South Can Cut Utility Bills, Create Jobs and Conserve Billions of Gallons of Water

According to a new study released today by a team of researchers at the Georgia Institute of Technology and Duke University’s Nicholas Institute, aggressive adoption of energy efficiency programs in the South[1] would lower utility bills by $41 billion, create 380,000 new jobs, reduce the need for new power plants, and save 8.6 billion gallons of freshwater by 2020.[2]

Total energy demand in the South, where per capita energy consumption is already higher than average, is projected to increase 16 percent from 2010 to 2030.  At the same time, many Southern states spend less on energy efficiency programs than their peer states in other parts of the country.  The research strongly indicates the South’s projected growth in energy consumption need not materialize if the region begins to tap into its tremendous energy efficiency potential.[3]

“An aggressive commitment to energy efficiency could be an economic windfall for the South,” states Dr. Marilyn Brown of the Georgia Institute of Technology and co-lead researcher of the study.  “Such a shift would lower energy bills for cash-strapped consumers and businesses and create more new jobs for Southern workers.”

The energy efficiency policies examined by the research team fall into three broad categories: residential, commercial and industrial. Residential policies include changes to building codes, appliance standards and incentives, weatherization assistance, retrofit incentives and equipment standards.  Commercial building policies include appliance standards and building retrofit incentives.  Industrial policies include plant utility upgrades, process improvement policies, and combined heat and power incentives.

“Energy Efficiency in the South” found that the adoption of aggressive energy-efficiency initiatives in the South would:

Prevent energy consumption from growing over the next 20 years. In the absence of such initiatives, energy consumption in these three sectors is forecast to grow by approximately 16 percent between 2010 and 2030.
 Generate new jobs, cut utility bills and sustain economic growth.  Overall utility bills would be reduced by $41 billion each year in 2020 and $71 billion in 2030; the average residential electricity bills would decline by $26 per month in 2020 and $50 per month in 2030; electricity rate increases would be moderated; and 380,000 new jobs would be created by 2020 (annual job growth increases to 520,000 new jobs in 2030). The region’s economy is anticipated to grow by $1.23 billion in 2020 and $2.12 billion in 2030.
Reduce the need for new power plants.  Almost 25 gigawatts of older power plants would be retired and the construction of up to 50 gigawatts of new plants (equal to the amount of electricity produced by 100 power plants[4]) would be avoided.
Result in substantial water conservation. The reduction in power plant capacity would save southern NERC regions[5] 8.6 billion gallons of freshwater in 2020 and 20.1 billion gallons in 2030.
“The set of energy efficiency policies we examined are also highly cost effective,” said Etan Gumerman of Duke University’s Nicholas Institute and co-lead researcher of the study.  “On average, each dollar invested in energy efficiency over the next 20 years will reap $2.25 in benefits.”

The study was developed using the same state-of-the-art economic modeling tool that the U.S. Energy Information Administration uses in making its annual energy forecasts.  The research team used this tool to compare a “business as usual” scenario with a scenario that included a specific set of energy efficiency investments.  As the findings indicate, the analysis found substantial reductions in energy use, prices, utility bills, water use and carbon emissions in the energy efficiency scenario as compared with business as usual. This study provides a useful estimate of the benefits associated with an aggressive commitment to energy efficiency.  Since it does not include every energy efficiency investment that could be considered, it is by no means an exhaustive measure of the benefits associated with an aggressive commitment to energy efficiency.

“Energy Efficiency in the South” and state profiles that have been developed for each of the states are available on the Southeast Energy Efficiency Alliance (SEEA) website: www.seealliance.org/programs/research.php. SEEA is a nonprofit organization that promotes energy efficiency in the Southeast.  This project is funded with support from the Energy Foundation (www.ef.org), the Kresge Foundation (www.kresge.org) and the Turner Foundation (www.turnerfoundation.org).



About Marilyn Brown and Georgia Tech:

Marilyn Brown, a professor in the School of Public Policy at the Georgia Institute of Technology, is an internationally-recognized leader in the analysis and interpretation of energy futures in the United States. In 2007, Brown was a co-recipient of the Nobel Peace Prize along with the other members of the Intergovernmental Panel on Climate Change and Vice President Al Gore. Additional information about Brown and her research can be found at http://www.spp.gatech.edu/faculty/faculty/mbrown.php.  Brown has been nominated to serve on the Board of the Tennessee Valley Authority and awaits confirmation.  

Georgia Tech’s Ivan Allen College of Liberal Arts offers one of the world’s top public policy programs. The research-intensive and globally engaged curriculum aims to solve complex problems in the public interest related to issues of research and technology, energy and sustainability, economic development and governance. The School of Public Policy is dedicated to scholarship and learning that is reflective, effective and sustainable.

About Etan Gumerman and Duke University’s Nicholas Institute:

Etan Gumerman is a scientific engineer at the Nicholas Institute for Environmental Policy Solutions at Duke University.  Prior to joining the Nicholas Institute, Gumerman was employed by Lawrence Berkeley National Lab and served as the lead modeler and analyst for the Scenarios for a Clean Energy Future Project.  In this role, Gumerman coordinated the efforts of scientists at five national laboratories.

The Nicholas Institute is a nonpartisan institute founded in 2005 to help decision makers in government, the private sector, and the nonprofit community address critical environmental challenges. The Institute responds to the demand for high-quality and timely data and acts as an “honest broker” in policy debates by convening and fostering open, ongoing dialogue between stakeholders on all sides of the issues and providing policy-relevant analysis based on academic research. The Institute’s leadership and staff leverage the broad expertise of Duke University as well as public and private partners worldwide. Since its inception, the Institute has earned a distinguished reputation for its innovative approach to developing multilateral, nonpartisan, and economically viable solutions to pressing environmental challenges.


[1] The study covers “the South” as it is defined by the U.S. Census – the District of Columbia and 16 states: Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia and West Virginia.

[2] Bill savings, job creation and water savings #’s are annual numbers as projected in the year 2020.

[3] McKinsey Global Energy and Markets (2009) published an assessment of economic potential for energy efficiency improvements in the United States.  The McKinsey study concluded that the South has the largest energy efficiency resource of any region in the county.  The South accounts for 41 percent of the national potential for energy efficiency improvements.  This contrasts with the Midwest (26 percent), the West (18 percent) and the Northeast (15 percent).

[4] For this calculation, a medium sized (500 megawatt) coal-fired power plant is used for purposes of simplicity.  A larger nuclear power plant produces nearly one gigawatt and a typical natural gas plant produces approximately 300 megawatts.

[5] The North American Electrical Reliability Corporation (NERC) regions covered include all of Alabama, Georgia, Florida, North Carolina, South Carolina, Tennessee, Missouri and portions of Kentucky, Virginia, Illinois, Iowa, Mississippi, Louisiana and Texas.


By David Terraso

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Duke Study Pinpoints Potential 'Green-Collar' Job Growth in U.S.

During the presidential campaign, Barack Obama proposed an economic plan that would create 5 million jobs in environmental industries. These so-called “green collar” jobs do, in fact, present the next frontier for U.S. manufacturing, says a new report from Duke University.

Highlighting the direct linkages between low-carbon technologies and U.S. jobs, Duke researchers say U.S. manufacturing is poised to grow in a low-carbon economy. Their report, “Manufacturing Climate Solutions,” provides a detailed look at the manufacturing jobs that already exist and would be created when the U.S. takes action to limit global-warming pollution. A copy of the study is available at http://www.cggc.duke.edu/environment/climatesolutions/.

“Until now, there was no tangible evidence of what the jobs are, how they are created and what it means for U.S. workers. We are providing that here,” said Gary Gereffi, a Duke professor of sociology and lead author of the report. “We don’t guess where the jobs are; we name them. Our report uses value chains to show that clean technology jobs are also real economy jobs.”

Led by Gereffi, researchers at Duke’s Center on Globalization, Governance & Competitiveness (CGGC) assess five carbon-reducing technologies with potential for future green job creation: LED lighting, high-performance windows, auxiliary power units for long-haul trucks, concentrating solar power, and Super Soil Systems (a new method for treating hog wastes).

They conclude that hidden economic opportunities exist within the supply chains that provide parts and labor for these five industries. The report includes a snapshot of the opportunities for U.S. manufacturing jobs, with a detailed breakdown of the supply chains and maps highlighting the location of companies positioned to support green jobs. States that stand to benefit most from jobs in these sectors include Pennsylvania, Ohio, Indiana, North Carolina, New Mexico, Arizona, Nevada and California.

“Meeting the challenge of climate change will ramp up the supply chains that wind their way through the heart of American manufacturing,” said Jackie Roberts, director of sustainable technology at the Environmental Defense Fund (EDF), one of the report’s sponsors. “It’s concrete evidence of the link between U.S. jobs and climate solutions.”

“While some seek to pit the environment against economic growth, we see economic opportunity in the solutions to the climate crisis,” added Bob Baugh, executive director of the AFL-CIO Industrial Union Council, another one of the report’s sponsors. “But, to succeed it means making certain that, from production to construction, these green investments are made in the U.S. That is the best way to assure that their positive ripple effects are felt throughout the entire economy.”

“This report shows that each climate solution creates significant positive ripple effects throughout the economy in the labor and materials needed to supply low carbon technologies and products,” said Abraham Breehey, director of legislative affairs for the International Brotherhood of Boilermakers, also a report co-sponsor. “It demonstrates the real economic opportunity in the solutions to the climate crisis.”

The report was sponsored by Environmental Defense Fund, the Building and Construction Trades Department (AFL-CIO), Industrial Union Council (AFL-CIO), International Brotherhood of Boilermakers, and United Association of Plumbers and Pipefitters.

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Duke University: A Rescue Plan for Main Street, not Just Wall Street

By Andrew Foster
Duke University
Associate Clinical Professor of Law

Amid the headlines about huge stock market losses and collapses in the financial services sector, it can be easy to forget the human face of the problem that our nation now confronts.

As the federal government debates whether to give the U.S. Treasury Department unprecedented authority to spend up to $700 billion to bailout big banks, sophisticated investors and giant insurers, it is critical that a more strategic intervention be employed to address the housing and credit crises comprehensively and with fundamental fairness.

There is no question that a rescue plan is needed to strengthen many U.S. financial institutions and to shore up the economy. At the same time, policymakers cannot ignore the nearly five million American families who are either delinquent on their mortgages or are in foreclosure. Certainly, some of these consumers may have been irresponsible in taking on more debt than they could handle. The vast majority, however, were simply trying to buy a piece of the American Dream. Instead of building wealth and enjoying the security of homeownership, they now find themselves trapped in a nightmare of predatory debt and foreclosure.

Before Congress authorizes hundreds of billions of taxpayer dollars to save Wall Street from the crisis it created, steps need to be taken to rescue American homeowners, as well as the communities across the country being devastated by high rates of foreclosures. To achieve these goals, any final rescue plan should incorporate three basic elements that are now absent from the bill under consideration.

First, it must create mechanisms through which problem loans can be modified so that homeowners can stay in their homes. This can be achieved, in part, through federal intervention similar to the Home Owners Loan Corporation in the 1930s to help our country through a similar crisis. That corporation acquired problem mortgages directly from banks, and then modified them so that people who were in default could keep their homes. To achieve a similar goal today, the government will need to purchase whole loan pools -- not just the “slices” of loans typically incorporated into mortgage-backed securities -- so it can modify the terms of predatory mortgage loans and stave off another wave of defaults and foreclosures.

Federal bankruptcy law also must be revised so that, where appropriate, judges have limited authority to modify mortgage loans through the Chapter 13 bankruptcy process.

By taking these steps, the government can prevent an estimated additional 600,000 foreclosures. In addition to bringing needed relief to millions of Americans, this should help stop the devaluation of home prices.

Second, the plan needs to begin to re-establish effective regulation of the financial services industry. Though more will need to be done over time, two immediate steps can be taken. The Homeownership Preservation and Prevention Act of 2007, which has been before Congress for more than a year, should be immediately passed to address the pervasive problem of predatory lending. Drafted by Sen. Christopher Dodd, the legislation will help eliminate many of the abusive lending practices that led to this crisis.

Additionally, the Community Reinvestment Act (CRA), a federal law that requires commercial banks to make credit broadly available in a manner consistent with safety and soundness guidelines, should be extended to mortgage brokers, investment banks and insurance companies. This will enable government regulators to ensure that credit continues to flow to low- and moderate-income communities, but in a responsible manner.

Third, the rescue needs to be structured so as not to create a windfall for Wall Street. At a minimum, this will require that Treasury establish clear maximum prices that it will pay for the mortgage-backed securities clogging the system, that these purchases be conducted through a transparent process and that Congress maintain oversight of Treasury’s actions in this area. In no event should taxpayer funds be used to overpay for these devalued assets.

Finally, it should be beyond debate that any rescue plan must include provisions that limit the compensation of the managers of firms that receive governmental assistance.

There are no easy answers to the economic problems we now face as a country. In order to begin to address these systemic challenges fairly, however, we must ensure that any plan coming out of Washington puts as much focus on rescuing those of us living on Main Street as it does on helping those of us working on Wall Street. It is only by addressing both ends of the crisis that we have any hope of solving it.

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Duke: Treasury Action Should Work, But at High Cost to Taxpayers, Professor Says

The Treasury’s proposed action to use government money to purchase mortgage-backed securities held by financial institutions should work, but at an unnecessary cost to taxpayers, says Steven Schwarcz, the Stanley A. Star Professor of Law & Business at Duke University.

Schwarcz has studied systemic risk for more than a year and has suggested, in congressional testimony last October, that the government should consider acting as a market liquidity provider of last resort, but to do so at the outset of a financial market panic. His article, “Systemic Risk,” will be published next month in the Georgetown Law Journal.

“The focus from the outset should have been on treating loss of confidence in the financial markets, which is the underlying cause of problems in the financial system,” Schwarcz says. “While it may have been necessary under the circumstances for the Fed to act to prop up AIG and Bear Stearns, among others, preventing financial institution failure amounts to treating symptoms of the disease, not its underlying cause. By delaying, the government missed a vital opportunity to nip the problem in the bud at a much lower cost to the American taxpayer.”

The Treasury’s proposed bailout plan is a semi-strong version of Schwarcz’s proposal, which he said would work most effectively if used at the outset of a market panic. The current panic has become so entrenched, however, that financial institutions now distrust the creditworthiness of other financial institutions; they do not know how much in mortgage-backed securities those institutions hold or the value of those securities.

The Treasury, therefore, needs to address both this counterparty risk perception and the market collapse. It is proposing that government money be used to purchase, at a deep discount, mortgage-backed securities held by financial institutions, which would stabilize market prices and reduce counterparty risk.

'This should work," says Schwarcz, "but it will be much more expensive than if the government had stabilized the market at an earlier point."

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Household Health Largely Immune to National Economic Shocks, Study Finds

GFP Note: This is an interesting find. There is another article out today which suggests that Americans' sense of well being correlates with the rise and fall of the price of gasoline. Price goes up, wellbeing drops and vice versa. You can check out the other article on the Fayette Front Page under the Fayette Fitness and Health Blog.

When a national financial crisis strikes, ordinary citizens are adept at mitigating its effects on their health and long-term well-being by adapting their household spending, according to a study by researchers at the Motu Economic and Public Policy Research institute in New Zealand and Duke University.

The study, “Nutritional Status during an Economic Crisis: Evidence from Russia,” was published online Tuesday, Aug. 19, 2008, in The Economic Journal. The findings have implications for how governments and international donors respond to large-scale shocks, such as financial crises, said the study’s authors, Steven Stillman, a senior fellow at Motu Research, and Duncan Thomas, a Duke economics professor.

“If there is a major economic crisis, policymakers are under pressure to respond. The appropriate immediate response is not necessarily to blanket the entire country with resources, be it income or subsidized food, but to target resources to those people who need them the most,” Stillman said. “Apparently, the average person is able to do quite well in the face of economic shocks that are relatively short-lived.”

In their study, Stillman and Thomas examine patterns of spending and food consumption among Russians between 1996 and 2000 using population-based data on about 18,000 people interviewed in the Russia Longitudinal Monitoring Survey. From 1996 to 1998, economic turmoil sent average Russian household incomes plummeting 40 percent; incomes more than fully rebounded by 2000.

The researchers found that while household spending on food declined then rose in line with income, the average family’s intake of calories changed little during the four years. Families accomplished this by relying more on lower-cost, higher-calorie foods during economically difficult times.

“Quantities of starches and dairy are essentially unchanged across the entire sample period. In contrast, fruit and vegetables consumption appears to have adjusted entirely (to income variation) in terms of quantities,” the researchers explained in their paper. “In the case of meat, however, the picture is more nuanced: expenditures declined throughout the 1990s with a large decline in 1998; in 2000, expenditures rose but remained below their level in the mid-1990s.”

The study also looked at adult weight and child height as indicators of nutrition, and found that they changed little in response to income variation.

“Overall, the evidence suggests that individuals and households are very resilient -- even in the face of major economic upheavals -- and that they optimize over many dimensions of well-being,” the study concludes.

“The kind of household adaptability we find in the emerging economy of Russia could be applied to more advanced (nations) and to developing nations as well,” Thomas said. “We would expect American households to make similar lifestyle changes in response to rising gas and food prices and we have seen similar responses to the Asian economic crisis by Indonesian families.”

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Ward And Team USA Win Bronze Medal In Team Sabre Competition

Incoming Duke freshman Rebecca Ward and USA teammates Sada Jacobson and Mariel Zagunis defeated France 45-38 to win the bronze medal in the team sabre competition at the 2008 Summer Olympics on Thursday in the Fencing Hall at the National Convention Centre.

Ward, who will enroll at Duke in the fall, earned her second bronze medal at the 2008 summer games after claiming the bronze in the individual sabre competition behind teammates Jacobson and Zagunis on Saturday, August 9. Ward won six of her nine bouts in the team competition, including two of three in the bronze medal round. Fifth-seeded Ukraine took home the gold, while third-seeded China claimed the silver medal.

Ward won the opening bout in Thursday’s medal round 5-2 over France’s Mary Solenn and followed with an 8-2 triumph over Carole Vergne that erased a 20-17 deficit and put the US squad ahead 25-22. The American trio did not trail for the remainder of the round and led by as much as eight points at 40-32 before Ward locked up the bronze medal by holding off Leonore Perrus 5-6 in the final bout. Ward’s 8-2 victory over Vergne was the most lopsided victory in the round.

Ward, Jacobson and Zagunis – who collectively drew the number one seed in the team competition – opened their medal run with a commanding 45-8 win over eighth-seeded South Africa in the quarterfinals before falling 45-39 to Ukraine in the semifinals. Ward won each of her first three bouts against South Africa and gave up just two touches in the quarterfinals, defeating Adele Du Plooy 5-1 and Elvira Wood 5-1 before shutting out Joyti Chetty 5-0.

The Ukrainians handed Ward and team USA their first loss in the semifinals and advanced to the gold medal round where they edged China 45-44 to clinch the gold medal. Ward managed to pull out a 6-5 win over Olena Khomrova in the semis after falling 6-4 to Halyna Pundyk and 6-2 to Olga Kharlan.

The bronze medal finish concludes Ward’s stay in Beijing. She will join the Duke women’s fencing team this fall as a member of the sabre team.

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