There are many policies that the government can adopt to promote energy efficiency, and, to be sure, some will be more effective than others.  One of the most effective policies is rewarding those who install renewable energy generators with rebates or tax incentives, whether it be consumers or businesses.  We saw this in action when the American Recovery and Reinvestment Act gave a much needed boost to renewable energy back in 2009.  The incentives for wind projects alone led to a 31% increase in installed capacity of wind energy since 2009, with an average annual investment of $15 billion.(1)

But we all know making renewable energy cheaper for industry is an easy answer.  What are some of the other policies the government can implement to spur the growth of renewable energy?

I think one of the most important is the implementation of Renewable Portfolio Standards (RPS), which require electricity providers to generate a certain percentage of their energy from renewable technologies.(2)  Right now RPS are adopted from state to state, with 30 states and Washington D.C. enforcing them as mandatory measures, while 7 other states have voluntary goals (it’s up to the utilities if they want to participate or not.)  There are no national RPS as of yet.  To use California as an example of RPS in action, by 2020 they are requiring that 33% of the electricity generated in the state comes from renewable resources.(3)

Another policy that can be implemented is something a little more controversial:  taxing carbon emissions.  This works a little differently than incentivising renewable energy adoption as it entails promoting process efficiency.(4)  Just as we learned in Lesson 3, “the kilowatt not used is the best of all.”  By creating more efficient processes within industry we can simply avoid extra energy being used, reducing the need for both renewable and nonrenewable energy.  The other benefit of a carbon tax is that it allows state governments to collect extra money from dirtier industries–money that can be reinvested into mitigating the effects of climate change, developing new renewable energy projects, or funding education programs that will lead to a more aware and involved populace.  The Congressional Budget Office has a plan that could raise as much as $1.2 trillion during its first decade.(5)  You could imagine what an effect those fees would have on the efficiency of industry in the U.S. (assuming businesses stay in the country.)

A business that will benefit from these new efficiency mandates is a business that helps established businesses and industries meet these new standards.  Just as businesses tried to eek out every drop of productivity from employees and processes with managerial practices like Six Sigma–and then Lean Six Sigma–there are other strategies out there.  I think that, after looking at the information we’ve discussed, that there is a tremendous potential for a business that can successfully help businesses implement efficiency assessments that lead to a reduction in waste and energy usage.  There is one management strategy that seems especially promising called Multivariable Testing (MVT), and it involves testing a bunch of different variables aimed at improving the efficiency of a given process.  By experimenting on different methods of implementing the process, you can tell if a certain method is better, the same, or worse.  Along the way lessons are learned that can benefit other processes.(6)  Companies as large as Lowes have used MVT with success.  Certainly, however, there will be benefits to each of these managerial practices out there.  A successful business might aim to master all of them, and then help tailor an efficiency program for each client depending on the managerial practice that best fits them.
Sources:

1.  http://www.awea.org/Resources/Content.aspx?ItemNumber=5059

2.  http://www.epa.gov/statelocalclimate/state/topics/renewable.html#a03

3.  http://www.eia.gov/todayinenergy/detail.cfm?id=4850

4.  http://www.aceee.org/sector/state-policy/toolkit/chp/emissions

5.  http://www.cbo.gov/publication/44223

6.  http://www.bscdesigner.com/six-sigma-reviewing-of-alternatives.htm