Ep68: Amory Lovins 'The Einstein of Energy Efficiency'

Michael Liebreich: Before we start, if you're enjoying these conversations, please make sure that you like or subscribe to Cleaning Up, it really helps other people to find us. Cleaning Up is brought to you by the Liebreich Foundation and the Gilardini Foundation. Hello, I'm Michael Liebreich and this is Cleaning Up. My guest today is Amory Lovins, he is the co-founder and chairman emeritus of the Rocky Mountain Institute, an Adjunct Professor in Civil and Environmental Engineering at Stanford University. He has authored 31 books and over 700 papers, he's advised 70 governments, and he's been awarded 10 honorary doctorates over the past 45 years. Let's bring Amory Levin's into the conversation. So, Amory, welcome to Cleaning Up.

Amory Lovins: Thanks for having me.

ML: It's always a very great pleasure to see you. Where are you calling from today?

AL: From my home office and indoor passive solar banana farm, 2200 meters up in the Rockies near Aspen. And you can see, let's see over on the very far left, just the remains of a banana crop we're harvesting at the moment number 78, yellow, hello, yellow, banana phone doesn't always work, right. But the crops 79,80 behind that there's no heating system, it's cheaper to build that way.

ML: So you designed and built this property, and it's in the mountains, because you went really fast, you always do. And I'm going to slow everything down a little bit for our audience so that they can keep up. And so you you're at 2200 meters. So how many feet is that?

AL: 7100 feet, and that goes used to go as low as minus 44 Celsius minus 47 Fahrenheit.

ML: Right. And so you design a home, it has no heating, and you're growing bananas. Is that correct?

AL: Yeah. 100 other kinds of higher plants. And the reason it's cheaper to build that way, is that you save more construction costs, not needing a heating system, and all the kit that goes with it, then you pay extra for the super insulation, super windows, ventilation, heat recovery that got rid of the heating system.

ML: Now you have a history of doing this stuff, I mean, there’s one interesting point now already, which is that you're a doer, you actually walk the walk, you didn't just write the paper, which you did, but you also built the house. And the big paper that kind of got everybody's attention, “The Road Less Travelled” in 1976. I got the title wrong, what was the tittle?

AL: Energy Strategy: The Road Not Taken.

ML: Road Not Taken. I'm doing too much poetry too little engineering here. So it's “The Road Not Taken? And was that? Would you consider that the beginning of the sort your journey or it was it? Was that an important mark for you? Because it certainly was for me when I read it.

AL: Yeah, I think it was for a lot of people because it reframed the energy problem. I'd been getting into energy before that my first professional paper on climate change for example was in 1968. But in the Foreign Affairs paper in 76. I showed that the classic way of thinking about what is the energy problem, namely, where do we find more energy, more of any kind from any source at any price wasn't leading in a good direction. It would, it would be too expensive, too unpleasant, too slow, too difficult. But we should instead start at the other end of the problem with the end users, what do we want the energy for? We want hot showers, cold beer, big bread, smelted aluminium, mobility, comfort, and for each of those services, each end use, how much energy of what kind or quality of what size from what source, we do the job in the cheapest way. This was rather a revolutionary idea. And there followed a year of intense debate. And when the dust settled, David Sternlight who was Chief Economist of Arco, kind of summed it up by saying I don't I for one, don't care if Lovins is only half right, that would be better performance than I seen from the rest of them. And then the firms that had been most critical started hiring us to help them do what we described, which was basically efficiency and appropriate renewables and a transition path to deploy all that. But in those days, efficiency was viewed with great skepticism. A lot of people who should have done better said if you try to save energy, we'll be back to caves and candles. It's quite amazing what they said because they assume we and everybody else in the world has a free market economy. And those are, of course, perfect. So, all efficiency worth doing has already been bought. And in those days supply was in quite a primitive state. Some rather odd people thought you might be able to make when machines compete. But that was great with great skepticism. And although there was some solar power up on satellites, the notion we could cut the cost a 1000 fold, and use them on Earth was just unmentionable. So, when people said solar, they meant solar water heaters on your roof.

ML: Right. Now, I associate that I should point out, by the way that that paper in 1976, you wrote that when I was 13, and I'm a geek, I'm a wonk, but I'm not that much of a wonk. I only really came to that much, much later. Because I studied energy. And I studied the sort of energy choices that you were sort of setting out your stall again. So, I studied mechanical engineering, and I studied nuclear power. And what I know we're going to have to get back and cover that as well. So, I did very conventional energy technologies, I went off and became a ski bum. And so, I didn't kind of get back to energy until 2003. Really, when I started to get back into it. And by that time, a lot of your thoughts had percolated through, but not they weren't yet the received wisdom. They were not yet. I mean, the old energy system was still very much in the driving seat. You know, there was a big debate about peak oil that was about as intellectual as it got. But the idea that there was this up these other things that one could do, and I discovered it then as I started to do my early research for New Energy Finance, I discovered your seminal paper, and thought, yeah, that sounds that sounds pretty convincing. So, you convinced me, you played a big role in in starting New Energy Finance.

AL: Oh, good. It's it certainly turned out well for all of us. It's a wonderful thing you've done. But I think now we're in another kind of revolution. And it's not only on the supply side, where most of the attention is, in take this house as an example. It's saving 99% of the space and water heating energy, about 90% of the electricity, half the water all with a 10-month payback with 1983 technologies, today's are much better and cheaper. And it applies practically anywhere. Soon after we moved in an architecture professor from Bangkok showed up and said, Well, I've got a hot, wet climate, not a cold, dry climate, but I'm about to build a house and let's see if I can do what you did in optimizing the whole building as a system for multiple benefits. From single expenditures like this arch, you can see above my head has 12 functions, but only one cost. So, we went back and did that I later visited him. He was saving 90% of his air conditioning energy. Normal construction costs, better comfort. Well, just about everybody in the world lives in a climate between his and mine. Now buildings use three fourths of US electricity. Most of the oil of course goes to transport so out of the driveway I've got a carbon fiber electric automobile, my first hypercar concept we came up with in 91. And it's about four times normal efficiency, 124 miles per gallon equivalent 53 kilometres per litre. You could do the math, but 1.9 or 1.7 litres per 100 kilometres. But at a very competitive cost, which surprised everybody because carbon fibre is so expensive it was thought to be just for handmade racecars? Well, it turns out, if you make the car out of carbon fibre, you also save two thirds of the investment in water and half the energy space and time needed to put the car together. And it needs a lot fewer batteries because it's holding less weight because the carbon fibre is light. So, we paid for the carbon fibre, or BMW did in this case that we had claimed this in the 90s and they validated it. You pay for the carbon fibre by needing fewer batteries and smaller propulsion system all round. And it's easier and cheaper to make. So, another example of what we call integrative design, whole system design. And it turns out to apply in every sector practically every application. I teach this stuff at Stanford and we're just drowning in great examples from all over the economy and all over the world.

ML: And just to clarify when you say the BMW is that the BMW i3, the first car to have a carbon fibre frame.

AL:  In volume production. They've sold over 200,000 of them. And it was it's very popular of course there, they'll just continue it in Europe in 2023. It’s got a good run 11 years because they need the production space to make other stuff that's far more lucrative, I like it for a lot of other reasons, including half normal turn radius. So, it's very agile, like a little cutting horse very good in the city.

ML: At this point, I probably shouldn't admit that I'm still driving a 4.4 litre petrol SUV with the turning circle of a London bus. And the reason I do that is because it's seven seats and I have to go up and down very steep, very icy tracks and there is no seven seater EV as yet but I already I can see your mind going there.

AL: I think you get a seven seat Tesla, actually.

ML: You can but you know what? You can't put skis on the roof because it has gullwing doors one of the stupidest design decisions ever, in my view.

AL: Oh that was a bit of interest. Anyway.

ML: I can see your mind. But what I want to come back to that is this, you call it into integrative design. And so you know if I sort of summarize, I can paraphrase. My sense of where you're going with this is what you're doing is thinking deeply at the design stage. And maybe spending a little bit more on the costs of production, although maybe not because actually becomes so light and so much, there's eliminating parts at the same time. But you're definitely on a whole life basis, saving an enormous amount of resources and energy and water and space and all these other things. I mean, is that a fair characterization of what you're talking about?

AL: Yeah, so if you do this across the whole economy, really designing whole systems in factories, equipment, buildings, vehicles, you'll end up with several fold larger energy savings, than practically anyone now thinks is available. And the cost goes down. I'll give you another example from industry because the industry is about half the world's energy and electricity. About half the world's electricity runs motors, half the motor power runs, pumps and fans. Out of the pumps come pipes, out of the fans come ducts, and people don't tend to pay quite as much attention to those. Well, it turns out, the friction in a pipe, for example, goes down is nearly the fifth power of its diameter. But the cost goes up is only about the second power of diameter. So, you can use fatter pipes. And then the pump the motor get much smaller, how much oh about 80 or 90% smaller, get a factor of five or 10 shrinkage on all that expensive equipment. And, in fact, in our house, just we save 97% of the pumping energy by properly laying out some pipes so that they're fat, short and straight rather than skinny, long and crooked. Well, if everyone in the world did that to their pipes and ducts, you would save about a fifth of the world's electricity, or half the coal fired electricity. And you get your money back instantly in new build or in under a year typically in retrofits in buildings and industry. And yet this is not in any standard engineering textbook, not in any course I know of except mine at Stanford. And it's certainly not in any industry, forecast, government study or climate model. Why not? Because it's not a technology. It's a bloody design method. Most people don't yet think of design as a scaling vector or a way to make things big fast. So my mission is to spread this round and mobilise an army of practitioners, tradespeople, teachers and students to try to make integrative design the standard practice because that will make the supply investments a great deal smaller, cheaper and faster.

ML: So I'm smiling as you were talking about the shorter, fatter, bigger, straighter pipes, because in 1992, I did some work in the cheese industry in Germany in a factory that was and you would have, absolutely you'd be just shaking your head. They were moving around processed cheese, they were squeezing it through long, skinny pipes with right angles and around the factory in order to sort of take it from where they were melting it and making it to where they were, you know packaging. I kid you not, when they pumped the lights went dim.

AL: Peter Rumsey was retrofitting some equipment at the Oakland Museum, he asked the pipe fitters to lay out the pipes as if they were drains, because in another part of their brain, the pipe fitters know that if you put a right angle and a drain, which runs only on gravity, not pumping, it'll clog. So we need to bend minds, not pipes. And the key here is what in Asian philosophy is called beginner's mind, original mind, child mind, you need to put aside your assumptions and preconceptions forget what what they taught you in trade school, about laying out pipes that need right angles. So the pipes crossing the room are three to six times the friction they should have had. This is a good way to charge more because there's more labour and more parts. But it's not good for your customer who wants to save energy and investment, and can indeed cut the pumping energy. And well about a factor of five or 10. And the investment similarly, of course, the savings cascade because, well, we know for example, International Energy Agency and others talk about mainly two things you do to motor systems to save about a fourth of their energy. Well, if you do 35 things to motor systems, you save upwards of half the energy, and you get your money back several times faster. But if you do the pipes and ducts, friction reduction first, then the pumps and fans and their motors and electronics get five or 10 times smaller. So that's a good time to fix up the motor system and do all 35 things. And the reason that's a lot better deal is that you only pay for seven and the other 28 are free byproducts if you do the right things in the right order. So then you end up with fat pipes, little tiny pumps and motors. Looks like a decimal point error but it's not. Your total investment goes way down. And then you have money left to do other stuff.

ML: So I am working with a bunch of plumbers. When I say working with I'm trying to amplify the messages coming out of a bunch of very, very good heating engineers. So there's a podcast called Beta Teach. And it's all about how you get lower carbon heating systems in homes. And, you know, the refrain is always that the fitters and the engineers no longer have the skills to design. So, for instance, in the UK at least, there's an absolute dearth of people who can do a heat loss calculation for a home, they're just used to sticking a great big boiler on the wall combi boiler and then and not setting it up correctly setting it up so it doesn't even condense. And then on to the next job. And so I'm going to have to point them to this idea of shorter, fatter, straighter pipes.

AL: Oh, but better if you design out the pipes, though, by putting a tea cosy around the house, like the Dutch Energiesproing exterior retrofit of what's what you call outsolation, as opposed to insulation. And actually, in the UK, it's been demonstrated, they can super insulate your house to net zero standard in a single day whilst you're off at work. And meanwhile, they've dropped in a very efficient heat pump core for mechanicals, and put on a super insulated solar roof. And when you get back, you pay them rather than your energy companies. And they're already about at the point of industrializing this and scaling it where you can get to net zero without subsidy that is paid for by the energy savings over the years.

ML: In certain homes, I mean, there's a lot of there's a lot of homes where it's very difficult to because they actually turn up, they actually come up with a, I don't know if it's 3D printed, but a complete sort of facade, and kind of stick it onto the outside of the home.

AL: Yeah, it's factory fabricated. And it's made of insulated panels.

ML: Yeah. So I mean, when it when it works, I think it works really great. But the I would have about the integrative design is you came up with as you started on this route in 1976, but it's not universal yet. So that's 45, 47 years later.

AL: In fact, it’s very rare.

ML: My worry is you've got a process where you kind of have to get the design right, up front. I mean, we talked about renovations by each product, and then by the time we're doing a renovation, it's already much, much harder. So, you've got 47 years, and we're still not building this approach in at the beginning of product design, home design, car design, you know, factory design, as on so I mean, I could throw this all back at you and go well, okay, so Amory what's going wrong? If it's so obvious, and you think it is, and I'm big disciple, right? Why is it not happening?

AL: Well, there are 60 or 80 obstacles to buying energy efficiency, including completely perverse incentives, like we pay our architects and engineers for what they spend, not what they save. Many utilities get rewarded for selling more energy not cutting your bill. People buying cars have such a high discount rate, that they only pay attention to the first year or two fuel saving. So, whether you get an efficient car as unimportant as whether you it has floor mats, and so on. Now, each of these 60 or 80 obstacles can be turned into a business opportunity. But the systems involved are quite complex. Like in commercial properties, there are about two dozen parties, each with perfectly perverse incentives, all speaking different languages using different metrics not talking to each other. And if you leave out one, that can be a showstopper. So that actually scaling the implementation in a complex system like that requires relentless patience, meticulous attention to detail. And there aren't enough of us doing it yet. We've had some great successes. But it's a big world. Now, of course, this is most important in countries like China and India that are building so much of their infrastructure. And as you say, it's much easier to build it right than fix it later. And some of those have centralized institutions that can change the rules and centralized methods of education, like the IIT system in India, that that can spread the word very quickly. Or you could have you could imagine an outfit like EESL in India that did such a brilliant job spreading LED lights everywhere and cutting the cost dramatically. You can imagine them perhaps getting designs spread out and not just technologies, but we have a lot of work to do. To be fair, I didn't think of integrative design in ’76, that came later. But yes, we've had a few decades at it. And I'm hoping now that I've got a position at Stanford to be able to put those lectures out on the likes of edX or YouTube to be free to the world by the millions. And also, to do scaling, for example, teaching wonderful Stanford students every year. It's not a scaling model, it's linear. But if I could teach the teachers and get many of the best design teachers in the world to share our experience, I think that might start to be a scaling model.

ML: So I'm I was a commissioner, the IEA had a commission on urgent, it was called the IEA High Level Commission on Urgent Energy Efficiency. And what we were trying to do was to increase the average rate of energy efficiency improvement, which has been about 1.6% per year to get that to 3%. and there was the 3% Club, where people are going to countries are committing to get to 3%. Well, the most recent results were that the 1.6% has now dropped to half a percent in the last…

AL: No, it's now back to 1.9, which is the past decades average. But we do need to double it or more.

ML: Well, that will put in the shownotes a link to the IEA. Its most recent, like yesterday, announcement of its energy efficiency report where the figure was definitely 0.5

AL:  Maybe it's the previous year.

ML: Maybe it's the previous year.

AL:It was it was it was half a percent in 2000. It's back to 1.9.

ML: That’s right. Now, but what's an intro, of course, we don't need to disagree at all it's not 3%. And it's not 4% or 5%, or 6%, which we need to be if you really want to get to, it really is going to do the heavy lifting that's required of energy efficiency for net zero. And we produce, this was 2019, we produced a perfectly wonderful report with case studies. It was the highest-level group of people that I've ever been on, it was great fun, because going around the room, it was kind of minister of this minister of minister of the other, and Michael Liebreich. And we essentially I don't want to say we bounced off the issue, but I don't think you could say that this was a, you know, historic moment where, you know, where we finally got serious about energy efficiency, it just seems to be a really intractable problem.

AL: Yeah, I actually wanted to talk to that group about integrative design, but it didn't happen.

ML: You should have pinged me an email and we could of, you know, help to make that happen. Yeah. I guess I don't know the answers. I'm not fishing for an answer. I'm just trying to get you know, the benefit of your… because you are a huge optimist. And uh, you know, you Well, I don't know you're very, you'll come across as enormously optimistic, very positive, you're convinced to the benefits of this and you're the champion. It will save you money, not cost money. Again, it's not happening.

AL:

It is happening just not fast enough. But the chap in the upper photo here, Dave Brower, greatest conservationist to the 20th century, one of my mentors said that optimism and pessimism are different sides of a simplistic surrender to fatalism where you treat the future as fate not choice and don't take responsibility for creating the future you want. So, I live instead in a spirit called applied hope, which is not mere optimism. It's choosing and doing things each day that create a world worth being hopeful about. Because hope is a sense of assessment…

ML:

Paul Romer talks about passive and active optimism. It's the optimism of a of a child waiting for a good Christmas present is passive, but a child looks at a tree and says I can build an amazing treehouse. That's your applied hope. Right? And I agree with that entirely. I guess I you know, I'm just looking for, you know, tips because I do get asked the question often, you know, how do we, you know, how do we accelerate on energy efficiency? And, you know, you talked about this myth that people think, you know, some people think energy efficiency means going back to the caves. There are also people who think that energy efficiency is pointless because of this wonderful thing called the Jevons Paradox. Whatever you do, you then go and spend that saving on more energy sucking energy demanding appliances or holidays or whatever.

AL: Or if you understand what you just did you spend it on more efficiency. There are about five layers of rebound as the generic term for what you're describing. And it is a real effect. It's a small effect. Except in the most rare pathological cases, it's a few percent effect. So yes, we count it in our analysis, but it doesn't significantly change the outcome. And there are a lot of simple ways to fix it. If it were a problem, which it's not. It's only a conceptual trap that some economist rediscovers every decade or so and thinks everybody missed it. No, it's a very well known effect. And, by the way, the only level on which it's real and significant is that energy efficiency is a significant macroeconomic stimulant. On the other hand, that doesn't mean you should blame the invention of steam engines and efficient motors, for economic growth, if you're an anti-growther, which many such critics are. Rather, you could make exactly the same case about the emancipation of women, public health, education and other things we've done changed the shape of the economy, change how society works. And I don't see why we should single out energy efficiency as a culprit in producing growth that some people don't want.

ML: One thing we can do is because we do have show notes that go with this talk, if there is a single fantastic article or source, either by yourself or by somebody who can verify that it's a few percent effect and it's not more than that. I would love it, because I tend to get people bringing up the Jevons Effect who people who have sort of anti-renewables, anti-energy efficiency, they're very much on the supply side, generally, frankly, they're, you know, that they're promoting nuclear power, because it seems kind of unlimited. And therefore, you don't try these other things you go for my secret silver bullet, is how I see the Jevons Paradox being played in the debate. So, if you can help to kill the Jevons paradox, that'd be very helpful.

AL: I'll send you a few things.

ML: Wonderful.

AL: The nuclear thing is such a distraction. You know, in 2020, the world added 0.4 gigawatts more nuclear capacity than it retired, whilst the world added 278 gigawatts of renewables, that's a 782 fold greater capacity. And if you correct for capacity factors by technology, US average 2020, then it's about 230 some times more annual production capability. And by the way, this year is shaping up even stronger, we'll probably end up with about minus three gigawatts of nuclear additions. And plus, IEA says 290 gigawatts of renewable additions. Game over.

ML: Right. So, what we've spoken about so far today has been the energy efficiency, the absolute value of you know, proper design, integrative design reduces the demand for the same energy services, the same utility in life. But then you switched, I perceive it as being switching to the supply side, you wrote this book called Reinventing Fire, which is all about the supply.

AL: No, no, it’s not all about supply, it integrates the two, that's the important bit. So, it showed how to triple efficiency and quintuple renewables in the US. And that would get you to 2050 at historically reasonable pace, needing no oil, no coal, no nuclear a lot less gas, saving $5 trillion, and running a 2.6 fold bigger economy with 82% to 86% less carbon.

ML: Okay, so I was sort of mischaracterizing and saying switching to the supply side, but you've now you know, rounded out the picture integrated the supply side. And the one area I mean, you know, there is one area where you and I tend to disagree, and it is around nuclear, where I'm very comfortable running the existing nuclear as long as it is safe. And my read of it is that there's plenty of safe nuclear power stations producing a lot of low carbon, cheap at the variable level nuclear power. And there's this enormous push originating largely out of Germany, but not only, to shut down even existing nuclear power stations, and to, in a sense forbid, work on either a new generation or the next generation. And, you know, when you come up with statistics, like how unsuccessful nuclear has been at building new capacity, there are those that would say, well, that's because how can I put it… that's because the Green movement has been so successful in demonizing this technology, you kind of make it impossible to build, and then say, ha, you see, you can't even build. And so, the debate is very fraught. And it is one where I think you and I don't share the same position.

AL: Oh, that's healthy. But as a student of this technology since 1963, I do indeed have a different view. And I, I think there's very strong evidence for it. The notion that it's the greenies that stopped this is frankly utter rubbish because exactly the same nuclear decline is observable with minor differences of detail in countries with utterly impotent regulators with public participation ineffectual or even legally prohibited. It's all around the world. And I think that the basic force behind the decline of nuclear power is that it has no business case, to take China as an example, because it's responsible for most of the current and planned nuclear growth in the world. Well, China in 2020 invested as much more or less in renewables as it had invested the previous 12 years combined in nuclear. The renewables outgenerated, actually just sun and wind out generated nuclear by a factor two, they added six times more output, they added 60 times more capacity in 2020. Why? Because they cost two or three times less, according to some outfit called Bloomberg New Energy Finance. So, again, even in the case, where nuclear is cheapest, renewables are cheaper still and efficiency cheaper than that. So, and by the way, there is no new type or size or fuel cycle of reactor that will change this. Just, you know, do the maths, indulge me for a moment. I think it's generally agreed among serious students of the subject that new small modular reactors are advanced reactors of whatever type will send out electricity, twice or more the costs of existing ones, which they hope then to reduce that difference by mass production. The existing ones, according to Bloomberg are about 5 to 13 times dearer per kilowatt hour than renewables, unsubsidized. And then those renewables, also, according to BNEF, will get another factor two cheaper by the time you could scale SMRs. Well, two times, like five to 13 times two is the factor, you know, up of several tens. And you're not going to bridge that gap of cost by mass production. In fact, even if the reactors were free, they couldn't compete because the non-nuclear kit, which in today's reactors is 78% to 87%, of the prohibitive capex is still too much. So, it's the small modular renewables, the other SMRs that are decades ahead in exploiting their formidable economies and production at scale, and nuclear can't catch up. The problem is then that when legislators become convinced that they should subsidize even more the operation of the existing reactors because they are, as you say, an existing source not burning fuel. They are compounding the capital misallocation that makes climate change worse. Why? Because the low operating costs you referred to average is three cents a kilowatt hour in the United States. And generally more in the rest of the world. I've reviewed that in detail a couple of years ago. It's more than efficiency by a factor typically two, three, often more, it's more than modern renewables. So, if you continue to operate the existing nuclear plants, even though they're carbon free in operation, you're not saving as much carbon as if you bought cheaper per kilowatt hour carbon free resources to replace them. And it's not as, as bad as making climate change worse as if you were to buy new reactors which are very far out of the money by an order of magnitude. But it's still not saving as much carbon per dollar or per year as you could, if you bought the most climate effective options first. And that's what we need to do. This mushy mantra of all of the above, substitute for thought and choice is particularly inappropriate if you're worried about climate because the worst climate change is, the more we need to invest judiciously, not indiscriminately, to buy the most climate effective options, those that save the most carbon per dollar and per year, nuclear is not that. You know, if you hear some official as one recently did say, we're in favor of all of the above, we're not picking and backing winners, Peter Bradford, the Dean of US Utility Regulation, retorted quite properly, no, you're not, we're not picking and choosing winners. They don't need it. We're picking and choosing losers.

ML: Well, I had a guest on this show, who was very into very much involved with the all of the above strategy back in the day, under President Obama, but I'm not going to name his name because it would be unfair, that I know who you're thinking of.

AL: But he would deserve it.

ML: But let me let me just push on this a little bit more. So, because I, I still fundamentally disagree with this idea that there's a limited amount of money. I mean, there's $400 trillion dollars out there in the world of capital formation. And we can walk and dry our fingernails at the same time, or walk and chew gum at the same time. I mean we do have enough cash. So, there's nothing to stop us running existing nuclear power stations, and also investing in wind and solar, which, you know, they have, and by the way, you know, batteries where we have supply constraints anyway, at the moment. And, you know, when you look at these electricity systems where they shut down nuclear, and you see the fossil fuel use, you know, soaring in subsequent years that may come down afterwards. But that's not the point. It's absolutely clear that prematurely shutting down nuclear drives up the fossil fuel use it drives…

AL: With great respect, Michael, I think we must be living on different data planets. Look, I know, well, for example, the Japanese and the German statistics, which show exactly the opposite of what you've just described, Germany has pulled off the wonderful trick of phasing out nuclear, they'll be done with that next year, they agreed to 20 years ago, and dramatically reducing fossil fuel and carbon at the same time. In Japan…

ML: We are slightly on a different data planet that because I look at the UK versus Germany. Sorry to interrupt. And you know, the UK, which has kept its nuclear, and, you know, implemented a lot of wind has dramatically outperformed Germany in reducing carbon emissions. Germany for many years was absolutely flat as it shut down its nuclear, its electricity, carbon intensity remain almost completely flat.

AL: Not since 2013, you've got to look at more recent data.

ML:

Take the view from 2005. And by the way, wait and add to your data when Germany shuts another three nuclear power stations on at the end of this year and see what happens next year, whether they use more or less fossil fuel because, well, it's pretty clear what they're going to do.

AL: Well, in Germany, 2010 to 2020, the lignite power generation went down 37%. The hard coal by much more than that. Oil by 52%, gas went up 3%. But there's a very dramatic reduction in both kinds of coal burning in the past few years. And that reverse…

ML: Imports of nuclear electricity from France?

AL: The net exports went up in that period. Yeah, slightly. Actually, don't confuse physical flows of electricity with contractual flows of electricity.

ML: But also what you're seeing, you have to be careful where you get the data from because a lot of German energy analysts fans of the Energiewende say, oh, yes but you know, those net exports, that was what all the coal all the coal that we were using was exports. And our use was very clean. But of course that doesn't, it doesn't work like that. And what they were what they were doing was burning a lot of coal and gas still. More than in the UK, where, you know, the UK by keeping its nuclear went from 40% in 2012, 40% coal to a couple of percent where it is now.

AL: I think the German experience is just as dramatic. And as for the Japanese example, they lost for a time all of their nuclear output. And now they've got, last I looked, nine units running. They've they have 20 - something that are viewed that they declare as operable that haven't run for 14 or 15 years and will probably never run again, and have no business case to run. And yet, the fossil fuel generation over that past decade barely budged. It went up, maybe 10, or 12 terawatt hours. Or maybe it went down depending on which month of revision you look at. Because as in Germany, both the nuclear and the fossil decreases were offset by a combination of savings and renewables. And that's especially impressive in Japan, where they have policy that looks pro renewable, but it's very ingeniously anti renewable, especially wind which is almost completely suppressed.

ML: The question for you, if you look at the next generations of nuclear, whether it's small modular, whether it's fusion, whatever it is, what would be your research budget for those? Would you spend absolutely nothing? Or would you say, Well, you know, it's a big world, there is a lot of money around, and it makes sense to have some small percentage to have a portfolio of strategies. And we should be spending something because, Hey, there can be a breakthrough, maybe fusion, maybe, would it be zero or not?

AL: I don't know, it depends on the merit of the proposals, it would certainly be small, because I don't think either fission or fusion in any known configuration has a ghost of a chance of having a business case. But you know, I think the issue, Michael, is not whether there's enough money in the world, that we can afford to spend it on foolish things as well as intelligent things. I think it's that if we have a climate emergency, we need to focus intently on deploying the most carbon displacements on supply and demand sides that we can per dollar and per year. And this is this is a, a terribly conservative and sound idea of marginal cost effectiveness, or in this case, climate effectiveness that I don't think you would disagree with in principle, but you are proposing to disagree with it in practice.

ML: No, I, I don't know whether it's in principle or in practice, what I don't like I don't like central planning. I don't like… Of course, if you're going to have a research budget, then there is an element of central planning, not in the sense of picking winner companies, but winning, winning, you know, you do have to sort of stay right, the bulk of the money will go on this, but maybe we have some side bets. And so that's kind of how I see it.

AL: Well, paying half or more, or probably all as we end up of the cost of next generation reactors with conscripted capital doesn't lead to a good place. The numbers are rather simple. Right now, the world is investing about $0.3 trillion a year in saving energy and point $0.3 trillion a year in modern renewables. At the same time, the world is investing about a $0.03 or $0.15 trillion, depending on which numbers you like in nuclear, the investors have fled. They voted with their feet. And what we now see is a massive move to socialize nuclear costs, because it's a very politically powerful industry, not because it's climate effective.

ML: But let me let me come down to there was another thing that I think you have worked a lot on, and it's related. It's moving on from nuclear, but it's obviously closely related, which is the intermittency I mean, you know, wind and solar, The sun doesn’t always shine, you would have noticed that even through marvellous design of your house. And so how do you ensure resilience of the energy system, if it is based, you know, if you're just constantly buying the lowest sort of levelized cost. And by the way, there's also a 0.3 missing in the statistics you've just given because there's also 0.3 of a trillion in fact a bit more than that spent every year on the grid on upgrading the grid and some proportion of that is also driven recently, by these, you know, sort of ballooning proportions of renewables which require grid investment alongside the generating capacity. So, what's your formula for keeping the lights on and keeping it affordable and keeping the users paying for it?

AL: Well, first of all, I would get the terms right. Intermittence is actually not properly applied to photovoltaics and wind, they are highly variable in output. But their variability is very predictable, actually, often more predictable than energy demand. It's predictable enough that the east Danish wind operators can bid wind power into next day's hourly auction, having more confidence they can deliver to contract on time, then the grid operators have that when they push the button, their peaker will actually start. The term intermittence is I think, properly applied to forced outages that are unpredictable. And that's very characteristic of thermal plants. They're down about 7% to 13% of the time, but typically in larger chunks and for longer than for portfolios of renewables. Therefore, it turns out in places that, that actually break out the cost, like the ERCOT or the Texas market, the cost to have grid integration is typically higher, often by several fold, for, say, wind farms than it is for a gas fired power plants or coal fired. I know I said, I said it the other way round. The other way around. Yes, I said it wrong. It's higher for the big thermal plants, because they tend to fail less predictably and bigger longer than for the renewable portfolio. So, the grid integration is actually cheaper for the variable renewables. But that's because you diversify them in space, and in time, you operate them intelligently, they tend to be complementary seasonally, and often diurnally, as well. And there are also dispatchable renewables, which are quite substantial. So that's big and small hydro, not to mention, pumped storage, there's a lot of that installed already. Geothermal, burning, municipal, industrial and agricultural wastes, burning obsolete energy studies, that's my favorite. And, of course, we also have distributed storage, which will become quickly quite enormous in electric vehicles that are parked 95 odd percent of the time, and are starting to get bidirectional, and you can store heat and cool much cheaper than storing electricity. And then of course, there's the demand side. Efficiency has an important effect on timing as well, because it makes things happen slower in the temperature of buildings. And there was just a new NREL study beautifully showing over an order of magnitude reduction in investments, if you compete, building efficiency, retrofit efficiency, against both supply and storage, and then you don't need most of that seasonal storage hydrogen people talk about. And then of course, there's demand response itself, which in Texas, we found was about three times bigger than had been thought. So, you add all this up, and they're all together 10 carbon free ways to keep the grid, reliable, resilient, and affordable as it gets renewable. But only one of those is batteries. They happen to be the <inaudible> at the moment. So we shouldn't assume it's all about batteries.

ML: No, it's definitely not about batteries. But I guess I worry because there's a lot of sort of… there's a lot of those places. So you know, it's like the Neapolitan cup game where you kind of know where, where did the problem go? Because, you know, we've got in Europe. We have wind loads that last two or three weeks, you have in India, you've got the monsoon where I'm assuming <inaudible> a number of weeks is dramatically reduced. Even in California, it does rain, I remember the Queen went to California and it rained and people's, you know, the UK, they thought this was just extraordinary and it and it was hence I remember it 30 years or whatever it is later. And you know, when you talk about demand response, it tends to be, you know, a few hours batteries globally, the amount of batteries are a few minutes, even the batteries in vehicles, then they would run the global economy for maybe once you've got lots of electric vehicles, it'll be a few hours, and you've got a few hours here and a few minutes there and maybe a day if add in thermal storage, and you're really working hard and so on, but you know, we've got a system that is becoming more and more electrified, we're removing coal, we're removing gas, we're removing nuclear, we're removing things that have got storage that's kind of inherent in them. And you know, all those pipelines are going to be gone. And we are becoming dependent on weather. And every so often, there's a few weeks where the weather just doesn't deliver. And I don't know that the things you name add up to enough.

AL: What you're raising and rightly so is an issue of seasonality and the dark doldrums.

ML: It’s not just seasonality because I mean, seasonality would suggest that it's very predictable. I'm talking about you know, you can have…

AL: I was saying things like the dark doldrums in Germany? Yeah, well, there's a very interesting new study just out from the Belgian-German consortium of the German part, by the way, is 50 hertz, the former East German utility, one of the most reliable on the planet. I think you'd have to go back to probably before World War Two for their last big power failure. And so these systems are 99.999% reliable, and by the way, 50 hertz hit 62% renewable last year heading for a 100% in 2032. So, they're not novices at this. So, they've done a very nice analysis for Europe, because it is the poster child of these wind lulls and, and long cloudy winter periods. And they found that on a pan-European basis, once you build the east, west interconnectors that didn't get built because of the Cold War until now, then you find that, according to them, and I think their data are correct. It hardly you hardly ever get more than four days of wind and sun together falling below 20% of normal. And they found that to cope with this and they looked at a period of seven years. You would need green molecules for backup, hydrogen, ammonia whatever made renewably amounting to about 6% of normal winter generation. And you only need one or two weeks of that backup not months, as has often been claimed. So, you do need to look at the weather statistics. And we also need to look ahead to make sure we've got this right. At whether there are basic changes in global weather patterns that we need to be more worried about. But you know, even if you if you felt you had to deal with this by maintaining in retrievable mothball the existing gas fired capacity and gas in reservoirs, that that stuff already exists. And in fact, the capacity you need is about the right size to fill the European need in 2015. It would run rarely, <inaudible>

ML: Now, I feel like I said it was a bit like the Neapolitan cup and ball give me like, I feel like I found it because, you know, I believe we do need the green molecules or even very, very infrequently used brown molecules peakers when we need something because we can't get the normal electrification plus heating electrified plus transport electrified plus industry electrified and then have any risk whatsoever of even for days, where you're even having days once every five years. That's four days when a lot of people are going to I mean not to put too fine a point I mean, die it this is that serious the resilience challenge.

AL: Well, having written the basic book on resilience for the Pentagon in ‘81, I take very seriously the responsibility you described. Of course, the big question here, as we electrify everything is whether global use of electricity will go up or down and I think it could go either way. There are many studies assuming two-to-six-fold increase in global electricity needs in 2050. There are of course inherent and very strong efficiency gains as you electrify many uses and there are also other ways to save besides energy saving my one of my favorites is that you know, half the weight of a typical mid- or high-rise building is the floor slabs plus more to hold up that weight. But you can save three quarters of that cement and steel which together cause 15% of CO2 emissions. By proper structural design, you can use a corrugated five-centimeter-thick slab instead of a flat 30-centimeter-thick slab, and it's cheaper, then you can fit three stories in the vertical height of two with the same ceiling height, why would you do anything else? So, what we don't know is what really happens to electric demand. If we do integrative design if we compete, efficiency against supply, which hardly anybody bothers to do, and a whole list of other things, some of which we've mentioned. And this, this you know, I'm very struck by this point about not competing efficiency against supply because in Reinventing Fire, we worked out that the US could quadruple electric end use efficiency by 2050. And the cost of doing that would average a 10th what we pay for retail electricity today. So, we didn't buy nearly enough efficiency. And that was even not considering most of the integrative design. How much more efficiency would we buy? If it were fully fairly competed against supply even the cheap renewable supply? Probably a great deal more than most people suppose.

ML: We’ve ran out of time, we've actually gone one hour, I would love to hear your thoughts on there's all sorts of things we could still talk about. I would love to hear explicit thoughts on primary energy. When we think about primary energy, what sort of what sort of problems does that also what blind alleys does that lead us down? I would love to hear your thoughts on the heavy industry on heavy trucks, all sorts of things. But I'm afraid we're out of time. But leave us with a with a final thought, you know, you've got this this some sort of modest but extremely influential audience out there. What would be the the single message you want to leave them with?

AL: Well, I hope I live to see a world where all ways to save or supply energy are fully and fairly competed and honest prices, regardless of their type, technology, size, location or ownership. That's pretty much the opposite of the system we have now in most of the world. And we also need to look at the entire energy system, because right now we've got grid centric people saying, we'll need a lot of extra solar and wind to cope with extreme conditions. We've got people wanting to decarbonize the other four fifths of the economy, not yet electrified, saying, we're going to need to build a whole bunch of sun and wind to make green molecules to run our industries. Well, actually, they're often as Tony Seba points out, talking about exactly the same solar and wind use for different purposes at different times, but being double counted. So we need to get out of our grid silo, and look at the whole system. And I think we're going to find that an efficient, renewable resilience, energy future costs a good deal less than business as usual. And as the Oxford folks say, the faster you do it, the cheaper it gets. So, these academic, and I would say even scholastic disputes about what should be your discount rate and how does that affect what you do about climate are completely misplaced. They're looking at tradeoffs that don't actually exist. And we just need to move quite aggressively on efficiency and renewables and not worry too much about exactly how we'll get from 90% to 100% renewable. We know we have enough ways to do it that are adequate and cost effective and attractive. We don't need to know now exactly which ones will use as Ken Caldera said we shouldn't let uncertainty about the end game unduly influence our opening moves.

ML: So I'm glad you finish there with Ken Caldera, who's a great hero of mine, as you'll gloss over the reference to Tony see, but the Tony Seba who thinks that that 95% of vehicle miles driven in 2013 will be in autonomous electric cars a vehicle which does not exist today. I have to say not somebody I have a lot of time for but your desire for an energy system that that allows competition of energy efficiency and thermal storage and other goods on equal footing with some hard supply. Let's just hope that amongst my many listeners, that Father Christmas is one of them. We have Christmas approaching, and hopefully that request will be heard and will be granted to you I suspect you've got decades to go in your career. But I very much hope that that vision the future arrives more quickly than you think. Amory has been a huge pleasure having you on Cleaning Up.

ML: Thank you so much for your time. You have a good day.

AL: My pleasure. And remember the bananas.

ML: We'll never forget the bananas, the banana phone. Thanks, Amory. Bye, bye. So that was my great friend, Amory Lovins, co-founder and chairman emeritus of the Rocky Mountain Institute, and adjunct professor in Civil and Environmental Engineering at Stanford University. My guest next week, is Peter Sweatman. He's the founder and CEO of Climate Strategy Partners, a world expert in energy efficiency and climate investment. Please join me at this time next week for a conversation with Peter Sweatman.