The
timing is important since nobody on the GOP side is paying attention; the MSM
is preoccupied with criticizing Republican attendees and praising the upcoming
DNC event.
The
release of this executive order days before the national Democrat convention
and before the final relay of the presidential election points in the direction
of a President who wants to claim, in the last leg of the race, that is he is
going to create those manufacturing jobs he failed to create so far and protect
nature, the pet issue of the environmental left, his most ardent supporters.
The
executive order addresses the fact that the” industrial sector accounts for
over 30 percent of all energy consumed in the United States.” Manufacturing
should use energy more efficiently through combined heat and power (CHP).
“Instead
of burning fuel in an onsite boiler to produce thermal energy and also
purchasing electricity from the grid, a manufacturing facility can use a CHP
system to provide both types of energy in one energy efficient step.
Accelerating these investments in our Nation’s factories can improve the
competitiveness of United States manufacturing, lower energy costs, free up
future capital for businesses to invest, reduce air pollution, and create
jobs.”
The
President directs federal interagency coordination with States to “convene
national and regional stakeholders to identify, develop, and encourage the
adoption of investment models and State best practice policies for industrial
energy efficiency and CHP.”
The
Departments of Energy, Commerce, and Agriculture, the EPA, the National
Economic Council, the Domestic Policy Council, the Council on Environmental
Quality, and the Office of Science and Technology will:
-
Coordinate
and strongly encourage a national goal of 40 gigawatts of new, cost effective
industrial CHP in the U.S. by 2020
-
Convene
stakeholders in industrial efficiency and CHP- Encourage investment in industrial efficiency and CHP by
a.
Assistance
to States for potential emission reduction benefits of CHP when developing
State Implementation Plans (SIPs) to “achieve national ambient air quality
standards”
b.
“Providing
incentives for the deployment of CHP and other types of clean energy, such as
set asides under emissions allowance trading program state implementation plans grants, and loans.”
c.
Output
based compliance options in power and industrial sector regulationsd. Expand Better Buildings, Better Plants program at the Department of Energy, seeking to” reduce energy intensity by 25 percent over 10 years”
Agencies
must consult with the Federal Energy Regulatory Commission in order to
accelerate investment in industrial energy efficiency and CHP.
According
to Dr. David Sponseller, since the Arab oil embargo of 1973, industrial
executives have been working to cut energy costs as much as possible without
compromising the manufacturing process. “The remaining opportunities for energy
saving are so dispersed and fragmented that it would essentially be more
trouble than it is worth to achieve the energy saving sought, and to do so in a
way that would satisfy the EPA and other environmentalists.”
The
“low hanging fruit,” the easy, less-expensive, and manageable energy savings
have already been made and further savings would be more trouble. A good
analogy would be, “hanging” an inefficient mini power plant on every industrial
process that uses a significant amount of energy. This would turn out to be a
fiasco not unlike Chairman Mao ordering the installation of inefficient mini
blast furnaces in people’s back yards all over China during the Great Leap
Forward.
In
metallurgy, a huge consumer of energy, savings were attained in refining,
steelmaking, melting, and heat-treating by the use of larger, more-efficiently
insulated furnaces, and simpler heat-treating procedures.
Utilities
use higher temperature and pressure systems to produce more kilowatt-hours from
fossil fuels. Utilities “have already built many combined cycle plants that
maximize the energy recovery sought by the CHP method.” Although more energy
could be saved, “every industry has already achieved major reductions in energy
consumption, at the urging of the U.S Department of Energy.”
From
the economic stand point, any capital investment to a manufacturing plant to
comply with the CHP and clean energy requirements would have to be sunk over
time and part of the cost passed on to the consumer.
The
federal government should not insinuate itself into the business management of
the American industry. “I am from the government and I am here to help you” is
a cliché, but it fits like a glove.
The
EPA is a classic example of an entity that chokes American business and
increases the use of energy needlessly. For example, billions of barrels of
crude have been wasted by EPA forcing engineers to recycle some of the exhaust
gases back through the engine, thus reducing its efficiency. “The lower
compression ratios required to meet the stringent emissions requirements on
autos have lowered the miles per gallon of cars significantly.” The constant
reduction of emissions requirements is not necessary since engines are now
small and efficient. The low sulfur limits on diesel wastes so much crude oil
in refining, that it nearly doubles the price at the pump. Power plants consume
more energy in order to meet absurd limits on smokestack emissions.
The
army of agencies, national and regional
stakeholders, state groups, industry groups would have to plan, monitor, and
coordinate in order to achieve the planned energy savings. It would be a
distraction to managers and engineers, preoccupied with running their
companies.
Analyzing
every stage of the production process, equipment, fertilizer, petrochemicals,
oil-refining, electricity generation, manufacturing industry for potential
energy savings would be counterproductive. Additional spending to satisfy
bureaucrats and environmentalists would reduce the overall industrial efficiency.
Government regulation would stifle industries in general and small businesses
in particular, costing billions of dollars a year.
This
executive order would work well in a centralized economy where everything is
micromanaged by the “omniscient” and often bumbling state. There is a reason
why 40 percent of manufacturing plants were closed in the former East Germany when
East Germany became part of West Germany again. The industrial base was very
weak. Factories were centrally planned and managed by the Communist Party and
were very inefficient, seldom turning a profit, constantly subsidized by the
state.
The
author wishes to thank Dr. David Sponseller, President of OMNI Metals
Laboratory, Inc. in Ann Arbor, Michigan, for his professional insight and
contribution to this article.
Great read...puts some energy efficiency laws into perspective.
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