ROCKY MOUNTAIN INSTITUTE: BEACON OF APPLIED HOPE

Greetings,

As a financial gale howls through the rigging and the political deck pitches beneath our feet, Rocky Mountain Institute perseveres straight toward our destination—a world that is secure, just, prosperous, and life-sustaining. We’ve always steered by that tall star, not by passing gusts. The spray is wet but the wild sea is exhilarating. With steady hands and unswerving purpose, our captain and crew are confident that this turbulence only underscores the reasons for the journey. The gale’s from astern, so let’s hoist the spinnaker—full speed ahead!

We ask for your continued support in provisioning our ship because the world has changed: our thought leadership and dogged application to real-life environments have built new opportunities that are now becoming accepted tenets of mainstream thinking and business behavior. A 6 September 2008 two-page Economist feature on RMI’s work noted that “today’s interrelated energy and climate difficulties have at last made the world see the importance of resource efficiency, energy innovation and holistic design—principles [we’ve] been advocating for nearly four decades.” So we must focus even more intently on choosing the most effective ways to take our work rapidly to scale.

That’s why, last month in Portland, Oregon, we used our convening power to assemble automakers and utilities, real-estate developers and retailers, telecoms and infrastructure firms, electronics and battery wizards, journalists and marketers and policymakers in an unprecedented three-day summit. Together we explored and refined new business models and technical insights for “Smart Garage”—ways for electrified cars, buildings, and the electricity grid to exchange energy and information and thus create new forms of value. This three-way integration, which we first suggested in 1991, has vast potential because cars will ultimately have over ten times as much electric output capacity as all utilities own.

Recharging a half-plug-in-hybrid car fleet at night would save carbon and wouldn’t need more power plants, but would justify bringing on line 230 billion watts of windpower that could more than replace all coal plants. That much windpower isn’t a fantasy—it’s already been proposed but is stuck in the queue waiting for transmission access. RMI also analyzed wind energy across the Great Plains and found that combining sites that are windy at different times could save over half the wind capacity needed for the same reliable supply. Alternatively, we found, two-thirds of all coal-fired electricity would no longer be needed if every state (adjusted for climate and economic mix) simply used electricity as productively as the most efficient ten states now do.

Last year, the U.S. added more windpower than the world added nuclear capacity—more windpower than the U.S. added coal-fired capacity in the past five years combined. Micropower and “negawatts” (saved watts) now provide over half of the world’s new electrical services. Thus RMI’s vision of a Next-Generation Utility—efficient, climate-safe, diverse, dispersed, renewable, and resilient—is starting to take tangible shape. Henry Ford said, “Whatever is worthy and right is never impossible,” and “Whether you think you can or whether you think you can’t, you’re right.” We know we can. With your generous support we will.

And with that support we hope also to convene a similarly incisive end-to-end scrutiny of the solar-power value chain, comprehensively wringing out costs to make photovoltaics affordable for all. Already, says Tom Dinwoodie (founder of a market-leading solar firm and a new RMI Trustee), if you build side-by-side coal and solar plants of equal annual output in (say) New Jersey, starting now, then by the coal plant’s completion, the solar plant will be producing four times its peak output—and cheaper electricity. But we think solar economics can become far better still.

Oil is an even bigger part of the climate problem than electricity, and is at the core of America’s national security challenge. In 2004 we published, and now we’re implementing, Winning the Oil Endgame—a pioneering Pentagon-cosponsored roadmap for getting the U.S. completely off oil, led by business for profit, at an average cost of $15 per barrel. Our next off-oil leadership move is the “Oil Solutions Summit” we’ll convene this month with The Brookings Institution. It will bring together the authors of the many plans and proposals to relieve America’s oil dependence—industry and environmentalists, national-security hawks and climate protectors. Together we’ll map commonalities and gaps to synthesize shared approaches. This could help the new Administration rise above the cacophony and craft a coherent oil policy that commands wide consensus. And we’re exploring a car-efficiency leapfrog strategy as bold, and as revitalizing for Detroit, as its six-month shift in 1941–42 to making the materiel that turned the tide of World War II.

Rocky Mountain Institute has the right people and skills at the right time to make the difference the world needs. Our work on many interlinked fronts (summarized here) moves radical resource efficiency from ideation through barrier-busting to implementation. The later stages often get client funding from private-sector partners to leverage your philanthropic dollars. But philanthropy first lays the foundations by funding our innovations, incubating their growth, and enabling us to keep attracting extraordinary people.

We aim to weather this financial storm as we have others. Amidst revenue uncertainty we’ve taken prudent steps to stay agile. As our generous donors face similar turbulence too, we would respectfully suggest six thoughts:

* Today’s new political and economic landscape offers unique opportunities to accelerate RMI’s mission: the reasons you’ve previously supported our work just became far more compelling.
* If you must reduce your overall giving this year, you could sustain its impact by focusing on the organizations that create the biggest social return on your investment. (Transforming the economy from one running on fossil fuels to one largely based on clean energy offers new opportunities to build whole new industries providing millions of new jobs all across the country.)
* If you have the capacity to increase your support, that will help offset any shortfall from donors less fortunate, so we can maintain our headway.
* Congress just extended the law so donors at least 70.5 years old can give charities like RMI up to $100,000 per year tax-free directly from ordinary or Roth IRAs in 2008 and in 2009, by the simple method explained here.
* If you have some low-yielding assets like CDs and want to know they’re doing good work on issues you care about, you might consider a loan to RMI at a mutually attractive interest rate. This lets us capitalize our capital items so they don’t rob cashflow from our work. To discuss this opportunity, which many friends of RMI have used for two decades, please contact Doug Laub.
* Please consider a multi-year pledge of support to RMI, because a longer view of our course is immensely helpful in planning the most effective execution of our multi-year strategic initiatives.

Michael C. Muhammad said, “Everything works out right in the end. If things are not working right, it isn’t the end yet.” The haven we’re navigating toward is still distant, storms are looming, and the seas are perilous, but our vessel is strong, our crew brave, and our intent undimmed. Together we will arrive. Thank you for coming aboard.

Amory B. Lovins Michael Potts
Chairman and Chief Scientist Chief Executive Officer

The early bioneer Bill McLarney was stirring a vat of algae in his Costa Rica research center when a brassy North American lady strode in. What, she demanded, was he doing stirring a vat of green goo when what the world really needs is love? “There’s theoretical love,” Bill replied, “and then there’s applied love”—and kept on stirring. At Rocky Mountain Institute, we stir and strive in the spirit of applied hope. Our people work hard to make the world better, not from some airy theoretical hope, but in the practical and grounded conviction that starting with hope and acting out of hope can cultivate a different kind of world worth being hopeful about, reinforcing itself in a virtuous spiral. Applied hope is not about some vague, far-off future but is expressed and created moment by moment through our choices. Applied hope is not mere optimism. The optimist treats the future as fate, not choice, and thus fails to take responsibility for making the world we want. Applied hope is a deliberate choice of heart and head. The optimist, says RMI Trustee David Orr, has his feet up on the desk and a satisfied smirk knowing the deck is stacked. The person living in hope has her sleeves rolled up and is fighting hard to change or beat the odds. Optimism can easily mask cowardice. Hope requires fearlessness. Fear of specific and avoidable dangers has evolutionary value. Nobody has ancestors who weren’t mindful of saber-toothed tigers. But pervasive dread, currently in fashion and sometimes purposely promoted, is numbing and demotivating. When I give a talk, sometimes a questioner details the many bad things happening in the world and asks how dare I propose solutions: isn’t resistance futile? The only response I’ve found is to ask, as gently as I can, “Does feeling that way make you more effective?” To be sure, mood does matter. The last three decades of the twentieth century reportedly saw 46,000 new psychological papers on despair and grief, but only 400 on joy and happiness. If psychologists want to help people find joy and happiness, they’re looking in the wrong places. Empathy, humor, and reversing both inner and outer poverty are all vital. But the most solid foundation we know for feeling better about the future is to improve it—tangibly, durably, reproducibly, and scalably. At RMI we’re practitioners, not theorists. We do solutions, not problems. We do transformation, not incrementalism. In a world short of both hope and time, we seek to practice Raymond Williams’s truth that “To be truly radical is to make hope possible, not despair convincing.” Hope becomes possible, practical—even profitable—when advanced resource efficiency turns scarcity into abundance. The glass, then, is neither half empty nor half full; rather, it has a 100 percent design margin, expandable by efficiency. In our most recent Annual Report, available at rmi.org, my colleagues outline the latest steps in RMI’s long journey of applied hope. As signs of RMI’s effectiveness proliferate, our challenges are chiefly those of success—of needing ever more discriminating focus as the world moves our way, demanding that our limited resources be rapidly scaled to serve nearly infinite needs. We can’t do everything; doing just anything may miss the mark; doing nothing is unacceptable; but doing the right things at the right time can make all the difference. We are intently engaged in discerning and reaching those goals. In a world so finely balanced between fear and hope, with the outcome in suspense and a whiff of imminent shift in the air, we choose to add the small stubborn ounces of our weight on the side of applied hope. I was overwhelmed by the generous support for Rocky Mountain Institute this past year. RMI's annual fall appeal is approaching, and we certainly hope you'll consider partnering with us. If you'd like to give now and beat the holiday rush, it's not too early to make a tax-deductible gift. Please click here to make a secure, online donation to support this crucial work. Thank you. AMORY B. LOVINS Cofounder, Chairman, and Chief Scientist Rocky Mountain Institute (RMI) is an independent, entrepreneurial, nonprofit organization. We drive the efficient and restorative use of resources to make the world secure, just, prosperous, and life-sustaining. If you wish to modify your subscriptions or unsubscribe and don't have a username and password, please reply to this email to unsubscribe. Otherwise, please click the Email Preferences link below.

http://www.economist.com/science/tq/displaystory.cfm?story_id=11999219

The frugal cornucopian

Sep 4th 2008
From The Economist print edition

Amory Lovins began making the case for resource efficiency decades ago, long before it became fashionable. Now things are going his way

Illustration by Andy Potts

IF ANYBODY should be on top of the world today, it is Amory Lovins. That is not just because the energy visionary makes his home on a mountain in Old Snowmass, Colorado. Rather, it is because today’s interrelated energy and climate difficulties have at last made the world see the importance of resource efficiency, energy innovation and holistic design—principles that he has been advocating for nearly four decades.

For much of that time, Mr Lovins, who heads the Rocky Mountain Institute (RMI), a natural-resources consultancy, has been a lonely voice in the wilderness. As far back as the early 1970s, he sounded his first alarm about the potential damage that climate change might bring, but he was ignored. In a paper in Foreign Affairs in 1976, at the height of the energy crises and neuroses of that decade, he argued that what the world needed most was not new energy supplies but more efficiency. He was ruthlessly attacked by the energy industry and the political establishment, and his proposal for an alternative “soft path” out of the energy crisis was dismissed. Energy and economic growth always grew in lockstep, went the conventional argument, and to think otherwise was dangerously naive.

But history has proved him right. Thanks to a combination of high prices and public policies aimed at encouraging efficiency and conservation, America’s energy use did decouple from economic output in the wake of the oil shocks of the 1970s. Crucially, this happened without impoverishing the country, proving his once-controversial thesis that growth and greenery can indeed go hand in hand. That experience, along with the recent global energy-price shock, has made it respectable for business and political leaders to talk about energy efficiency.

Mr Lovins should be pleased, but his satisfaction at having been proved right is tempered by lingering unease that there are echoes of the 1980s in today’s debate. The main problem with the approach to energy in the 1970s, he argues, was that the issue was defined as a supply shortage. “The question they asked was how to get more energy, at any price, instead of asking: ‘How should we use energy, why are we using it so wastefully, and what do people really use energy for?’” he says.

That question points to one of his main contributions to the energy debate. He insists that the goal of public policy should be to ensure adequate and affordable supplies not of energy per se but of “energy services”—as he loves to put it, the cold beer and hot showers made possible by energy. By redefining the problem that way, rather than merely subsidising more power plants or oil drilling, public policy can be made technology neutral, and consumer needs can be satisfied by demand-side measures if they prove cheaper than drilling or digging for new supply.

FORGET NUCLEAR

By Amory B. Lovins, Imran Sheikh, and Alex Markevich

Nuclear power, we’re told, is a vibrant industry that’s dramatically reviving because it’s proven, necessary, competitive, reliable, safe, secure, widely used, increasingly popular, and carbon-free—a perfect replacement for carbon-spewing coal power. New nuclear plants thus sound vital for climate protection, energy security, and powering a growing economy.

There’s a catch, though: the private capitalmarket isn’t investing in new nuclear plants, and without financing, capitalist utilities aren’t buying. The few purchases, nearly all in Asia, are all made by central planners with a draw on the public purse. In the United States, even government subsidies approaching or exceeding new nuclear power’s total cost have failed to entice Wall Street.

This non-technical summary article compares the cost, climate protection potential, reliability, financial risk, market success, deployment speed, and energy contribution of new nuclear power with those of its low- or no-carbon competitors. It explains why soaring taxpayer subsidies aren’t attracting investors. Capitalists instead favor climate-protecting competitors with less cost, construction time, and financial risk. The nuclear industry claims it has no serious rivals, let alone those competitors—which, however, already outproduce nuclear power worldwide and are growing enormously faster.

Most remarkably, comparing all options’ ability to protect the earth’s climate and enhance energy security reveals why nuclear power could never deliver these promised benefits even if it could find free-market buyers—while its carbon-free rivals, which won $71 billion of private investment in 2007 alone, do offer highly effective climate and security solutions, sooner, with greater confidence.

******

So why do otherwise well-informed people still consider nuclear power a key element of a sound climate strategy? Not because that belief can withstand analytic scrutiny. Rather, it seems, because of a superficially attractive story, an immensely powerful and effective lobby, a new generation who forgot or never knew why nuclear power failed previously (almost nothing has changed), sympathetic leaders of nearly all main governments, deeply rooted habits and rules that favor giant power plants over distributed solutions and enlarged supply over efficient use, the market winners’ absence from many official databases (which often count only big plants owned by utilities), and lazy reporting by an unduly credulous press.

Isn’t it time we forgot about nuclear power? Informed capitalists have. Politicians and pundits should too. After more than half a century of devoted effort and a half-trillion dollars of public subsidies, nuclear power still can’t make its way in the market. If we accept that unequivocal verdict, we can at last get on with the best buys first: proven and ample ways to save more carbon per dollar, faster, more surely, more securely, and with wider consensus. As often before, the biggest key to a sound climate and security strategy is to take market economics seriously.

Mr. Lovins, a physicist, is cofounder, Chairman, and Chief Scientist of Rocky Mountain Institute, where Mr. Sheikh is a Research Analyst and Dr. Markevich is a Vice President. Mr. Lovins has consulted for scores of electric utilities, many of them nuclear operators. The authors are grateful to their colleague Dr. Joel Swisher PE for insightful comments and to many cited and uncited sources for research help. A technical paper preprinted for the September 2008 Ambio (Royal Swedish Academy of Sciences) supports this summary with full details and documentation (www.rmi.org/sitepages/ pid257.php#E08-01). RMI’s annual compilation of global micropower data from industrial and governmental sources has been updated through 2006, and in many cases through 2007, at www.rmi. org/sitepages/pid256.php#E05-04.

READ THE WHOLE ARTICLE AT: http://www.rmi.org/sitepages/pid467.php

The issues of renewable energy and energy independence have taken center stage in both media and political conversations lately, but the means of achieving various energy goals have proven to be rather controversial. Proposed options dominating news headlines include clean coal, nuclear energy, and offshore drilling. Is there an energy path that we can all agree upon? The answer is yes, and this morning Rocky Mountain Institute and Chief Scientist Amory Lovins were featured in a New York Times blog in response to last night's Presidential Debate. Energy efficiency, a solution at the core of RMI's work, was discussed as a viable and economically profitable resolution to both energy and economy issues. New York Times writer Kate Galbraith points out that RMI and Amory Lovins have consistently advocated the benefits of a soft-path approach to energy, with efficiency at it's core. You can read the article here. When it comes to nuclear power specifically, every dollar invested in new US nuclear electricity will save approximately 2-11 times less carbon, and will do so roughly 20-40 times slower, than investing in the same dollar in energy efficiency and "micropower" (cogeneration plus renewables minus big hydro dams). Buying new nuclear capacity instead of efficiency causes more carbon to be released than spending the same money on new coal plants! These conclusions and the empirical evidence supporting them are summarized in "Forget Nuclear," and fully documented in "The Nuclear Illusion," available for download here, which is to be published in early 2009 by the Royal Swedish Academy of Sciences' journal Ambio. Hopefully our vision will help put these widely publicized issues into perspective and move us all toward a better understanding that takes us beyond politically divisive issues to collective and viable solutions. Sincerely, Rocky Mountain Institute RMI's world-changing work relies on the generous support of its donors. Please click here to make a secure online donation. If you wish to modify your subscriptions or unsubscribe and don't have a username and password, please click here. Otherwise, please click the Email Preferences link below.