Jeffrey Ball: Help Deploy Technology That Curbs Energy Waste

What steps can – and should – local, state and federal governments take to encourage energy conservation?

Most places around the world that have succeeded in getting consumers to use energy more wisely have had the benefit of a crisis to push that change. They were hit by a war, or an energy shock or visibly dirty air. So they benefited from broad public agreement that something had to change.

The United States doesn’t face such a crisis. So it’s unlikely many Americans will willingly change their behavior to consume less. At a time when the U.S. is swimming in domestic natural gas, for instance, it’s harder than ever to make the argument that Americans should take extra care to turn off the lights when they’re not in a room.

The upshot: Technological fixes to curb energy waste are likely to prove more effective in the U.S. than are calls for behavioral change. The question is how to roll out that technology. Two ideas show merit.

One is tweaking government regulations that get in the way of private investors bankrolling energy-efficiency improvements where those investors think they can make money in the process. Wall Street is showing increasing interest, for example, in cobbling together portfolios of small energy-efficiency upgrades in buildings. Securitized into portfolios, those efficiency improvements could make a real dent in U.S. energy consumption.

Another idea is changing today’s electric-utility regulations, which generally reward power companies for selling more power. By incentivizing power companies not just to sell more juice–but also to deploy technologies that help their customers use their juice more efficiently–the government could enlist powerful private forces in the push to curb energy waste.

Jeffrey Ball (@jeff_ball), formerly The Wall Street Journal’s environment editor and a longtime energy reporter at the paper, is scholar-in-residence at Stanford University’s Steyer-Taylor Center for Energy Policy and Finance, a joint initiative of Stanford’s law and business schools. He writes about energy and heads a project exploring the relationship among countries in the globalizing clean-energy industry.