Efficiency Improvements Could Reduce Energy Use 23 Percent by 2020
On July 29, McKinsey and Company released its report Unlocking Energy Efficiency in the U.S. Economy, expanding on its 2007 analysis for reducing greenhouse gas emissions. The report found that by 2020, the United States could reduce its energy demand 23 percent through energy efficiency measures. This is equivalent to 9.1 quads (quadrillion BTUs or British thermal units) in end use energy and 18.4 quads in primary energy, “potentially abating up to 1.1 gigatons of greenhouse gasses annually,” the report noted. These same measures could lead to an estimated $1.2 trillion in savings with an upfront investment of $520 billion. “If we do nothing, we will waste $1.2 trillion of energy," McKinsey partner Ken Ostrowski said. “That investment pays back – it's one of the few that generate environmental benefits and economic cost returns.” Unlocking the potential requires “addressing all barriers in a holistic rather than piecemeal fashion.” Some of the means to overcome these barriers include information and education, incentives and financing, codes and standards, and centralized third party involvement. “In the nation’s pursuit of energy affordability, climate change mitigation, and energy security, energy efficiency stands out as the single most promising resource,” the report concluded.