Making Industry Part of the Climate Solution

Improving the energy efficiency of industry is essential for maintaining the viability of domestic manufacturing, especially in a world economy where production is shifting to low-cost, less regulated developing countries. Numerous studies have shown the potential for significant cost-effective energy-savings potential in U.S. industries. A range of regulatory, information, workforce, and financial barriers appears to impede the broader application of high-efficiency industrial technologies.

This research project evaluates seven federal policy options aimed at improving the energy efficiency of industry, grounded in an understanding of industrial decision-making and the barriers to efficiency improvements. Detailed analysis employs the Georgia Institute of Technology’s version of the National Energy Modeling System (GT-NEMS) and spreadsheet calculations, generating a series of benefit/cost metrics spanning private and public costs and energy bill savings, as well as air pollution benefits and the social cost of carbon. Two of the policies would address federal and state regulatory hurdles; three would help to fill information gaps and workforce training needs; and two would tackle financial barriers (See figure).

Comparing the present value of up-front private-sector investment costs with the present value of the stream of energy-expenditure reductions suggests that each of the policies would be attractive to industrialists. The results were presented in the report Making Industry Part of the Climate Solution: Policy Options to Promote Energy Efficiency. A recent presentation at the U.S. Clean Heat & Power Association's 2011 Annual Meeting discussed the report's analysis of policies to promote cogeneration, including preliminary estimates of the job creation benefits: "Evaluating a Federal Cogeneration Policy: Could It Strengthen U.S. Competitiveness and Generate Energy Jobs?"
Annual Meeting. Other publications include the following:

  • Brown, Marilyn A., Paul Baer, Matt Cox, and Yeong Jae Kim. 2013. “Evaluating the Risks of Alternative Energy Policies: A Case Study of Industrial Energy Efficiency,” Forthcoming in Energy Efficiency.
  • Brown, Marilyn A., Roderick Jackson, and Matt Cox. 2011. “Expanding the Pool of Federal Policy Options to Promote Industrial Energy Efficiency,” Proceedings of the ACEEE Summer Study on Energy Efficiency in Industry, July 24, Niagara Falls, NY, pp. I-24 – I-35.
  • Marilyn A. Brown, Matt Cox, and Paul Baer. 2013. “Reviving manufacturing with a federal cogeneration policy.” Energy Policy. 52 (2013) 264–276.
  • Jackson Roderick K., Brown, Marilyn A., and Matt Cox.  2011. “Policy Analysis of Incentives to Encourage Adoption of the Superior Energy Performance Program,” Proceedings of the ACEEE Summer Study on Energy Efficiency in Industry, July 24, Niagara Falls, NY, pp. 4-90 – 4-101.
  • Cox, Matt, Marilyn Brown and Roderick Jackson. 2011. “Regulatory Reform to Promote Clean Energy: The Potential of Output-Based Emissions Standards,” Proceedings of the ACEEE Summer Study on Energy Efficiency in Industry, July 24, Niagara Falls, NY, pp. I-57 – I-67.
  • Benjamin Deitchman, Marilyn Brown, and Paul Baer. 2011. “Green Jobs from Industrial Energy Efficiency,” Proceedings of the ACEEE Summer Study on Energy Efficiency in Industry, July 23, Niagara Falls, NY, pp. 6-27 – 6-38.

Resources:

Researchers:

  • Paul Baer: paul.baer [at] gatech.edu
  • Marilyn Brown: marilyn.brown [at] pubpolicy.gatech.edu
  • Rodrigo Cortes: rcotres [at] gatech.edu
  • Matt Cox: Matt.Cox [at] gatech.edu

  • Benjamin Deitchman: bhd [at] gatech.edu
  • Dr. Roderick Jackson: jacksonrk [at] ornl.gov
  • Melissa Lapsa: lapsamv [at] ornl.gov