Chapter 3: My Energy Errors
by Brian Gitt
My teenage passion was keeping the wilderness pristine. I only took jobs that I thought contributed to that goal. I led mountaineering expeditions in Alaska, spent months backpacking in the Rockies, and climbed the highest peaks in national parks. In my twenties, I started a company that built composting systems for cities and businesses and served as executive director of an organization that championed green construction policies. Later I became CEO of a consulting firm that worked on making homes more energy efficient and went on to start a software company that helped sell solar power.
I felt like I was fighting the good fight. But feeling like you’re doing the right thing doesn’t mean you are. I thought I was promoting the well-being of humanity and also protecting the environment. In fact, I was harming both. I was wrong, but I couldn’t admit it because my sense of identity was tied to false beliefs about energy and the environment.
I believed—falsely—that solar and wind power were the only hope of avoiding environmental catastrophe. And I believed—falsely—that fossil fuels were poisons extracted from the earth by greedy companies plundering the land, polluting the air, and destroying ecosystems. These beliefs blinded me to energy policies that could help both people and the planet.
Two experiences opened my eyes. The first happened when I was the CEO of an energy consulting firm specializing in clean-energy technologies. The Obama administration had earmarked billions of dollars in federal funding to create jobs in the energy sector. They wanted to upgrade millions of homes and started programs to help states like California make homes energy efficient. To that end my company won multiyear contracts valued at more than $60 million. We had all the right stakeholders: the utilities, the local governments, the California Public Utilities Commission, the Energy Commission, and the right contractors.
But the project was an utter failure. It didn’t get anywhere close to the goals the government had set. California had aimed to cut energy consumption by 40% in nearly 100% of homes by 2020. In reality, we upgraded a few thousand homes in a state with over 14 million housing units.
I had always believed that lack of money and government support stood in the way of energy-efficient homes and a society powered by the wind and sun. But in 2009 we had both money and government support. We had the right resources, the right people, the right technology, the right regulatory support, and everything else I thought we needed. But we still failed.
The California Energy Commission's response was even more shocking. It refused to admit the failure! Instead, all its public communications boasted of the program’s success.
The program was a success in at least one way: it made some consultants money. But it didn’t help protect people or the planet.
So I decided to start fresh. I secured funding from Y Combinator to found a software startup called Utility Score. Our aim was to build an app that would instantly show people how much money they could save by undertaking home performance projects like installing solar panels or upgrading air conditioning and heating systems. We compiled a comprehensive dataset of over 100 million homes across the US, worked closely with the leading solar providers and home performance contractors, and then signed a contract with Zillow to embed the data into real estate listings. We thought that when people saw how affordable it was to live in a solar-powered, energy-efficient home, the housing market would change forever.
But we were wrong. We found that solar panels and home performance projects don’t save people money. Almost all the utility savings disappear when you weigh the cost of installing and maintaining solar panels against the amount of energy the panels can realistically provide year round. Only a small percentage of homes in California, Arizona, or another state with year-round sunshine and generous solar subsidies and tax credits stand to save money. For the vast majority of households in the US, solar panels don’t make financial sense. It takes so long to recoup the cost of these home performance projects that most people won’t be living in the same house by the time they “pay for themselves.”
My experiences in the green energy industry forced me to question my beliefs about energy and the environment. The more I researched, the more I began to see that my beliefs were false. Here are a few of them:
Myth 1: Solar and wind power are the best ways to reduce CO2 emissions.
It turns out that solar and wind power aren’t the best ways of reducing CO2. The biggest reductions in CO2 emissions during the past 15 years—over 60%—have come from switching from coal to natural gas.
Myth 2: The world is transitioning to solar, wind, and batteries.
It turns out that the world isn’t transitioning to solar, wind, and batteries. Trillions of dollars have been spent on wind and solar projects over the last 20 years, yet the world’s dependence on fossil fuels has declined only 4 percentage points: from 87% to 83%.
Myth 3: Nuclear energy is dangerous, and nuclear waste is a big problem.
It turns out that nuclear energy isn’t dangerous, and nuclear waste isn’t a big problem. In fact, nuclear power is the safest and most reliable way to generate low-emission electricity. It provides wealthy nations like the US the best overall way of reducing emissions while maintaining reliable baseload power.
Myth 4: The amount of energy people consume is directly proportional to the amount of environmental damage they cause (aka The Damage Assumption).
It turns out using more energy protects the environment (as we discussed in Chapters 1 and 2). Making poorer nations wealthier is the most effective way to minimize and reverse damage to the environment. And the best way of making poorer nations wealthier is to help them increase the amount of energy they consume, not decrease it.
These myths drive bad investments and poor policy decisions. Days and dollars spent on them cause harm and suffering to the poorest among us—a high cost for false moral comfort. To move forward, we need the Better Energy Strategy.