by Zachary Rybarczyk
Scaling up energy efficiency retrofits around the U.S. could save an estimated $1 trillion over the next 10 years while creating 3.3 million job years for a wide range of skilled workers, according to study released this week from Deutsche Bank and the Rockefeller Foundation.
The study, “United States Building Energy Efficiency Retrofits,” calculates the massive economic impact a $279 billion investment in energy efficiency would have. Along with saving consumers money and boosting economic productivity, the investment would also reduce carbon dioxide emissions by 600 million metric tons — or about 10% of current emissions.
Here’s a run-down of the impact in each sector:
The majority of economic savings, GHG reductions, and direct and indirect “job years” would be created in the residential sector. Analysts at Deutsche Bank and the Rockefeller Foundation estimate that residential building stock could be made 30% more efficient by retrofitting all buildings built before 1980.
So how to get there?
Deutsche Bank also explores financing models that could facilitate the expansion of energy efficiency retrofits at such a massive scale. Here’s a great summary of some of the top models currently being used in the U.S. (click on graph to enlarge):
- Over the past few years, there have been new emerging financing structures, such as Energy Service Agreements (ESAs), Property Assessed Clean Energy (PACE), and On-Bill-Finance options, which offer significant potential to address historical barriers and achieve scale across the different market segments.
- These provide additional options beyond Energy Service Companies (ESCOs), which operate primarily in government markets (which include both commercial and institutional segments).
- PACE has potential as a model for all segments, but it requires significant regulatory support and acceptance from the mortgage industry. On-Bill Finance could be utilized with enabling regulation or used as a mechanism to enhance other financing models across the three building market segments.
While the report authors conclude that the market will continue to scale without additional changes in policy, they recommend a focus on stronger local policies and regulations that will “dramatically speed this process.”