12/30/2013 08:20 am ET Updated Mar 01, 2014

Making Progress on Greenhouse Gas Emissions: Energy Efficiency and Solar Power

Discussions about international climate agreements and carbon taxes are at the center of the climate policy debate, but remain completely out of reach. Meanwhile, smaller scale incremental changes continue throughout the United States. Last week, we saw examples of two such changes reported in the New York Times. The first was a voluntary agreement to reduce energy waste in cable TV boxes. The second was an effort in California to utilize existing battery technology to store solar energy.

The cable box wastes an enormous amount of electricity. I first learned that from Luke Falk, an expert in energy efficiency who is a sustainability manager at the Related Companies. Luke also teaches energy efficiency in Columbia's Sustainability Management Program. I remembered how surprised I was when Luke first mentioned it, and now three years later, something is being done to alter the status quo. According to Matthew Wald of the New York Times:

"Generally, a DVR device consumes half as much electricity as a standard refrigerator and freezer. Under an earlier industry initiative, set-top boxes supplied after Jan. 1 will use 15 percent less than was typical in 2009. With the latest agreement, new ones will cut consumption by an additional 20 percent by 2017."

As Wald indicates, the problem is that the people who own the box, namely your cable company, do not pay the electricity bill in your home. They have no incentive to spend money on engineering to reduce the cable box's energy use. You, as the cable viewer do not actually own the box, and in all likelihood have no idea how much energy it uses. This creates a perfect formula for wasted energy.

Energy waste related to the separation between owners and users is not limited to cable boxes. If your landlord owns the central heating and air conditioning units of a building, but only pays to heat and cool common areas, he or she has little incentive to make a capital investment in a new energy efficient boiler or central air conditioner. Most of the savings from those investments are gained by tenants.

There are financial techniques that can be used to change the incentive structure, but they often require action by the government or collective action by those who are wasting energy that might be saved. One of the more interesting trends over the past decade in equipment and appliance engineering is the addition of energy efficiency to equipment design parameters. We have seen dramatic reductions in energy use by air conditioners, refrigerators, and some computers. When engineers are not directed to focus on energy efficiency they don't bother, but when they are directed to focus their brain power on saving energy the gains have been impressive.

The cable agreement was an effort to avoid command and control regulation of cable box energy efficiency. The U.S. federal government brokered the agreement and in a December 23rd press release noted that:

"...the U.S. Energy Department, the Natural Resources Defense Council (NRDC), the American Council for an Energy-Efficient Economy (ACEEE), the Appliance Standards Awareness Project (ASAP), the Consumer Electronics Association (CEA)® and the National Cable & Telecommunications Association (NCTA) announced non-regulatory energy efficiency standards for pay-TV set-top boxes that will result in significant energy savings for more than 90 million U.S. homes. These new standards - developed through a non-regulatory agreement between the pay-TV industry, the consumer electronics industry and energy efficiency advocates - will improve set-top box efficiency by 10 to 45 percent (depending on box type) by 2017, and are expected to save more than $1 billion on consumer energy bills annually."

The press release claimed that the agreement would avoid at least five million metric tons of carbon dioxide emissions per year. That of course assumes that the electricity we use will remain heavily based on fossil fuels for the foreseeable future. While that is a reasonable assumption, it is possible that in addition to technological advances in energy efficiency, we are starting to see some progress in renewable energy as well.

The most interesting developments in solar power seem to be happening in California, a place well-known for its sunlight. As the ever enterprising Matthew Wald reported in the New York Times:

"Solar power is growing so fast in California -- with installations by customers increasing tenfold since 2006 -- that it is turning the state's power system upside down. In a twist that is being closely watched by power companies around the country, California utilities will install massive banks of batteries and other devices to store the power surplus created by solar panels in the afternoon, when the sun's rays are strong. The batteries are then to begin discharging power into California's electric grid in the early evening, around sunset, when the solar generation of energy dies down but demand rises as millions of people get home and turn on air-conditioners, televisions and other electricity gobblers."

It is clear that the feasibility of solar power hinges on two technologies now being aggressively developed. The first is the efficiency and size of solar cells. A nanotechnology-based solar cell holds the promise of smaller and eventually lower cost solar panels. Smaller and more efficient solar cells could dramatically increase their use. The second technology involves storing energy. The increased range of electric cars (miles between charges) is a direct result of improved battery technology. There is every reason to believe that these technologies will continue to improve. The breakthrough in renewable energy use will occur when the debt service and operational expense of home solar and battery installations are lower than the current power bill. This would enable households to reduce their dependence on the electricity grid.

The usual response to a focus on energy efficiency and solar power is that it will not generate enough power to address the world's need for energy. These "all of the above" energy "realists" then argue for more drilling, fracking, and nuclear power. Such technologies should be our last resort, not the reflexive first response that they seem to be. We need technologies that do not holdout the potential of poisoning us or our ecosystems and cannot be used as potential instruments of terror.

We enjoy the benefits of technology and will not give these benefits up willingly. Paradoxically, the best and possibly only way out of the dilemmas posed by modern technology, is more technology. But some technologies are riskier than others. Even the most careful efforts to extract fossil fuels from the ground risk damage to our ecosystems. Modern technologies for extracting fossil fuels: fracking, deep sea drilling, and mountain top removal carry increased risks of environmental damage. Nuclear power involves a number of other risks, including a waste stream that remains toxic for thousands of years. Fortunately, there is no argument against energy efficiency. How does one oppose using less energy to do the same work? The argument for solar power is its virtually infinite supply and the fact that it will come down in price as we improve the technologies we use to capture it and store it. My view is that progress will come from the ground up. Sped by national government policy and federal R&D, but driven by localities, corporations and nonprofits, and households.