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Progress Watch

US sees renaissance in energy efficiency, led by Congress and big business

For decades, the US has been transforming into a more energy efficient society. But fresh impetus has come in the wake of a 2007 law embracing tougher appliance and auto standards. 

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"No one wants to waste energy," Callahan says.

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For business, the allure has been simple savings.

Hotels are installing smart air-conditioning units that shut off when a guest leaves an outside door open; fast-food chains are retrofitting their insulation; refrigeration warehouses are replacing hot incandescent lights with cooler LED ones.

"Those guys running forklifts, they're not in it for green-energy-save-the-world reasons," says Robert Day, a partner with Black Coral Capital in Boston and a leading figure in clean-tech investing. "They're in it because it makes dollars and cents."

Federal laws and tax incentives have provided a prod, but much of the credit also goes to economic forces. As energy costs have crept higher, businesses have been reevaluating how and when they use electricity and fuel. Suddenly, replacing old light bulbs with intelligent lighting has become a sensible way to cut costs, say energy experts.

The efforts go beyond the marketability of slapping a "green" label on a company. "During the past 10 to 15 years, we've really seen [energy efficiency] emerge, driven by cost issues," says Callahan. "Once you get into it, you see you can save money but also be a good corporate citizen. It's a win-win."

Yet the trends are not uniformly positive. The businesses emerging as leaders are typically large corporations that not only have capital but huge operations that can be streamlined. Many smaller businesses have yet to follow suit.

Moreover, some areas of the country, such as the South, have done little to improve energy efficiency, particularly when compared with regions like the Northeast and West Coast. Mississippi, for instance, has no energy-efficiency codes for appliances or buildings.

Some conservatives in Congress now want to repeal parts of the 2007 energy act, too.

The biggest problem, however, might be among consumers themselves. While appliances – and the houses they're in – have become vastly more energy-efficient, Americans have used those savings to buy bigger houses with more energy-eating appliances, resulting in no net improvement in household energy consumption per capita since 1970.

But there are some signs of change, especially at a time when a troubled economy is compelling many Americans to save money. Next Step Living in Boston helps homeowners maximize energy efficiency. Says owner Geoff Chapin: "Three years ago we were about four people, and now we're 220."

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