Can these 10 Cities Make a Dent in the Energy Efficiency Universe?

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Downtown Skyline LACall it a federation for our times. Ten big US cities have joined forces to figure out this energy efficiency thing and show the world how it’s done.

Atlanta, Boston, Chicago, Denver, Houston, Kansas City, Los Angeles, Orlando, Philadelphia and Salt Lake City announced their mission Wednesday: to achieve $1 billion annually in energy savings from buildings. The cities plan to share information among themselves and later the world about their successes and failures.

The city leaders hope to solve a classic market failure that frustrates urban energy efficiency efforts. “The buildings and the money are having a hard time connecting,” said Mayor Eric Garcetti of Los Angeles at a news conference. Garcetti said that he and his counterparts intend to become the “matchmakers.”

Two groups well-versed in energy efficiency efforts – the Natural Resources Defense Council and the Institute for Market Transformation – are organizing and advising the ‘City Energy Project.’ It is backed by former New York City Mayor Michael Bloomberg. Bloomberg Philanthropies, the Doris Duke Charitable Foundation and the Kresge Foundation will fund the effort with $9 million over three years.

The City Energy Project will act in an advisory capacity, helping cities first look for no-cost and low-cost energy savings, such as operational improvements in buildings. Where funding is needed, the project organizers will help cities think through financing strategies with an eye toward attracting private investment.

The project comes at a time when US city mayors are showing strong interest in energy efficiency. Earlier this month, the U.S. Conference of Mayors and Philips issued results from a survey of 300 mayors showing that cities expect to significantly expand their investment in energy technologies over the next five years, with LED lighting, solar and building retrofits as their top priorities.

Moving markets

The project isn’t after one-size-fits-all solutions. Each city will develop a plan by the end of this year suited to its demographics, building stock, energy profile and other factors. The project hopes to demonstrate how to make energy efficiency work in different kinds of cities, according to NRDC’s Laurie Kerr, City Energy Project director.

The project will place emphasis on performance-based incentives and innovation among the cities – it is not pre-judging what will work, say its organizers.

“We have the skills and technology to make buildings more efficient, but we need a coordinated effort by major cities and the private sector to make it happen,” said Cliff Majersik, executive director of the Institute for Market Transformation. “The City Energy Project will give city leaders and the real estate industry the support they need to make buildings better, improving the lives of millions of city residents.”

Ten big cities synchronizing efforts could bring much-needed scale to the building retrofit market. However, the project isn’t about multi-city aggregations or joint solicitations for contracts. Instead, the project aims to help contractors and subcontractors scale-up by building markets within each city. “It is a lot easier to move as a market than it is to move individually,” Majersik said.

A carbon play

City leaders also hope the project will help them attract green tech jobs and assist in their greenhouse gas reduction efforts.

Buildings are the largest single source of U.S. carbon emissions, representing 40 percent nationwide – more than either the transportation or industrial sectors. That number is even more dramatic at the city level, with more than half of carbon emissions in most U.S. cities coming from buildings – and in some cities as much as 75 percent, according to the project organizers.

The cities hope their efforts will result in greenhouse gas reductions equal to removing 1 million to 1.5 million cars from the road annually, and reducing energy use to the tune of shutting down 3-4 power plants, roughly the amount of electricity used by 700,000 to 1 million American homes annually.

The cities chosen were not necessarily the greenest or most tech savvy in the country. Instead the project organizers considered a city’s drive and potential to achieve significant energy savings. They also sought geographic spread to create representation nationwide.

What are the 10 top US cities for energy efficiency? See a list here by the American Council for an Energy Economy. (Not to be confused with the 10 cities participating in City Energy Project)

“With U.S. buildings consuming more primary energy than countries like Russia and India, the scale of the opportunity to optimize building energy performance is significant,” said John Mandyck, chief sustainability officer, UTC Building & Industrial Systems. “Cities collaborating and implementing creative, practical energy efficiency polices can go a long way to reducing America’s $450 billion annual energy bill and carbon emissions.”

Can this work? What avenues should city leaders pursue to succeed in “matchmaking” buildings with money for energy efficiency? Please post your thoughts here or join the discussion on our LinkedIn group.

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Elisa Wood About Elisa Wood

Elisa Wood is the chief editor of MicrogridKnowledge.com. She has been writing about energy for more than two decades for top industry publications. Her work also has been picked up by CNN, the New York Times, Reuters, the Wall Street Journal Online and the Washington Post.

Comments

  1. jeff byers says:

    thank you! great article!

  2. Cities participating in the Cities Energy Project should make use of the Deep Retrofit Value practice guide for owner occupants recently released by Rocky Mountain Institute. The paper would help spur investments by building owners in participating cities, and can be downloaded via the following link: http://www.rmi.org/retrofit_depot_deepretrofitvalue

    A brief summary of the practice guide:
    Energy efficiency projects in the United States and around the world are attractive investments, but receive far less attention and capital than they deserve. This is in part due to a narrow definition of their value that typically focuses on saved energy costs. Investors often ignore additional value—a robust land of untapped opportunity that sits just beneath the surface of the saved-energy-cost tip of the value iceberg—to their own financial detriment. Including all value created by highly efficient buildings when investing will enable more low-energy buildings and retrofits—particularly deep retrofits.

    Deep retrofit value is the net present value of all of the benefits of a deep energy and sustainability investment. The Deep Retrofit Value Guide documents the compelling logic of how deep energy efficiency and sustainability retrofits create value and introduces RMI’s Deep Retrofit Value models, providing the foundational methodology necessary to calculate and present value to retrofit decision makers.

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