Denmark vs. Virginia

In 1973 there was surprise and revulsion in the western world as the Arab world, upset at the US resupply of Israel after the surprise of the Yom Kippur attack, retaliated with a knife in the soft belly of the western world and embargoed oil supplies. For those old enough to remember, it was as rude an awakening to our collective 28-year comfort enjoyed since our victory in 1945. The western world’s reaction to the events of 1973 – 1974, while rhetorically very similar, were in fact were quite different in terms of real world action.

Almost to a country, the western world decried the moves as unacceptable and almost to a country vowed to reduce their dependence on foreign energy supplies. It is here that the story becomes very interesting both for the student of history and as an insight into the probable near term consequences of actions we will take.

In examining the reaction of a western country let’s first look at Denmark. They made the decision to commit themselves to a future that was not dependant on foreign energy supplies. They made commitments not only on the oil side, but also on conservation, heat and electrical generation. In the 1980’s they also made the decision not to allow any nuclear power plants on their soil.

In examining the reaction of the US, and specifically Virginia, we made a lot of verbal noise about energy independence and freedom from foreign energy sources. We made some first steps in the years from 1974 – 1979, but with the election of Ronald Reagan and the return of cheap oil, all focus was diverted and the goals were forgotten.

Why did this happen and what were the results? Well, the American public has never had a taste for putting off gratification today for the betterment of tomorrow, and the Danes were focused on two generations down the line. An examination of the results thus far is very telling. Here is a brief comparison between Denmark and Virginia.

The GDP per capita for Denmark is $37,300.00
The GDP per capita for Virginia is $46,521.00
Per capita Virginia is 25% richer than Denmark.

The population of Denmark is approximately 5.5 million.
The population of Virginia is approximately 7.7 million.
Virginia has 40% more people than Denmark.

Denmark (proper) is approximately 17,000 sq miles
Virginia is approximately 43,000 sq miles
Virginia is 153% larger than Denmark

Total energy usage per capita in Demark is 46,722 kWH/year
Total energy usage per capita in Virginia is 99,442 kWH/year
The average Virginian uses 113% more total energy than the average Dane.

Electrical energy usage per capita in Denmark is 6,506 kWH/year
Electrical energy usage per capita in Virginia is 13,662 kWH/year
The average Virginian uses 110% more electrical energy than the average Dane.

Cost of electrical energy in Denmark is $0.322 / kWH
Cost of electrical energy in Virginia is $0.104 / k WH
The average Dane spends $2,094 on electricity annually and the average Virginian spends $1,420 on electricity annually.
The average Dane spends $674 (47%) more on electricity annually than the average Virginian.

Percent sustainable energy (including hydro) in Denmark is 17.0%
Percent sustainable energy (including hydro) in Virginia is 2.6%
Denmark produces 554% more sustainable energy than Virginia.

So what do all these numbers tell us. Before I answer that I would like to tell the reader why I chose Denmark. Denmark has the highest cost of energy of any country in the European Union. Denmark also is consistently listed as one of the freest markets in the European Union and also had the least dependency on foreign energy supplies. I wanted to compare Virginia to a real world success story.

So, back to the numbers.

First, we see that Virginia is richer (per capita GDP), larger (population) and has more natural resources (gross land area) than Demark.

Second, there is a simple truth which shines thorough the second set of figures. There is a correlation between energy cost and energy usage. In study after study it has been shown that the higher the energy cost, the lower the usage. We see this in the US in states like Vermont, which has some of the highest energy costs in the nation, but per capita has the lowest energy usage.

Third, we see that this energy independence is costing the average Dane $1.85 per day more than the average Virginian.

So for less than a Starbucks Coffee per day, we could conceivable create a sustainable and foreign intervention free energy supply. Wow, sounds like a deal to me!

So what is standing in our way Virginia? Oh, I can answer that, political will and vision. Here are three items that happened to me at the Conference on Virginia Energy Symposium (COVES) in Mid October 2009:

(excerpts from by blog)

There were 400 or so folk who showed up, most of the regular characters you find at such things: solar, wind and biomass folks, utility reps, college facility people, politicians or there reps, etc..

As I circulated among the seminars and talked to the people at the conference, I got a very clear understanding of how far we are from grasping the scope of the change that needs to be made. At this symposium, I found just what I expected, many of the people on the front lines of energy policy change and renewable generation had a clear understanding of just how much has to happen in a small amount of time.

Unfortunately, the political folks had an inkling of understanding but a lack of will and vision. I will site three examples and you judge for yourself:

At a symposium where an Assistant Secretary of DOE gave a presentation, he discussed the much needed work to be done on existing buildings in the area of energy retrofits. He described energy retrofit as “not low hanging fruit, but fruit rotting on the ground”. There is a huge potential for energy reduction that is easily achievable and compared to other energy reduction strategies, relatively inexpensive. After the presentation during the question and answer portion I asked if we could get Fannie Mae and Freddie Mac to make it mandatory that any home purchased using their funds (which is the majority of all homes sold in the US) have an energy audit done. We could get folks used to having audits done and use this to quantify the homes energy footprint in an eye towards making energy upgrades mandatory with the sale of homes. This is a program that is not pie in the sky; rather it is currently being done in the UK. The answer was depressing a generic, "we are looking into many ways of encouraging energy audits". To me this was the failure to recognize two facts, first is that the US taxpayer now owns Fannie and Freddie (for all intents and purposes) and secondly it would take no political maneuvering, as Fannie and Freddie can impose that type of requirement at will.

The second was what happened at the final symposium, the summation of the conference. They had four speakers, one from biomass, solar and wind and one from the governor’s office. After the presentations during the questions and answer period I asked this question: I said that it seemed to me that all the presenters were ignoring the elephant in the room. Every alternative energy presenter lamented the fact that it is hard to compete with the cheap energy we have in Virginia, and that with little political and financial support from Richmond, the alternative energy community was facing a tough road. The elephant is Virginia's cheap energy. I asked the governors rep. this ~ since we all generally agree that we need sustainable, non-polluting sources of energy in Virginia and that we have cheap energy here in the olde dominion, why not use that as a positive and raise the cost of energy to create the revenue to pursue a faster switch to a sustainable future. The response was once again what I expected, the gov's rep started in saying that Virginia could not act "in a vacuum" and that making a change while the rest of the US and the world did not would hurt Virginia. I responded that we cannot abdicate our responsibility for energy independence and that is exactly what he was doing by making that argument. He said, "I did not say that" to which I said, "you most certainly did". With that the moderator took another question.

The third thing happened in a presentation by Dominion Power’s Vice President in charge of sustainable energy. She gave a presentation about the “smart meter” installations that Dominion was doing and bemoaned the fact that the customers did not seem interested in the monitoring abilities of the smart meter interface. She said that the customers were not monitoring their energy usage to lower their consumption. My hand shot up in an instant and I asked, why not have a usage carrot and stick. For example, if you use the base amount of energy you pay the base rate, but for every kWH you use over that amount the rate increases, and alternatively for every kWH you use under the base amount the rate decreases, I told her that I bet folks would pay attention to their usage then! She brushed my comment aside as unrealistic, but I muttered that I guess the meters aren’t as smart as they want to make out. I also asked her if we could institute a voluntary check box like the neighbors to neighbors fund to support customer generated energy (wind, solar, biomass). I let her know that right now North Carolina is doing this and it has almost tripled the amount of money going to the customer for electrical generation, without costing the utility a cent. Once again she said that she thought it would not work in Virginia.

So you see, this is the situation and the problem. Left in the hands of the politicians, who are guided by those with a lot of money and access and a vested interest in business as usual we are not going to see change.

So what I am asking is to think about the kind of Virginia you want for your grandchildren and act as if your actions today will have a direct effect on their lives, because they do.