If we were looking for any more signs that energy conservation is now clearly visible on corporate America’s radar, here’s a big one: A major study was just released that describes the potential for energy-conservation improvements as “huge.” Author of the study? McKinsey & Company, that mainstream, brains-for-hire management consulting firm renowned for deploying battalions of its fresh MBAs to explain how to restructure everything from mission statements to shareholder meetings. The mere fact that this kind study was conducted—and by McKinsey—is itself something of a reason for optimism.
There is both bad news and good news about this ambitious 145-page report: Although the U.S. has made significant improvements in energy efficiency in both the residential and commercial sectors in the past two decades, we are still far less efficient than many other industrial nations. The bright side of that is that there is a great deal of room for improvement; there is still a lot of low-hanging fruit to be picked.
McKinsey’s assessment, “Unlocking Energy Efficiency in the U.S. Economy,” was underwritten in part by McKinsey itself and sponsored by several energy companies plus the Energy Foundation, the U.S. Department of Energy, the Environmental Protection Agency, the Natural Resources Defense Council, and the U.S. Green Building Council.
The report starts with by acknowledging that it is already widely understood that our opportunities for greater energy efficiency are indeed significant and asks the question: what has prevented our realizing those many efficiency opportunities from being realized in the past? And how can the nation unlock the efficiency potential in the future?
The report addresses those questions in terms of stationary—that is, non-transportation–energy use in the industrial sector, the commercial sector and the residential sector. The residential chapter—which accounts for about 35% of the potential efficiency gains– is the one that most closely parallels the information and insights contained in the Whole Earth Catalog, and is most accessible.
The obstacles to those huge improvements? Money is, of course, one obstacle. The nation could save over a trillion dollars in energy costs by 2020—but it would require upfront improvements costing some $520 billion. Other obstacles range from inertia to improvements in nationwide building codes. But the central conclusion is that “energy efficiency offers a vast, low-cost energy resource for the U.S. economy,” one that can improve lives, combat global climate change, reduce our energy dependence on fossil fuels and other nations. McKinsey calls it “a compelling nationwide opportunity.”
The report includes an oddly conservative premise: they do not take into account the potential improvements that can result from changes in individual behavior. But we all know from our own experience that individual energy-saving decisions can have real impact in our own homes, communities, and states. There is another reason for optimism.
The McKinsey study is available online.
Tags: Whole Green Catalog
