Lighting the Way: Toward a Sustainable Energy Future

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  • 2.3 The buildings sector

    Global consumption of primary energy to provide heating, cooling, lighting, and other building-related energy services grew from 86 exajoules in 1971 to 165 exajoules in 2002—an average annual growth rate of 2.2 percent per year (Price and others, 2006). Energy demand for commercial buildings grew about 50 percent faster than for residential buildings during the period. Energy use in buildings has also grown considerably faster in developing countries than in industrialized countries over the last three decades: the annual average growth rate for developing countries was 2.9 percent from 1971 to 2002, compared to 1.4 percent for industrialized countries. Overall, 38 percent of all primary energy consumption (not counting traditional biomass) is used globally to supply energy services in buildings.

    Energy demand in buildings is driven by population growth, the addition of new energy-using equipment, building and appliance characteristics, climatic conditions, and behavioral factors. The rapid urbanization that is occurring in many developing countries has important implications for energy consumption in the building sector. Most of the population growth that is projected to occur worldwide over the next quarter century is expected to occur in urban areas. And as millions of apartments and houses are added to accommodate a growing population, they in turn create new demand for energy to power lights, appliances, and heating and cooling systems. Structural changes in the economy, such as the expansion of the service sector, can produce more rapid demand growth in the commercial buildings sector.

    It is important to make a distinction between what can be achieved in individual buildings and what can be achieved for the buildings sector as a whole in a given country. In the case of individual buildings, very large energy savings are possible and have been demonstrated. Numerous examples exist where heating energy use has been reduced to less than 10 percent of the average for the existing building stock through such measures as high insulation, passive solar design, low infiltration, measures to reduce heating and cooling loads, as well as efficient heating and cooling systems (Havey, 2006). Building designs that result in very low energy consumption are becoming the norm for new construction, such as in Germany and Austria, with ‘passive houses’ that rely on renewable energy sources and consume little or no outside energy close behind. Recently, there has even been discussion of so-called ‘energy-plus houses’ that could actually deliver power back to the grid. If these advances prove broadly transferable, they could create substantial new opportunities for promoting sustainability objectives, especially in settings where the building stock is expanding rapidly. Similarly, appliances are available that use 50 percent less energy than typical appliances. Obtaining large energy reductions in residential buildings generally does not require special expertise; the more complex systems in large commercial buildings, by contrast, place greater demands on designers, engineers, and building operators.

    In any case, maximizing the energy efficiency of buildings is a complex undertaking that requires a high degree of integration in architecture, design, construction, and building systems and materials. For this reason, the best results are generally achievable in new buildings where energy and ecological considerations can be incorporated from the ground up. In countries with a rapidly expanding building stock, it may therefore make sense to introduce differential policies specifically targeted to new construction. In many industrialized countries, on the other hand, the population of existing buildings is far larger than the number of new buildings added each year. Creative policies may be needed to capture cost-effective retrofit opportunities in these buildings given the different deployment hurdles and typically higher costs that apply. Achieving a broad transformation of the building stock in different contexts will require that the technologies, human-skills, financial incentives, and regulatory requirements needed to capture efficiency opportunities in new and existing structures are widely disseminated.

    Residential buildings
    It is difficult to compare the energy performance of buildings in different countries because of data limitations (related to energy use at the end-use level), climate variations, and different construction practices that are not quantified. The best data source for an inter-comparison of European countries, the IEA covers 11 of its highest energy-using members. The IEA data indicate that appliances and lighting account for 22 percent of total household energy consumption on an end-use basis and approximately 32 percent of primary energy consumption (that is, taking into account primary energy consumption to generate electricity). Space heating accounts for the largest share of energy consumption in residential buildings: about 40 percent of total primary energy demand (IEA, 2004b).

    Potential for efficiency improvements in space heating and cooling for residential buildings has several options, including the following:

      * using more efficient heating and cooling equipment,
      * increasing thermal insulation,
      * using passive solar techniques to collect heat,
      * reducing infiltration of outside air or losses of conditioned air to unconditioned space,
      * using more efficient thermal distribution systems,
      * using active solar collectors,
      * and changing behavior (e.g., temperature set points).

    In some countries, more efficient heating and cooling systems have been mandated through building codes or appliance standards. At the same time, improved construction practices and building energy standards—that led to multiple glazings, higher insulation levels, and reduced air infiltration—have reduced per-square-foot heating, ventilation, and air conditioning loads in new buildings in many countries around the world. In some instances, the addition of low-tech options, such as ceiling fans, can be used to reduce air conditioning requirements. And in a few cases, policies have been introduced to reduce building energy consumption through behavioral changes. To reduce air conditioning loads, for example, some Chinese cities have adopted regulations that prohibit residents from setting thermostats below 26 degrees Celsius during the summertime.

    Appliances are the second major contributor to energy demand in residential buildings. The evolution of refrigerator technology in the United States represents a major energy-efficiency success story. Figure 2.3 shows trends in average refrigerator energy use, price, and volume in the United States over the last half century. The peak of electricity use occurred in the middle 1970s. Thereafter, as the State of California set efficiency standards


















    Figure 2.3 Refrigerator energy use in the United States over time

    Source: David Goldstein, Natural Resources Defense Council

    and as the U.S. Congress debated setting a federal standard, energy use in refrigerators began to decline very significantly. Efficiency improvements were realized using available technologies: improved insulation (using blowing agents), better compressors, and improved seals and gaskets. The industry did not need to develop new refrigerants to achieve these gains. Average refrigerator energy consumption declined dramatically in the late 1970s in anticipation of the California standards; federal standards, when they were introduced several years later, were more stringent than the California standards. Throughout this period, the size of new refrigerators increased, but their price fell.

    The changes in energy consumption depicted in Figure 2.3 are significant. The annual electricity consumption of the average refrigerator declined from 1,800 kilowatt-hours per year to 450 kilowatt-hours per year between 1977 and 2002, even as volume increased by more than 20 percent and prices declined by more than 60 percent. It has been estimated that the value of U.S. energy savings from 150 million refrigerators and freezers were close to US$17 billion annually.

    The potential to reduce energy consumption by other household appliances, though not as dramatic as in the case of refrigerators, is nonetheless substantial. Horizontal-axis clothes-washing machines, for example, require substantially less water and energy than vertical-axis machines. Homes and commercial buildings now have a large and growing number of ‘miscellaneous’ energy-using devices, such as televisions, other audiovisual equipment, computers, printers, and battery chargers. Many of these devices use—and waste—significant amounts of power when in standby mode; in fact, standby losses from miscellaneous electronic equipment have been estimated to account for 3–13 percent of residential electricity use in OECD countries. In many cases, significant energy savings could be achieved by redesigning these types of devices so as to minimize standby losses.22

    Commercial buildings
    The two most important sources of energy demand in U.S. commercial buildings, as illustrated in Figure 2.4, are space heating, ventilation, and air conditioning (HVAC) systems, which account for 31 percent of total













    Figure 2.4 Shares of primary energy use in U.S. commercial buildings

    Note: Total energy consumption: 17.49 quadrillion British thermal units (equal to 18.45 EJ). Building energy consumption in the industrial sector is excluded. The portion of Figure 2.4 labeled Adjustment to SEDS (State Energy Data Systems) represents uncertainty in the numbers shown. Data from 2003.

    Source: USDOE, 2005.

    building primary energy use; and lighting, which accounts for 24 percent of total building primary energy use. The results for large commercial buildings in many other countries are thought to be similar to those for the United States, although no such statistical breakdown is available for other IEA member nations or for the developing world, The term ‘commercial buildings’ covers a wide range of structures, including government buildings, commercial office buildings, schools, hospitals, houses of worship, shops, warehouses, restaurants, and entertainment venues.

    Large energy-saving opportunities exist in the commercial-building sector. In hot and humid climates, cooling loads can be reduced by addressing the building envelope—including window coatings and shading—and by employing energy-efficient lighting (which produces less waste heat). In many cases, low-technology options, such as incorporating traditional design features or painting flat rooftops white to increase their reflectivity, can produce substantial reductions in cooling loads. Building-integrated solar photovoltaics represent another option for reducing grid-electricity consumption in commercial buildings, among the points discussed in Chapter 3. And regardless of climate, more efficient equipment is available for all of the major commercial-building end-uses shown in Figure 2.4.

    The most significant efficiency opportunities for commercial buildings in the future involve system integration. An example is daylighting, in which sensors measure light entering the perimeter areas of a building and actuators control the level of artificial lighting. This can reduce lighting energy consumption in perimeter areas by 75 percent and produce additional savings by reducing cooling loads. Numerous studies and real-world applications have shown such daylighting systems to be highly cost-effective when evaluated on the basis of lifecycle costs (that is, taking into account operating cost savings over the life of the building as well as upfront capital cost). Because of their perceived complexity, however, they have had only limited penetration in the market.

    Inspecting all elements of a building to ensure that they are working properly—a process known as building commissioning—often produces large savings. Frequently, buildings are not constructed the way they were designed and commissioning can identify and rectify such problems, reducing energy consumption by 10–30 percent or more. Even where buildings are constructed as specified, commissioning can ‘tune up’ the HVAC systems. Still greater energy savings can be achieved in commercial buildings through ‘continuous commissioning’ which involves real-time monitoring of overall HVAC performance and all other building systems and adjusting system controls based on the monitoring results. Just as daylighting has been slow to gain commercial acceptance, the complexities of continuous commissioning will need to be overcome before it is widely adopted.

    Policies for promoting energy efficiency in buildings
    Many countries have adopted policies to promote energy efficiency in buildings; two of the most common are appliance efficiency standards and building energy codes. In some countries, utility companies have also played a major role in providing incentives, information, or technical assistance to promote end-use efficiency improvements. Finally, governments or financial institutions can provide financial incentives, including low– or mid-cost loans for energy-efficiency investments in both retrofit and original building construction projects. Loans at slightly below market value can stimulate increased use of energy-efficiency services providers, such as energy service companies (ESCO), and are likely to be particularly attractive when the builder/retrofitter is also the owner and operator of the building and thus stands to benefit from reduced energy costs over time. This is often the case for buildings owned by government, major corporations, universities, and other such large institutions.

    Appliance standards have been especially effective: they are relatively easy to enforce, usually involve only a small number of manufacturers, and produce energy savings without requiring consumers to spend time and effort to avoid purchasing an inefficient model. To produce continued technology improvements and efficiency gains, however, appliance standards must be rigorous and must be updated periodically. Building codes are important since they have an effect on the overall, lifetime energy consumption of structures that will last many decades. For building codes to succeed, however, building designers and builders must be educated and requirements must be enforced. Other types of programs, such as utility demand-side management or Japan’s Top Runner, can serve as an important complement to building codes and appliance standards by providing incentives for further efficiency gains beyond the minimums established via mandatory standards.

    Box 2.1 Japan’s Top Runner Program

    In 1999, Japan introduced an innovative addition to its existing Energy Conservation Law. The Top Runner Program is designed to promote ongoing efficiency improvements in appliances, machinery, and equipment used in the residential, commercial and transportation sectors.

    This is how the program works. Committees composed of representatives from industry, academia, trade unions, and consumer groups identify the most efficient model currently on the market in a particular product category. The energy performance of this ‘top runner ’ model is used to set a target for all manufacturers to achieve within the next four to eight years. To meet the target, manufacturers must ensure that the weighted average efficiency of all the models they offer in the same product category meet the top runner standard. In this way, the program offers more flexibility than minimum efficiency standards for all products: manufacturers can still sell less efficient models, provided they more than compensate with higher efficiency in other models. By continually resetting targets based on bestin- class performance, this approach to benchmarking progressively raises the bar for average efficiency performance. Although manufacturers are only obliged to ‘make efforts ’ to reach the target, the Top Runner Program has achieved good results in Japan. The government’s chief leverage lies in its ability to publicize a company’s failure to meet the targets, or to make a good faith effort to meet targets, which in turn would put a company’s brand image at risk. Typically, the targets set in different product categories are indexed to other product attributes (such as vehicle weight, screen size in the case of a television, or power in the case of an air conditioner). In some cases additional categories have been created to accommodate certain product functions that may not be cost-effective in combination with the most advanced efficiency features or to reflect price distinctions (e.g., one target for low-cost, high-efficiency models and a separate target for high-cost, high-efficiency models). This additional flexibility is designed to ensure that consumers retain a wide range of choices.

    Japan’s Top Runner Program includes a consumer information component, in the form of a labeling system. Individual product models that do not meet the target can remain on the market, but receive an orange label. Models that do meet the target receive a green label. For more information, see Energy Conservation Center, Japan, website: