All For Efficiency

Mark Green
Posted May 4, 2012

A recent post on the White House Blog updates the administration’s effort to see federal agencies make at least $2 billion in energy efficiency upgrades over the next two years. Heather Zichal, deputy assistant to the president for energy and climate change, writes that agencies have identified $2.1 billion in projects that will pay for themselves using performance-based contracts. Zichal:

“Of the $2.1 billion in energy upgrade projects identified by agencies, more than $100 million in Energy Savings Performance Contracts (ESPCs) and Utility Energy Savings Contracts (UESCs) have been awarded already, and an additional $1.2 billion in projects are in development – demonstrating strong momentum towards meeting the President’s goal.”

Later, Zichal notes that increased energy efficiency has a multitude of benefits:

“[It’s] one of the fastest, easiest, and cheapest ways to create jobs, save money, and cut down on harmful pollution. … In this pursuit, we take an all-in approach. Whether it’s the historic fuel economy standards that will nearly double the miles you can go on a gallon, or investments that have led to more than a million homes weatherized across the country – we keep building on efficiency, and we keep betting on American workers and American know-how to help create a secure energy future.”

Clearly, the country is becoming more energy efficient, as this chart from the Energy Information Administration, showing energy use per capita (green line) and projections (1980-2035), shows: 

America’s oil and natural gas companies share the goal of increased energy efficiency. ExxonMobil’s Ken Cohen calls efficiency “our most powerful energy solution.” Cohen writes:

“Efficiency — technologies and actions that enable us to do the same, or more, only with less energy — is often overlooked as an answer to the question of how we will meet rising energy demand safely and affordably, while also reducing greenhouse gas emissions.”

Industry has invested heavily in efficiency measures – devoting more than $239 billion since 1990 to improve the performance of its products, facilities and operations. API’s 2012 State of American Energy report:

“Energy efficiency is the cleanest, quickest and most cost-effective way to extend today’s energy supply into the future. The efficient use of energy is not only a core value of the oil and natural gas industry, it’s also a daily practice.”

Some examples:

• Technological advances, such as 3D seismic visualization and horizontal drilling let companies access resources more precisely and with less impact on the environment. It used to take a 20-acre drill site to access an area of one square mile underground. Today, 80 square miles can be accessed with a drill site as small as two acres. Half as many wells are needed to produce the same amount of energy as 20 years ago.
• Submersible, remotely operated vehicles allow deepwater operators to install, monitor and repair underwater equipment using less energy.
• Plants and refinery upgrades have increased facility energy efficiency.
• Combined heat and power, or cogeneration, technologies use excess heat from to produce additional energy, for example, in refineries.
• Carbon-reducing technologies that help promote greater overall efficiency attracted more than $70 billion in industry investments 2000-2010 – well more than the federal government over the same period and nearly as much as all other private industries combined.

When it comes to energy efficiency, America’s oil and natural gas companies are on it.