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Conservation vs Efficiency: Sweaters are Not the Answer

Letter from the CEO
By Michael Potts

A newly elected Jimmy Carter appeared on national television 30 years ago in a beige sweater and declared that energy issues would call from us a level of effort that was “the moral equivalent of war.”

He strongly urged the nation to “learn to live thriftily” and adopt “strict conservation.”

Wags called him “Sweater Jimmy” to make fun of his plea to turn down our thermostats. And when real energy prices declined in proceeding years, they looked at his comments with nostalgic ridicule.

Today, when energy prices are hitting historic highs, many fear that “strict conservation” will mean draconian deprivation. Sweaters required in winter, clothing optional in summer. Stop driving, wind down your thermostat, quit taking showers, and turn off your television.

Americans, famously independent, hate being told what to do. So there is, at times, a polarizing effect of two opposing camps: “greenies” installing double-flush toilets, and defiant “skeptics” driving Hummers.

The irony is that both camps miss the real point.

If we want to reduce fossil fuel use, become energy independent, and cut carbon emissions—the first thing we have to do is improve the efficiency of the way we use energy in the first place. To reduce your miles driven by 20 percent in a vehicle that gets nine miles to the gallon is progress, but it’s missing the point. It’s also somewhat futile to set your air conditioning thermostat up two degrees in a building with single-pane windows and poor insulation.

Between 75 and 90 percent of the energy we consume is wasted due to bad design and poor choices. We live in a world where energy has been so cheap for so long that very few people have paid attention to it, and most of our energy services are delivered in a sloppy, inefficient manner.

Architects don’t buy the energy their buildings consume, car companies don’t pump gas for their SUVs, and landlords don’t want to make energy improvements that will only benefit their tenants. Throughout this entire system, most of the key players—oil companies, utilities, manufacturers—make more money if we buy bigger machines and use more fuel. In fact, the metrics we use to measure growth and success generally register efficiency gains as a negative trend!

Consider the legions of smart, dedicated, and fundamentally reasonable people who make their living in the current morass of mixed signals, dysfunctional policies, and ineffective incentives. Sometimes it almost seems as if our economic systems were designed to encourage the wasteful and destructive use of resources. If we wait for market forces to correct these imbalances, we will be waiting for a long, long time.

Enter RMI. On these pages you will see examples of our quest to see across boundaries, to confront “whole systems,” and to collaborate with leaders who are committed to transformational change.

We use philanthropic support to identify radical resource efficiency solutions and to bust the barriers that hold them back. We convene key players and thought leaders from industries that are target-rich in efficiency opportunities to examine standards and establish new visions. Then we identify organizations that are committed to transformation and work with them to execute client-funded demonstration projects.

These projects multiply the impact of the philanthropy we receive and prove that the solutions are “ready for prime-time.” We can then communicate the concepts and benefits of these solutions to a wider audience and pass them on to our for-profit colleagues who can bring them to scale.
It’s cheaper to save fuel than it is to go find more of it. And it’s ineffective to put our efforts into developing biofuels or renewable energy if we pump it into an inefficient system that fritters most of it away.

“Conservation,” in the sense of being conscious and careful about consumption, should be encouraged, and will most likely be part of our final solution. But I think Jimmy Carter would agree, hopefully along with every “greenie” and every “skeptic,” that efficiency—the elimination of waste—is our first priority and our major opportunity.

Michael Potts is CEO of RMI

--Published Fall/Winter 2008