Saving the World, One Light Bulb at a Time Why Conservation Is the World's Best Energy Source

Warnings of a coming climate catastrophe caused by greenhouse gas emissions are growing louder. But the pressure for economic growth around the globe is pushing gas and oil prices higher. The solution seems deceptively simple: conserve energy by using it more efficiently. So why aren't more people doing exactly that?
A satellite image of Europe at night: Residents of Western Europe's industrial nations waste enormous amunts of electricity, petrol, heating oil and gas. Without any noticeable decrease in quality of life, consumers could reduce their energy consumption by one-fifth.

A satellite image of Europe at night: Residents of Western Europe's industrial nations waste enormous amunts of electricity, petrol, heating oil and gas. Without any noticeable decrease in quality of life, consumers could reduce their energy consumption by one-fifth.

Foto: AP/ NASA

Peter Lentz always starts his hunt for wastefulness in the cellar. That’s where the energy expert hits pay dirt on this particular morning too: He feels it as soon as he walks into the boiler room. It’s too warm down here.

The thermometer shows 29 degrees Celsius (84.2 degrees Fahrenheit). The apartment building has two boilers supplying its heat. Both are running even though it’s above freezing outside. “One would be more than enough,” says Lentz. But what really stuns the energy specialist is the fact that each unit has a water capacity of 2,500 liters (660.4 gallons), which he considers “absolute nonsense.”

Lentz directs WGB Wärme GmbH, a Berlin-based company with a unique business model. His firm turns a profit by saving energy for its clients. WGB installs modern heating systems that can be controlled from its service center. Clients agree to buy oil or gas from the firm for a set period of time, say ten years, but do not pay a cent for the equipment. Instead, WGB finances the new heating systems from the energy savings it provides.

The deal pays off for both client and contractor -- and helps the environment at the same time. Energy savings average between 15 and 20 percent, but are often even more. The clever concept is becoming quite popular in Germany; there are already some 500 energy contractors like WGB providing services to real estate companies, supermarkets and even prisons. And their market share is growing by about 15 percent each year.

The conservation industry

Conserving energy is rapidly becoming a growth sector. The new industry is creating thousands of jobs in areas where German firms are already leaders. Who would have thought 20 years ago that modern technology for wind and solar energy would eventually become an export hit? Or that shares in these companies would be traded on the stock market?

With humanity wasting massive amounts of oil, gas and coal to heat buildings, power industry and fuel vehicles, the potential for conservation efforts is vast. Fossil fuel consumption has increased by two-thirds within a generation. Rapidly growing economies in Asia and countries formerly part of the Soviet Union have increased the global competition for resources . The world seems to have insatiable appetite for energy these days.

And the future of new economic powerhouses like China and India   depends on a steadily growing global energy supply. But where modern technology falls by the wayside in their rapid development, massive quantities of natural resources are wastefully being burned and pumped into the atmosphere. That makes no sense economically, and it's environmentally insane.

Climate change reports released by the United Nations last week and in February came to rather worrisome conclusions about the state of worldwide greenhouse-gas emissions and global warming. That in part has encouraged leaders of all political persuasions and nationalities to declare themselves ready to make environmental protection a priority. The alarming forecasts even led German Chancellor Angela Merkel to announce: “It’s five minutes till midnight.” But can anything actually be done to turn back the clock?

Asia ascendent

Future superpower China is already the world’s second biggest consumer of oil after the United States, even though the Asian giant is hardly motorized. Only 19 out of 1,000 Chinese drive a car, whereas in America some 780 people out of 1,000 do. And China is second only to the United States when it comes to belching greenhouse gases into the atmosphere.

Hundreds of millions of people want to copy Western standards of living and Western consumer habits -- hurtling their countries toward environmental catastrophes in the process. At the same time citizens of the industrialized world are beginning to fret over the question of how much more the planet can withstand. How can mankind’s monstrous appetite for energy be sated in both Asia and in the West?

In the past, it was enough to simply drill for new oil and gas fields, burn larger amounts of coal and build more nuclear power plants. But these days even enthusiastic growth optimists are pointing out the limits of such a strategy: It’s too expensive, too dangerous, and -- above all -- too dirty.

One reliable source of energy is not even close to being depleted: Simply saving it may be the safest and cleanest option mankind has. It also happens to make a tidy profit.

Potential Savings in Europe of €60 Billion Each Year

Without much effort, the almost 500 million citizens of the European Union could reduce their energy use by one-fifth, studies have found. That would add up to savings of roughly €60 billion ($79 billion) per year. Such huge sums become less abstract when broken down to household level: An average family could save from €200 to €1,000 by using their energy more efficiently.

In this case, less could certainly be more. And it’s not about silly suggestions such as using your coffee filter three times. Saving doesn’t have to mean sacrificing quality of life. An energy-saving compact flourescent light bulb, for example, uses only one-fifth of the energy required by a conventional incandescent bulb and lasts ten times longer. Buying them will “pay off more than most investments,” says Hans Weinreuther from a consumer advocacy association in the German state of Rhineland-Palatinate.

If Europeans switched to innovative lighting technology, they could save €4.3 billion each year which in turn could be used for more important things. But why are consumers so reluctant to take that path?

Leaky pipes and poor insulation

The current debate about energy often seems to be filled with paradoxes. Many Germans are afraid of being too dependent on Russian oil and natural gas, which leads some in this traditionally anti-nuclear nation to reassess their attitudes toward atomic energy . Others are even mention the possibility of increasing domestic coal production. At the same time, the German environmental group BUND has criticized that the most important source of energy “has hardly been tapped at all.”

End consumers use only about a third of all the energy produced worldwide. The rest is wasted -- it disappears into the air or sea through leaky pipes and poor insulation. Peter Hennicke, president of the Wuppertal Institute for Climate, Environment and Energy, compares current energy systems with a bathtub that doesn't have a plug in the drain -- it constantly needs more water. “It’s an intellectual provocation for any creative engineer or planner,” Hennicke says.

Even supposedly fine-tuned products such as automobiles are horrendously inefficient. Around 70 to 80 percent of the power created by the motor does not end up being used for the car’s main purpose: moving forward. Instead the energy heats up the radiator fluid or is blown out the muffler as hot air. Naturally the heat could be used for propulsion; that’s not a new idea. But the technological hurdles to produce such steam-powered automobiles have proven too great -- and gasoline has simply been too affordable to make the effort worthwhile.

Saving energy to secure world supplies

How people use energy -- and the products that require it -- is often a conflicted affair. But every liter of oil, every cubic meter of gas, every kilowatt-hour of power conserved not only saves money and the environment. It also helps secure the world’s energy supplies.

Slowly this realization is spreading. US President George W. Bush recently called on Americans to use less oil since their country’s consumption of petroleum products made the United States “vulnerable to enemy regimes and terrorists.” For the first time, the former Texas oilman admitted that some sort of climate change was underway and that it presented “a serious challenge.”

But the new tune coming from Washington is a rather familiar one in Brussels. The European Commission has already come up with countless action plans, presented studies and pushed ahead with efficiency campaigns. The goal is for the 27 EU members to use at least one percent less energy each year. And the Commission demonstrated just how serious it is about achieving that aim by attempting to tighten emissions standards for the automobile industry.

Of course, the EU commissioner responsible for environmental issues, Stavros Dimas, watered down his original demands. It’s not just the carmakers being held responsible -- gasoline producers are supposed to deliver cleaner-burning and ecologically friendly biofuels . And one of the most important questions remains: Do the new limits apply to the entire automobile industry? Will the same standards be set for Fiat and Porsche? But the EU will no longer be satisfied with lazy promises made by the industry to improve its record. The argument about not wanting to endanger thousands of jobs was specious to begin with. For only those carmakers developing new models -- which will most certainly be cars that use less fuel -- will survive the coming decades, and secure jobs in the process.

Pressure to change

There’s no doubt that something is underway. The growing number of forecasts predicting dramatic changes to the planet’s climate is altering the perceptions of political leaders, corporate managers and even average consumers. It was taken seriously once consumers saw how rising prices for gasoline, heating oil, natural gas and electricity were emptying their pocketbooks. The more financial pressure is applied, apparently, the more people are willing to save.

Energy consultants in Germany are booked out for weeks at a time. Consumer advocacy agencies that provide energy saving tips are busier than ever. New furnaces sell like hotcakes and heating experts can barely install them fast enough. Wood has been rediscovered as a heating source, and remains more affordable than gas despite rising demand for it.

Heating with pellets made from pressed wood scraps is even more affordable. The number of heating units using them in Germany has grown to 70,000 from only 40,000 the year before. Pellets burn evenly, giving them an extremely high energy conversion efficiency of over 90 percent.

Strong demand for energy-efficient items is causing prices to soar. Insulating materials like rock wool, polystyrene, cork or coco fiber panels cost as much as ten percent more than they did last year. Despite the inflated prices, some are still sold out for months at a time, waking memories of a bygone era of energy shocks and a drive to be more efficient.

The Spirit of Saving Is Returning

Saving energy was popular in the 1970s, as surging oil prices changed people’s daily lives. In Germany in 1979, a liter of gasoline cost more than one deutsche mark for the first time ever. The German motor club ADAC distributed millions of stickers with the slogan: “I’m an energy saver.” American physicist Amory Lovins coined the term “negawatts” for unused megawatts to show that saving energy could have an economic impact. His credo explained that economic growth and a reduction of energy use didn’t have to be mutually exclusive.

Both the public and industry made an effort and, sure enough, energy costs sank. Energy intensity -- the relationship between energy use and economic output -- has since dropped by 40 percent. However, as oil prices eventually fell, so too did the interest in saving energy. It’s a lot like people with bad backs -- as soon as the pain is gone, they stop doing their therapeutic exercises.

A generation later, the spirit of saving has returned. And this time it may have more lasting effects, since it has less to do with doing good and more to do with economic sense. Even Germany’s ruling coalition of the conservative Christian Democrats and center-left Social Democrats -- often paralyzed by its efforts to reach a consensus -- is getting in on the act.

Little public awareness of energy consumption

The government has already established its own goals for 2020. Germany should cut its electricity consumption by 8 percent compared to 2003 levels, lower heating for buildings by 19 percent and decrease energy consumption for transportation by 5 percent. That, at least, is what Germany’s Dena energy agency is aiming for, but the path getting there won’t be easy.

The difficulties start with the images associated with saving energy -- which never sounds sexy or exciting. Instead it conjures up ideas of getting by with less or freezing. “Who really likes to save?” asks Dena’s director Stephan Kohler. “I don’t.”

Kohler prefers to talk about efficiency. Of course, that’s his job: Dena was set up by Germany’s last center-left government under Gerhard Schröder's Social Democrats and the Green Party to spread the gospel of energy conservation across the land. And that's one of the toughest hurdles to clear -- far too many people just don’t know much about the energy they use.

Who knows how much their freezer costs them each month? Who is aware that a flight from Europe to America spews some 4,000 kilograms of carbon dioxide into the stratosphere? Who realizes that a washing machine only uses half as much electricity when laundry is washed at 40 degrees Celsius (104 degrees Fahrenheit) instead of 60 degrees? The average customer of utility companies in Germany like RWE, Vattenfall, Ruhrgas or who tanks up at Shell or BP is totally clueless -- and irrational to boot.

“People drive across town to buy meat for 99 cents,” a bemused Kohler says while lamenting how much those same people ignore the potential gains from simply being a little more conscious about how they use energy. The widespread attitude assuming that electricity is cheap and always available from a wall socket annoys the Dena boss: “We have to get away from that.”

Very few already have managed to do so. Barbara Schweer and Martin Hoyer are exceptions. They moved with their daughter to a housing development in the southwestern German city of Freiburg consisting of 47 energy-efficient structures.

Positive-Energy Homes and Next-Generation Lighting

Their penthouse is heated entirely from a nearby wood-fired power plant. “We had heating costs of only €300,” says Schweer, referring to the paltry annual bill for the 167 square-meter (1,800 square-foot) apartment. The secret of such savings is the house’s extensive insulation. Even on cold days in February, the thermostat is often kept at a low temperature. The south-facing glass side of the structure captures the winter sun, but during the summer the sun is high enough in the sky so that the rooms don’t heat up.

The building, a so-called positive energy house, actually produces more energy than its residents need -- it’s essentially a tiny power plant. The solar panels on the roof produced almost 9,000 kilowatt-hours of electricity in the first year. Subtract the structure’s own power usage along with heating costs and there’s still a surplus of around 2,000 kilowatt-hours left over. The monthly expenditures of €100 for electricity and heat are more than offset by the €400 in revenue the solar panels bring in.

The key point is that the family can actually make money with its energy-efficient way of living. And it doesn’t require spending winter evenings reading by candlelight or taking only one warm shower a week. But such homes remain the exception in both Europe and America. Most of the 17 million houses and apartment buildings in Germany spend some 30 percent of their total energy use just heating rooms and water. This also happens to be where most of the savings potential lies.

A report by the energy services firm Techem found that a regular heating unit needs on average 15.7 liters of heating oil per square meter. Low-energy houses require only 7 liters. Some models, such as the one where the Hoyer-Schweer family lives, make do with even less. And such structures no longer look like oversized burlap bags.

Making old buildings fit for the future

The biggest energy-wasting culprits are older buildings. They burn around 50 liters of heating oil per square meter. Unfortunately they also make up the majority of the structures in Germany. Three quarters of all houses and apartments were built before 1977, when strict insulation regulations went into effect. That’s more than 12 million structures in Germany alone.

“There’s a backup in renovating old buildings energy-wise,” says Andreas Troge, head of Germany’s Environmental Protection Agency. And that slowdown will be hard to change -- only one percent of all real estate is renovated each year.

When homeowners call upon carpenters, electricians or plumbers, it’s usually for cosmetic repairs. Perhaps the bath will be spruced up, the stairway painted or the kitchen modernized. But unspectacular renovations in the cellar or in the attic are usually the ones that never get done. That’s not where guests will be looking.

Only when the heating bill shows up do some people decide to take action. Often they get advice from someone like Peter Hirt, an energy consultant for the consumer protection association in the northern German city Kiel. The trained engineer then searches for those spots where a house leaks heat. It could be poorly insulated cellar ceilings, thin frames for built-in blinds or even boilers placed in non-insulated niches in foundation walls – a typical building practice in the 1960s. “They make nice red spots on the infrared camera,” says Hirt.

Every blot of color on his monitor represents money lost. Homeowners could save up to two-thirds of their heating costs if they took advantage of all the technology available. The installation of a condensing boiler -- which makes use of its own exhaust for heat -- could be combined with solar panels or a heat pump, as well as a properly insulated roof, walls and windows.

Policies spur home improvements

Beginning in 2008, the European Union will require the issuance of energy certificates for homes and apartments that rate a building's energy efficiency. Though home and flat owners are excluded from the certificate rule, they will be required to obtain one if they sell or rent out the property. Like so many regulations that come out of Brussels, the final energy certificates and requirements are a watered-down compromise. Indeed, in some instances, the certificate will include little more information than the previous year's heat and electric bill. But those dealing in real estate expect the energy certificate to change the industry, since the added transparency could end up having consequences for the market value of homes and apartments, as well as the rents landlords charge.

Requirements like the energy certificate could help consumers do the right thing. But tax credits and other incentives provided by the government also help.

Germany's KfW development bank has around €5.6 billion to support energy renovations through 2009. That’s four times as much as in previous years. The state-backed financial institution offers low-interest loans of up to €50,000 ($66,800) per apartment, as well as grants topping out at €8,750. The program ends up working like government aid to prime the economy -- helping in particular smaller, regional architects, carpenters, and heating installers. “For every billion euros invested in the renovation of buildings for energy reasons, 25,000 jobs in the construction sector are created or secured,” the latest environmental report of German federal government claims.

However, the involuntary heating of their surroundings isn’t the only way homeowners waste energy. They also use far more power than necessary for their household electronic devices -- be it their refrigerator, freezer, computer, stove or lamps. With very little effort each household could cut their electricity usage by one-third.

The first thing to do is to install switchable outlets that ensure that electronics are completely cut off from the power network -- including those models that no longer come with an “off” button. Normal household devices using a so-called “stand-by” function can use more than €90 in electricity each year. A computer with a monitor and printer can alone eat up €24. Germany could shut down two large power plants if the country’s consumers did without such unnecessary electronic idling.

It’s also underestimated just how much power the circulation pumps of a home’s heating system use. New models that regulate warm water according to time and temperature use only a fraction of the energy the older ones do, which lowers costs considerably. Germany could in theory switch off another power plant if most of the heat pumps in the country’s single- and two-family homes were replaced. That’s the problem, though: 60 percent of the public isn’t even aware that their oil or gas heat uses electricity.

Light savings

The potential savings from lighting are especially impressive. Regular incandescent light bulbs have used the same primitive operating principle for the past century: a coiled wire, usually tungsten, glows under electricity in a glass vacuum. This method is much like a joke without a punch line: Only five percent of the electricity is actually converted into light. The rest is wasted in heat. Despite such horrible inefficiency, shops in Europe continue to sell some 2 billion of these energy-wasting light bulbs each year.

Lighting is by far the biggest item on the power bills for office buildings. Streetlights also devour huge amounts of electricity. Often they are outdated models from the 1960s still lighting city streets or paths. If Europe’s civic planners switched to modern lighting they could save between €600 million to €700 million each year.

A research lab in the western German city of Aachen offers a view of what the future of lighting holds. Here, some of the 260 physicists, computer experts and engineers working for the Dutch electronics giant Philips research new lighting technologies. One of the most promising is Organic Light Emitting Diodes (OLED), which are thin yet wide lighting glass tiles that are coated with a layer of polymers. They can be integrated into walls or furniture, can change color and are especially energy efficient.

“They create completely new possibilities for applications,” says an excitied Dietrich Bertram, the director of Philips OLED research unit. His vision is that in a few years such new lighting will hopefully replace classic neon tubes. Traditional LEDs are already known to last much longer than even compact flourescent light bulbs and are more robust and less sensitive to vibrations. They also react extremely quickly, which is why the auto industry is using them more and more for brake lights.

The Growth Market for Green Energies

Such examples show the immense growth opportunities that greener technologies offer. The current global market volume for efficiency-related technology is estimated by the German Environment Ministry to total €400 billion and it is expected to grow to €1 trillion by 2030. And German companies are well positioned to get a big chunk of that business.

Generous subsidies from the last German government of Social Democrats and Greens have given German firms a good head start in developing renewable energy technologies such as hydro, photovoltaic and wind power. Both laws and subsidies for pilot programs have also helped German innovators become internationally known. Wind power is on the verge of “conquering the world market,” says Fritz Vahrenholt, head of Hamburg-based wind turbine builder Repower.

Prospects for exporting new high-tech innovations do indeed look promising. Around 19 percent of all environmentally friendly technologies currently come from Germany, Chancellor Merkel told the German parliament last November. “It could well become more,” she said encouragingly.

China is showing particular interest in “Made in Germany” eco-technology. The leadership in Beijing knows expensive resources need to be used more efficiently if the world’s largest country is to avoid an ecological disaster. According to the government’s rather ambitious planning, the Chinese are to become four percent more energy efficient each year. That will take more than just windmills and solar panels -- products from more traditional sectors like regulatory technologies, material science and power plant construction will be necessary as well. All are areas where Germany industry is well represented.

German engineers are developing turbines that are more efficient. They are inventing tires that have a lower resistance while rolling. And they are coming up with magical materials that offer better insulation.

Burkhard Schwenker, CEO of the Munich-based Roland Berger international business consultancy, believes the German environmental technology sector is already on its way to becoming a “leading industry” and local manufacturers are “fantastically” well positioned to compete globally. The consultant is forecasting growth of eight percent annually in the sector, eventually increasing the number of jobs in the sector from 170,000 today to around 700,000.

Extra costs that pay off

The technology is available, it’s just not being used often enough. Both industry and service providers are still far too ignorant about the cost of energy, even though they otherwise seem extremely keen to reduce waste and trim expenses.

Ernst Ulrich von Weizsäcker, co-founder of the Wuppertal Institute and current dean of the Donald Bren School of Environmental Science and Management at the University of California at Santa Barbara, finds it puzzling that more firms aren't trying to squeeze more efficiency from their energy usage. “I don’t know of any sector where it would be impossible to increase energy productivity fourfold,” he says.

If companies, for example, installed more electric motors with modern regulating technologies, the German economy could save as much energy as that produced by three or four large power plants. But normally they decide to purchase what they’re familiar with -- that is, the cheap models. They’ve apparently overlooked the fact that, over the long term, 90 percent of the outlays for operating a power unit are made up of electricity costs. In other words: The extra expenditures upfront more than pay for themselves in the long term.

And that’s the effect Freund Drehtechnik GmbH, a small western German company making rotating machinery components, is counting on. The firm recently invested €12,000 in a lighting system for its new assembly hall -- €4,000 more than traditional lighting would have cost. The company based in North Rhine-Westphalia installed energy-saving fluorescent lamps with special sensors that adjust automatically according to the ambient natural light. The extra costs will be amortized within three years.

But many businesses are adopting better energy efficiency at a molasses pace. For many executives it’s still easier to complain publicly about energy prices than it is to search internally for ways to use new conservation technologies. At least part of the corporate world, however, has begun thinking differently -- either for image reasons, out of conviction or simply to trim costs.

  • The logistics company UPS is working on optimizing electronic navigation for its fleet of vehicles. The system is so advanced that it even suggests routes that avoid unnecessary left turns, which cost both time and fuel.

  • US retail giant Wal-Mart, known for its stinginess when it comes to costs, is outfitting stores with modern lighting and solar panels. The company hopes to cut energy usage by almost a third.

  • Germany’s national rail operator Deutsche Bahn is training its engineers to drive locomotives in a more efficient fashion. Some now even let their trains roll up to 70 kilometers on routes without a noteworthy reduction in speed.

Other companies are making use of the energy contractor model in order to become more efficient and save costs. At Microsoft’s headquarters in Germany near Munich, a contractor managed to squeeze out €100,000 in annual savings even though the building was only five years old. The service provider is a subsidiary of utility company Vattenfall, confirming that even the big energy companies are diving into the new business field.

Otherwise the industry that produces and sells energy is better known for wasting most of it. Utilities don’t get nearly enough out of power plants as technically would be possible. They still use old lignite-fired plants that only reach levels of energy conversion efficiency near 30 percent. Any other industry with similarly low productivity would quickly be put out of business.

In Germany the big firms -- RWE, E.on, EnBW and Vattenfall -- have carved up the territory. They set the industry’s agenda and they are betting on large power plants that require vast quantities of water for cooling and an expensive long-distance power grid requiring lots of maintenance.

Smaller plants that service end customers in urban centers are far more efficient. Such co-generation plants are usually fired by gas and are normally located close to the customers who use the power -- hospitals, schools or industrial facilities. They are also able to provide both electricity and warmth at the same time.

Pushing Consumers to Act

Of course, the big power companies have little interest in such decentralized structures. But the time to make that switchover has never been better. Over the next two decades, utility companies will have to replace half of their power producing capacity, providing a unique opportunity. This would be the best chance to switch over to modern gas- and steam-turbine power plants that convert some 60 percent of the energy used into electricity. Or co-generation plants that use heat produced while making power for heating. Such technologies increase energy conversion efficiency to near 85 percent.

In this regard, Germany is currently lagging behind international developments. The country produces only 11 percent of its power by co-generation plants and only a few German cities such as Flensburg and Schwäbisch Hall produce notable portions of their power this way. In the Netherlands it’s almost 40 percent and in Denmark even 50 percent.

German utilities had once planned to double the number of co-generation plants by 2010, but that goal is likely to be missed. German Environment Minister Sigmar Gabriel has demanded that his cabinet colleague Economy Minister Micheal Glos no longer take the industry by its word when it pledges to meet voluntary targets. Instead, the government should establish clear guidelines for the energy sector.

Lessons from the automobile industry

There's one problem with voluntary commitments from captains of industry: Everyone welcomes them, but no one pushes them. And at the end of they day they’re all just playing for time.

This lesson was learned already during the dispute over limits for auto emissions. In 1998, the German automobile industry promised to cut carbon dioxide emissions on average to 140 grams per kilometer by 2008. That’s roughly the consumption of 5.9 liters of gasoline and 5.3 liters of Diesel per 100 kilometers (39.9 and 44.4 miles per gallon respectively). But Mercedes, Porsche, BMW and Co. are all still quite far from that target, even though it wouldn’t require magic to reach it.

At the Aachen Institute for Automotive Engineering (IKA) scientists are attempting to modify a VW Golf TSI with 170 horsepower by this summer so it uses less than 5 liters of gasoline per 100 kilometers (47 miles per gallon) instead of 7.2 liters. It hasn’t taken much effort to get it down to 5.8 liters already. The scientists have changed the transmission, reduced the weight and minimized the wind resistance. Nothing particularly spectacular. “We want to take it even further,” says engineer Markus Espig. But how can governments encourage such ambition?

A dilemma for the government

The failure of voluntary, industry-wide commitments calls into question how best to improve energy efficiency. Is it enough to offer financial incentives, such as billions in subsidies for renovating buildings, in order to alter behavior? Or should lawmakers instead force changes by legislating new regulations and guidelines?

Thorben Becker of the German environmental group BUND argues the German government could certainly do more. For example, it’s hard to explain why consumers can easily compare energy use for refrigerators and freezers, but that there are no similiar labeling requirements for electric stoves and hot water heaters. Or why the state doesn’t put more pressure on utilities to fit power plants with co-generation facilities. “We need clear legal requirements,” says Becker.

The governments of other countries in some cases certainly do more. Japan has implemented a so-called “Top Runner” program, which sets the most efficient electronic device in a specific product class as the standard to be measured by for three to 12 years. All other competing products that fail to close the gap are labeled as energy wasters and face being banned from sale.

The Netherlands is trying a subtler approach. The country offers direct subsidies to consumers who buy products that are especially energy efficient. There’s €20 to €30 credit for each square meter of thermal insulating glass and €100 for the purchase of an energy thrifty washing machine.

Under Denmark's Electricity Saving Trust, which became law in 1998, each customer must pay a levy of €0.008 cents on each kilowatt-hour used. That in turn finances Danish conservation projects including a campaign to switch from electric heating to district heating -- which often comes from co-generation plants.

Britain also has a non-profit fund known as the Energy Saving Trust to promote the use of sustainable energies and energy conservation.

The Wuppertal Institute has calculated what would be necessary to set up a similar fund in Germany: A levy of 0.06 cent per kilowatt-hour on oil or gas and 0.09 cent on electricity would add up to €1.5 billion annually that could be used to finance conservation efforts. The result would help consumers save 12 percent more energy by 2015, which adds up to €9 billion each year.

But Germany’s top energy saver, Dena director Kohler, offers a different approach. Consumers, according to his philosophy, have to realize on their own how advantageous it is to use energy more efficiently.

That happens, for example, when someone buys a new refrigerator. Recently, the energy agency provided retailers with detailed information about household items so they could help their customers make more informed decisions about their purchases. One adjustable wheel shows just how much they can save each year by purchasing the device with the lowest power usage.

“In the end, that’s the decisive message,” says a confident Kohler.

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