Sep. 30, 2009 at 12:56 AM ET
Noah Berger / AP file
The Rocky Mountain Institute's Amory Lovins has been called a
"techno-optimist" on energy issues.
If someone told you America's long-term energy needs could be met without oil or nuclear power, would you think he was crazy? The craziest thing about Amory Lovins is that he says the financial numbers prove it.
"We feel very comfortable that we're likely to have an important and coherent story about the profitable journey beyond fossil fuels, to stuff that works better and costs less than the present arrangements," Lovins, co-founder of the Colorado-based Rocky Mountain Institute, said in an interview.
The institute's story will get a full airing this week at "Reinventing Fire," a two-day symposium in San Francisco focusing on energy efficiency, renewable energy and the prospects for creating an economy that has no need for fossil fuels. The event is one of the year's highlights for Lovins' institute, a "think-and-do tank" that advises corporate and government clients on energy issues.
Over the past year, crude-oil prices have been swinging dramatically up and down. This week has been marked by something of a down cycle, with per-barrel prices settling in the mid-$60s. But when Lovins talks his way through the calculations, he almost makes you wonder why anyone is buying oil at all.
"If the average cost of saving half the oil is, as we showed, 12 bucks a barrel in year 2000 dollars, and the average cost of displacing the other half with natural gas and advanced biofuels unrelated to food is 18 bucks a barrel, then the average cost of getting off oil is $15," he said. "And I don't care what the price is, that's still going to make sense and make money."
Lovins' key to cost saving is making energy-consuming devices radically more efficient — for example, by using lighterweight materials in cars, designing them to be more aerodynamic and giving them better drive trains and tires.
"We save half the oil by tripling the efficiency of cars, trucks and planes," Lovins said. Sure, that requires a big investment in retooling, but Lovins said his numbers suggest that a $180 billion investment (a number selected when $180 billion "sounded like a lot of money," he joked) could reap a net return of $70 billion a year. "A very handsome return," he said.
The way Lovins runs the numbers is to add up efficiency factors and shrink the cost of operation further and further toward zero. For example, going to hybrid cars would cut gasoline consumption in half, he said. Making them lighter and more aerodynamic would cut the cost in half again. Using 85 percent cellulosic ethanol in the fuel tank would reduce the cost by three-quarters, and by the time you add in plug-in electric recharging, you're driving a car for 3 percent of the operating cost of a gas-guzzler.
In the past couple of years, Lovins has putting more emphasis on electric power as a replacement for liquid fuels. Last year, the Rocky Mountain Institute spun off Indiana-based Bright Automotive as a for-profit venture to develop a super-efficient plug-in hybrid, an idea that Lovins has been kicking around for more than a decade. The 100-mpg Bright IDEA fleet vehicle was finally unveiled in April and is slated for mass production in 2012.
To keep those IDEAs running, Lovins foresees the development of "smart garage" technology that can charge up cars at home or at work, and even use those car batteries as a backup power supply for the country's future "smart grid."
The energy for that smarter grid would come increasingly from solar, wind, geothermal, hydro and other renewable energy sources. Even now, wind power can be more economic than, say, using natural gas to generate electricity, Lovins said.
"Some smart operators were buying firm wind power and selling it into the peak to free up gas from those inefficient simple-cycle turbines, and then they would sell the gas on the gas market," Lovins said. "It was like buying gas for four to four and a half bucks and selling it for, at the time, about $7 or $8. That was much more lucrative than just selling wind power."
And what about nuclear power? Some energy experts believe more nuclear plants will have to be constructed if energy markets turn away from coal, oil and gas.
"Well, unless you're thinking of adopting a centrally planned economy and forcing taxpayers to pay for them, it's not going to happen," he said, "because they're hopelessly expensive to build."
Fans and foes
All this has won Lovins legions of fans in the renewable-energy field — and plenty of awards as well, ranging from a MacArthur "genius grant" to the Right Livelihood Award. But Lovins also has some outspoken critics, particularly for his views on nuclear power. NEI Nuclear Notes' David Bradish, for instance, devoted a whole series of blog posts last year to what he saw as the "flaws and inconsistencies" of the Rocky Mountain Institute's energy claims. Bradish and others claim that Lovins and his colleagues at the institute cook their figures to make nuclear look overly bad and make renewables look like a sure thing.
Other critics worry that Lovins is just too much of a techno-optimist, a "voice crying in the wilderness" who takes energy efficiency to an unmatchable extreme. Even his super-efficient Colorado home, equipped with a greenhouse suitable for growing bananas, has attracted rants as well as raves. Last month, The Wall Street Journal's Jeffrey Ball wrote that a recent renovation of the house "serves as a reminder of the still-enormous gulf between what is technologically possible and what society is able or willing to pay for."
Lovins sticks to his central claim that energy efficiency need not entail sacrifice, even when it comes to cultivating those bananas.
"I don't think anybody would find it a burden or a sacrifice to live here," he said. "It's just an extra bonus that you can eat your fresh bananas as you walk in out of a February snowstorm, and then you realize that there's no furnace. That's because you build it right."
The way Lovins sees it, his prescription for fixing America's energy economy has been getting through more easily now with President Barack Obama and Nobel-winning Energy Secretary Steven Chu in office. "If anybody can fix it, it's Steve Chu's team," he said.
But Lovins said his prescription doesn't depend on carbon taxes, renewable-energy subsidies or any other federally mandated changes in the economics of energy.
"The sort of energy policy I would love to see — and I hope I do live to see it — is an economically conservative one that allows and requires always to save or produce energy, to compete fairly, at honest prices, regardless of their type, technology, size, location or ownership," the 61-year-old said. "Let's see who's not in favor of that. Hint: It will be many of the incumbent corporate socialists masquerading as free marketeers."
More on Lovins and green energy:
This report is also available in msnbc.com's Green Innovation section.