Energy consumption in our homes, businesses and workplaces: a future view
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PLACE IMAGE HERE
Energy consumption in our homes, businesses and workplaces: a future view
Mike Underhill, Chief Executive
NERI Winter Lights 2011, 16 June 2011
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The global energy challenge
• Peak oil / sustainability
• Climate change
• Pollution and other environmental concerns
• Competing demand for resources (including land, water)
• More expensive oil exploration to meet demand
• Higher fuel prices
• Price on carbon to combat climate change
• Growing consumer pressure for low carbon goods
• Strong investment in renewables globally
CAUSE EFFECT
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NZ – among the world’s leaders in renewable energy
Contribution of renewables to total primary energy supply (2007 OECD Statistics)
2.3% 2.9% 3.1% 3.6% 5.0% 6.0% 6.3% 6.9% 7.2% 7.2% 7.2%
16.5% 16.8%19.9%
23.2% 23.2%
30.0% 31.0%
50.4%
Un
ited
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Bel
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Ger
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Ital
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Sp
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Can
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Sw
itze
rlan
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Fin
lan
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New
Zea
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rway
Source: OECD Factbook 2009: Economic, Environmental and Social Statistics
(But renewables still very much the minority source of energy for NZ)
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Where our total energy comes from
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Where we use energy
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Where our electricity comes from
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Where we use electricity
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How the sectors fare
Efficient use
Renewable, low carbon
Non efficient
Non renewable, high carbon
products
industry
homestransport
businesses
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NZ’s fossil fuel exposure
• More than half of all energy is fossil fuel – much of that used in transport
• Transport fuel demand is highly inelastic – alternatives are limited
• Export economy reliant on oil (agriculture/ fishing/forestry)
• New Zealand’s distance from our export markets is a real or perceived risk (“food miles”)
• Per capita GHG emissions are high – reputational risk for 100% Pure New Zealand
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The challenge
• Replace fossil fuels with renewables
• Use energy more efficiently, especially high carbon sources
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Supply side opportunities – getting more renewable
Renewable electricity
• 90% by 2025
• Geothermal, wind and hydro – existing technologies
• Marine, biomass, solar – developing technologies
Renewable heat
• Wood energy a cost-effective and viable replacement for coal
Renewable transport
• Electric vehicles and first generation biofuels – viable now but price is a barrier
• Advanced biofuels on their way
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Where the 90% will come from – existing, planned and potential generation
October 2010
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Renewable heat and fuel
Case study:
Southern Pine - installed a briquette press turning MDF dust into combustible briquettes for boiler fuel. Saves $180,000 a year generates $25,000 in revenue
• Biomass could supply more than 25% (currently 8.5%) of the country’s energy needs by 2040 (BANZ Bioenergy strategy)
• Wood from forest harvest and processing residues
• Biogas from municipal, agriculture waste and food processing residues
• Liquid biofuels
• Direct geothermal energy for heating and cooling
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Renewable transport
Biofuels
• Biodiesel – currently made in NZ from used cooking oil, rapeseed oil (canola) or tallow
• EECA grants programme has kick-started biodiesel production in NZ
• Bioethanol – made from NZ whey or Brazilian sugar cane
• Ethanol – no excise tax applies (unlike petrol)
• EECA has biofuels sustainability criteria on its website – includes CO2 reduction and source of feedstock
Electric vehicles
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Electric vehicles
• EVs make sense for NZ now
• Highly efficient users of fuel – which in NZ is mainly renewable
• Dedicated infrastructure unnecessary in short term
• They can work with our 230 Volt domestic supply
• They fit New Zealanders’ travel patterns– 90% of NZ vehicles travel less than
84km a day– For main urban areas less than 69km– 52% of NZ households have 2 or
more vehicles
• CAENZ study shows for 390,000 EVs on road by 2025 will require only an extra 180 MW capacity
• Price remains a barrier
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NZ’s solar energy potential
SeriesSource: IT Power & Southern Perspectives report for MED, 2009
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Demand side opportunities
Homes• Housing design to minimise energy use in new builds• Insulation, double glazing, draught-proofing retrofits• Appliance and lighting efficiency• Behaviour change
Businesses• Appliance and lighting efficiency• Tuning boilers, continuous commissioning HVAC• Co-generation• Motorised systems
Transport• Fuel economy improvements• Public transport / modal shift• Driver behaviour
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$4 billionTotal savings in 10 years
Residential $1.6 billion
Business and
Primary production$2.5 billion
Dwellings $0.5 bn
Private cars $1.1 bn
Heavy Industry$0.2 bn
Food Production
$0.4 bn
Business transport
$1.1 bn
Tourism$0.1 bn
CommercialBuildings $0.3 bn
OtherBusiness$0.5 bn
NZ energy savings potential
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Houses – we all live in one
• Third of electricity used in the home
• Long term impact of investment
• Has an impact on health and well-being – huge losses for society could be avoided
• Many NZ houses are substandard
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The typical New Zealand house
• NZ’s traditional light timber framed structures are very inefficient
• 80 kWh/m2/year in NZ
• Denmark has target of 16 kWh/m2/year
• Examples of poor performance include– Insulation– Air tightness– Glazing– Alignment– Heating– Lighting
• Our cold damp houses are a major health hazards as well as really expensive to heat
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First Light house – “eco bach”
• Highly insulated
• Designed to maximise solar gain
• Solar water heating and photovoltaics
• LED lighting
• Energy monitoring system
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White ware and appliances
• Minimum Energy Performance Standards (MEPS) keeps the lowest performing appliances out of the NZ/Aus market
• Labelling helps consumers compare efficiency (energy rating) or buy the top performers (ENERGY STAR)
• The average new fridge uses half the energy it did in 1990.
• Computers and consumer electronics are making up a growing portion of our electricity bills – expected to double by 2020
• Standby can use 400 Watts continuously
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Business and transport
• Big opportunity for savings across the whole economy
• Transport and business sectors offer biggest savings
• And business transport has huge potential – 18 PJ by 2015
• Some savings will be BAU gains
• EECA’s business programmes could achieve about 14PJ by 2015
• Significant increase from current levels – current rate = 5PJ by 2015
• Example: Commercial refrigeration uses 10.5 PJ p.a. – estimated 15% savings available
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Areas of potential (by technology)
Economic Savings Potential By Top 8 End-Use Technology Measures 2015/16 (Business Sector only) - total = 58 PJ
6.47 , 11%
3.75 , 6% 1.20 , 2%
8.15, 14%
14.00, 25%
10.16, 18%
1.40 , 2%
12.92 , 22%
Motorised systems (electricity) - KEMA 2016
Lighting (electricity) - KEMA 2016
HVAC (electricity) - KEMA 2016
Refrigeration (electricity) - KEMA 2016
Goods Vehicles - Load factors - OPENZ2015
Cars (non-private) - Fuel consumptioneconomy (diesel & petrol) - OPENZ 2015
Process Heat - EECA 2015
OtherElectricity Diesel, PetrolNatural gas / coal / wood/ other
Source: OPENZ, KEMA (electricity), and adjusted by EECA data on process heat
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Transport efficiency in action
Downer New Zealand Ltd,
Supreme Winner at the 2010 EECA Awards
• Included GPS initiative for fleet, introduction of driver behaviour programme
•Projected savings $3 million and 12,000 tonnes of CO2 a year
•Payback for most opportunities less than one year
•Additional benefits - driver training also improves staff and public safety, reduces property and vehicle damage, carbon emissions and insurance premiums
•Enhanced business reputation
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Technology is only one part of the solution
• Who designs houses?
• Who buys cars and drives them?
• Who chooses whether to turn their lights off when they leave the room?
• Who decides the priorities for investment in a company?
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People
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What influences energy use in the home?
Transport
TechnologyBehaviour
Envelope
Products
Conservation
Products
Transport
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How do we influence behaviour?
• Information
• Incentives
• Regulation
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Example: Providing the right information at the right time
• The average age of our light vehicles is 12.8 years old.
• 33% of light vehicles are 15 or more years old
• The average age of used imported vehicles — which make up almost half of the light vehicle fleet — has reached 14.4 years old It’s important to influence
this long-term decision – e.g. through vehicle fuel economy labels at point of sale.
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Example: Providing funding/incentives
• Warm Up New Zealand: Heat Smart
• 100,000 homes insulated in two years
• Another 100,000 over the next two years
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Co-benefits are key to engaging customers
EECA research shows people are motivated by different things
Sustainablefuture
Warm comfortable home
$$$$$$
Healthyhome
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Co-benefit examples
• Health and welfare are the two biggest residential co-benefits
• Profitability and branding are the big business co-benefits
• Safety is the big transport co-benefit
The co-benefits with the greatest impact are often emotional
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Behaviour change needed for maximum benefits
+ =EFFICIENT TECHNOLOGY
EFFICIENT BEHAVIOUR
MAXIMUMBENEFITS
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Behaviour change works
• Almost 2.4 million New Zealanders have seen Energy Spot
• 1 in 5 New Zealanders have taken action as a result of the Energy Spot
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The “co-benefits” of energy efficiency and renewable energy
• Energy security – Future proofing against limited cheap supplies of fossil fuels
• Reduced dependence on volatile global oil prices
• Sustainabilty - efficiency means resources go further
• Reduces the overall growth and peak demand for electricity
• Defers the need for new investment
• Reduces future wholesale electricity price
• Improved health and welfare of our citizens
• Helps meet international climate change obligations
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The wider economic co-benefits
• Billions of dollars saved – reinvest into the economy
• Improved productivity and competitiveness of our businesses
• International competitive advantage
• Combat ‘food miles’
• Globally differentiate ourselves with our ‘brands’ of fresh water, fertile land and renewable energy
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Summary – a future view
HOMES
• Zero energy or energy positive homes are the norm
• Small scale renewable energy is affordable
• People choose the most efficient appliances and only use them when needed
• Smart technology helps people save energy
BUSINESSES• Thriving, productive business
sector resulting from uptake of energy efficient and renewable technologies
• NZ exports differentiated in the market for their low carbon production
• Renewables used for process heat
• Saving energy part of everyday office/workplace culture
TRANSPORT• Transition from current system
dominated by imported oil to predominantly home-grown and renewable fuelling
• Behaviour change, improved technology, renewable fuels all play a role
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