“How many of you live in a building that has had a deep energy efficiency audit? Do you even know? What about the building that you work in?” Marshall Salant, the Head of Citigroup’s Alternative Energy Finance Department, taunted the audience at the ARPA-E Energy Innovation Summit, during a panel entitled “The Future of Financing Energy Efficiency.”
Despite present market opportunities, over $50 billion in commercial sector and $80 billion in industrial sector, that would yield over $1.2 trillion in savings, the ‘free’ market has failed to finance retrofits.
“The volume of truly low-hanging fruit, with less than an eight-year payback, is enormous,” said Dr. John Byrne, distinguished professor of Energy at University Delaware and advisor to the IPCC. The panel’s moderator Richard Kauffman, Senior Advisor to the Secretary of Energy Steven Chu, likened the efficiency savings left lying on the table to the old finance joke in which two economists walk away from a $20 bill on the ground because “if it was really there, someone would have picked it up already.”
Efficiency projects face barriers that include: lack of education about services and benefits, complicated financing mechanisms, and a landscape of standards that looks like the wild west. However, emerging IT platforms and business models are succeeding in breaking through economic barriers while adding dollars to their customers’ bottom line.
Prometheus Institute 