robust after the Copenhagen Conference), we need to act now. If the future of energy production is rooted in the success of renewable generation, the means to get to that end is energy efficiency retrofits.

[photo credit: Flickr]

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2 comments on “Energy Efficiency Versus Renewables: The Great Green Debate

Naga Sekhar Katiki

A great thought provoking article.

However, energy efficiency and renewables are not competing projects but could be complementary. A reduced load on account of energy efficiency measures would make renewable projects more affordable.

Well done! Let’s face it, the savings (dollars and electricity) that can be had from enhanced energy efficiency is not all that “sexy,” but they are real. One can only hope that a post such as this will help raise awareness about how effective improved energy efficiency is in curbing greenhouse gases while stimulating the economy at the same time.

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