Renewable and Efficient Energy: Pathways to a Better Future May 19, 2009 Sophia, Bulgaria Brian T. Castelli Executive Vice...
<ul><li>Current Energy Situation </li></ul><ul><ul><li>Security </li></ul></ul><ul><ul><li>Climate Change </li></ul></ul><...
Features of the  Current Energy Market <ul><li>Tight Supplies </li></ul><ul><li>Growing Demand </li></ul><ul><li>Limited S...
Global Energy Consumption Source: EIA /IEO 2007  &    Frank Verrastro, CSIS Liquids Natural Gas Coal Nuclear Hydro/Renewab...
Geopolitical Concerns Abound Russia Policy US   Refinery Bottlenecks Europe Gas Supplies Europe Oil Supplies Iran Nuclear ...
Climate Change !
Imperatives for Energy Efficiency: Energy Use is a Global Climate Issue Source: Energy Information Administration
CO 2  Emissions - 450 Stabilisation Case By 2030, emissions are reduced to some 23 Gt,  a reduction of 19 Gt compared with...
So, Where Are We???? <ul><li>Facing Simultaneous Challenges of: </li></ul><ul><li>Poverty/Equity, </li></ul><ul><li>Climat...
<ul><li>As an energy resource, efficiency is: </li></ul><ul><li>CHEAPER </li></ul><ul><ul><li>Each $1 invested in Energy S...
Globally, EE is One Possible Means to Contain Demand
Energy Efficiency at the Nexus Source: Frank Verrastro, CSIS Economic Objectives Environmental Objectives Security & Forei...
Plenty of Opportunity for  Improving Energy Intensity Source: Frank Verrastro, CSIS
Energy Efficiency: Powering the U.S. Economy for 30 Years
Huge EE Potential Remains 40%   Energy Efficiency Adapted from McKinsey Analysis Energy Efficiency should be fully conside...
<ul><li>• Russia is very  rich  in energy resources and  self-sufficient  in fuels.  Energy sector highly significant in R...
Inefficiencies Strain  Poor Households in Region
<ul><li>2 major EE markets:  </li></ul><ul><li> privately held industrial enterprises </li></ul><ul><li> municipal utili...
<ul><li>Legal reforms attracting some investment: </li></ul><ul><li>•  Private participation now allowed in urban heating ...
<ul><li>1) POLICY </li></ul><ul><ul><ul><li>Legal & regulatory  </li></ul></ul></ul><ul><ul><ul><li>frameworks must be  </...
<ul><li>2) CAPACITY and AWARENESS </li></ul><ul><ul><ul><li>•  Strengthen  national agencies  for: </li></ul></ul></ul><ul...
<ul><li>Purpose:   to provide EE knowledge to municipalities, utilities  </li></ul><ul><li>and housing associations to imp...
<ul><li>Supported creation of  RENEUER  in 1999  ( with Bulgarian Center for EE, EnEffect ) </li></ul><ul><li>•  Regional ...
Contact Us! Brian T. Castelli Executive Vice President [email_address] 202-857-0666 www.ase.org
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U.S. Department of State, Office of International Information Programs Conference: Renewable Energy and Energy Efficiency to Enhance Energy Security

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In his presentation, Castelli addresses The Role of Energy Efficiency in Energy Security and Climate Change. Taking into consideration the global energy concerns and the increasinly volatile geopolitical landscape, there is a great need to improve energy intensity across the world. Energy efficiency - which is at the nexus of economic objectives, energy security & foreign policy objectives, and environmental objectives - offers a great opportunity to achieve this. Castelli discussed the roles that the public and private sectors must play to sieze this potential in Russia and former Soviet Union countries. In this area of the world, he said, energy efficiency can significantly reduce consumer energy consumption, particularly in home heating.

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  • U.S. Department of State, Office of International Information Programs Conference: Renewable Energy and Energy Efficiency to Enhance Energy Security

    1. 1. Renewable and Efficient Energy: Pathways to a Better Future May 19, 2009 Sophia, Bulgaria Brian T. Castelli Executive Vice President Alliance to Save Energy The Role of Energy Efficiency in Energy Security & Climate Change
    2. 2. <ul><li>Current Energy Situation </li></ul><ul><ul><li>Security </li></ul></ul><ul><ul><li>Climate Change </li></ul></ul><ul><li>Energy Efficiency’s Importance & Potential </li></ul><ul><li>The Challenges of Energy Efficiency in the Region </li></ul><ul><li>Private Sector Role in Energy Efficiency </li></ul><ul><li>Overcoming Barriers to Energy Efficiency </li></ul><ul><li>Alliance work in the region </li></ul>Presentation Outline
    3. 3. Features of the Current Energy Market <ul><li>Tight Supplies </li></ul><ul><li>Growing Demand </li></ul><ul><li>Limited Spare Capacity </li></ul><ul><li>Heightened Geopolitical and Investment risk </li></ul><ul><li>Higher Prices </li></ul><ul><li>Climate Concerns </li></ul>… an UNSUSTAINABLE TRACK CLIFF AHEAD (sorry) Source: Frank Verrastro, CSIS
    4. 4. Global Energy Consumption Source: EIA /IEO 2007 & Frank Verrastro, CSIS Liquids Natural Gas Coal Nuclear Hydro/Renewables 23% 7% 26% 38% 6% 2005: 447 Quad Btu 24% 34% 28% 8% 6% 2030: 702 Quad Btu
    5. 5. Geopolitical Concerns Abound Russia Policy US Refinery Bottlenecks Europe Gas Supplies Europe Oil Supplies Iran Nuclear Ambition Iraq: Sabotage Nigeria Civil Unrest Latin America Resource Nationalism N-Korea Nuclear Ambition US Hurricanes China Demand increase Strait of Malacca Piracy Pakistan Political Turmoil Source: Frank Verrastro, CSIS
    6. 6. Climate Change !
    7. 7. Imperatives for Energy Efficiency: Energy Use is a Global Climate Issue Source: Energy Information Administration
    8. 8. CO 2 Emissions - 450 Stabilisation Case By 2030, emissions are reduced to some 23 Gt, a reduction of 19 Gt compared with the Reference Scenario Source: IEA World Energy Outlook 2007 & Frank Verrastro 10 15 20 25 30 35 40 45 2005 2010 2015 2020 2025 2030 Gt of CO 2 CCS in industry CCS in power generation Nuclear Renewables Switching from coal to gas End Use electricity efficiency End Use fuel efficiency Reference Scenario 450 Stabilisation Case 27 Gt 42 Gt 23 Gt Energy-Related CO 2 Emissions
    9. 9. So, Where Are We???? <ul><li>Facing Simultaneous Challenges of: </li></ul><ul><li>Poverty/Equity, </li></ul><ul><li>Climate Change with New Players, </li></ul><ul><li>New Alignments, </li></ul><ul><li>New Rules, and </li></ul><ul><li>Outmoded Institutions </li></ul>
    10. 10. <ul><li>As an energy resource, efficiency is: </li></ul><ul><li>CHEAPER </li></ul><ul><ul><li>Each $1 invested in Energy Star program = $75 in energy cost savings and $15 of investment in new efficiency technologies </li></ul></ul><ul><li>QUICKER </li></ul><ul><ul><li>In 2001, California cut peak electricity use by 10% in less than a year </li></ul></ul><ul><li>CLEANER </li></ul><ul><ul><li>“ Negawatts” produce NO ENVIRONMENTAL FOOTPRINT </li></ul></ul><ul><li>MORE SECURE </li></ul><ul><ul><li>A “homegrown” resource! </li></ul></ul>Why Energy Efficiency?
    11. 11. Globally, EE is One Possible Means to Contain Demand
    12. 12. Energy Efficiency at the Nexus Source: Frank Verrastro, CSIS Economic Objectives Environmental Objectives Security & Foreign Policy Objectives Energy Efficiency Renewable Energy Nuclear Oil Coal Natural Gas Carbon Capture and Storage Affordable/Accessible Promotes/Supports Economic Growth & Employment Environmentally Benign Low/no emissions Promotes/Supports Sustainable Environment Defensible Reliable and Secure
    13. 13. Plenty of Opportunity for Improving Energy Intensity Source: Frank Verrastro, CSIS
    14. 14. Energy Efficiency: Powering the U.S. Economy for 30 Years
    15. 15. Huge EE Potential Remains 40% Energy Efficiency Adapted from McKinsey Analysis Energy Efficiency should be fully considered in GHG reductions. All items to the left of the arrow represent “negative marginal costs”
    16. 16. <ul><li>• Russia is very rich in energy resources and self-sufficient in fuels. Energy sector highly significant in Russian economy. </li></ul><ul><li>Very high Energy Intensity (energy needed to produce per unit of GDP) in Russia and many FSU countries. </li></ul><ul><li>• Supplying HEAT accounts for about 45% of all domestic energy use; close to 50% of fossil fuel use . </li></ul><ul><li>• Potential estimated at 45% of </li></ul><ul><li>current consumption. </li></ul>Huge Potential for Energy Efficiency Source: Wall Street Journal, 8 May 2006
    17. 17. Inefficiencies Strain Poor Households in Region
    18. 18. <ul><li>2 major EE markets: </li></ul><ul><li> privately held industrial enterprises </li></ul><ul><li> municipal utilities and housing. </li></ul><ul><li>District heating, formerly fully municipal, has a growing share </li></ul><ul><li>of private ownership through leasing or privatization . </li></ul><ul><li>Private sector provides: </li></ul><ul><ul><li> equity for investments </li></ul></ul><ul><ul><li> energy-saving goods and services. </li></ul></ul><ul><li>Private sector in financing : </li></ul><ul><li>• ESCOs, public-private partnerships, third party financing </li></ul><ul><li>• Proven effective for utility infrastructure but seldom applied. </li></ul><ul><li>• Negotiations to create ESCOs and use performance contracting </li></ul><ul><li>were especially slow and difficult. </li></ul>Private Sector Role in EE in the FSU
    19. 19. <ul><li>Legal reforms attracting some investment: </li></ul><ul><li>• Private participation now allowed in urban heating </li></ul><ul><li>• Gradual privatization and elimination of subsidies </li></ul><ul><li>• Prices expected to rise over time to cost-recovery levels </li></ul><ul><li>When done properly: </li></ul><ul><ul><li> More effective management </li></ul></ul><ul><li> Transparent accounting </li></ul><ul><li> Improved customer service & QC </li></ul><ul><li>But a common pitfall in FSU countries: </li></ul><ul><li>• CHPs privatized, DH remained municipal, & municipal </li></ul><ul><li>facilities given priority in sales </li></ul><ul><li>• RESULT: private CHPs failed </li></ul><ul><li>(under-loaded, therefore less efficient and higher priced) </li></ul>Environment for Private Sector is Improving
    20. 20. <ul><li>1) POLICY </li></ul><ul><ul><ul><li>Legal & regulatory </li></ul></ul></ul><ul><ul><ul><li>frameworks must be </li></ul></ul></ul><ul><ul><ul><li>improved… </li></ul></ul></ul><ul><ul><ul><li> Create incentives for </li></ul></ul></ul><ul><ul><ul><li>promoting energy efficiency </li></ul></ul></ul><ul><ul><ul><li> Open the energy sector to private participation </li></ul></ul></ul><ul><ul><ul><li> Promote metering and DSM measures </li></ul></ul></ul><ul><ul><ul><li> Eliminate subsidie s </li></ul></ul></ul><ul><ul><ul><li>~ Energy tariffs should recover costs ~ </li></ul></ul></ul><ul><ul><ul><li> Modernize energy standards & technical regulations </li></ul></ul></ul><ul><ul><ul><li> Promote energy efficiency services market </li></ul></ul></ul>Overcoming Barriers to EE in the Region
    21. 21. <ul><li>2) CAPACITY and AWARENESS </li></ul><ul><ul><ul><li>• Strengthen national agencies for: </li></ul></ul></ul><ul><ul><ul><li> setting energy efficiency targets </li></ul></ul></ul><ul><ul><ul><li> developing programs </li></ul></ul></ul><ul><ul><ul><li> ensuring implementation </li></ul></ul></ul><ul><ul><ul><li>• Train energy managers and auditors </li></ul></ul></ul><ul><ul><ul><li>• Cultivate partnerships among: </li></ul></ul></ul><ul><ul><ul><li>energy consumers, service providers, financiers </li></ul></ul></ul><ul><ul><ul><li>• Provide Information : test EE models, document case </li></ul></ul></ul><ul><ul><ul><li>studies, prepare guidelines, advocate. </li></ul></ul></ul><ul><ul><li>3) FINANCING - Need mechanisms, such as… </li></ul></ul><ul><ul><ul><li> loan funds  vendor credits  leasing </li></ul></ul></ul><ul><ul><ul><li> credit guarantees  carbon finance </li></ul></ul></ul>Overcoming Barriers to EE in the Region, cont.
    22. 22. <ul><li>Purpose: to provide EE knowledge to municipalities, utilities </li></ul><ul><li>and housing associations to improve heating and water supply </li></ul><ul><li>Scope: 17 countries in Eastern Europe and FSU </li></ul><ul><li>Vehicle: dissemination through web site and events. </li></ul><ul><li>Topics: </li></ul><ul><ul><ul><li> project financing </li></ul></ul></ul><ul><ul><ul><li> public awareness campaigns </li></ul></ul></ul><ul><ul><ul><li> municipal planning, but mainly… </li></ul></ul></ul><ul><ul><ul><li> POLICY REFORM - improving & creating laws to promote EE </li></ul></ul></ul><ul><li>Our Most Recent MUNEE Work: </li></ul><ul><li>In-depth assessments of policies, programs and key issues on </li></ul><ul><li>1) urban residential heating </li></ul><ul><li>2) the impact of EE on ability of poor to afford heating </li></ul>Municipal Network for EE: MUNEE (http://www.ase.org/section/program/munee/)
    23. 23. <ul><li>Supported creation of RENEUER in 1999 ( with Bulgarian Center for EE, EnEffect ) </li></ul><ul><li>• Regional Network for Efficient Use of Energy & Water Resources </li></ul><ul><li>for Southeastern Europe </li></ul><ul><li>• Albania • Bosnia-Herzegovina • Bulgaria • Croatia </li></ul><ul><li>• FYR Macedonia • Moldova • Romania • Serbia & Montenegro </li></ul>Alliance in Southeastern Europe Common state of windows in CIS countries Gabrovo, Bulgaria
    24. 24. Contact Us! Brian T. Castelli Executive Vice President [email_address] 202-857-0666 www.ase.org

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