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This chart from Lawrence Livermore National Laboratory provides a simple clear way to understand how energy is used in the US.
Energy sources are on the left side – solar, nuclear, hydro, wind, geothermal, natural gas, coal, biomass, petroleum.
Energy users are broken in to four categories a€“ residential, commercial, industrial, and transportation.
The gray boxes on the right sum up the energy that was used and the energy that was lost (rejected).
The width of the lines running from the various energy sources to their destination uses is proportional to the amount of energy used. As can be seen, the lion’s share of US energy consumption comes from fossil fuel sources (oil, coal, natural gas). Zooming in to the transportation sector, we can see that most of that oil is used for personal vehicles (cars, light truck and SUVs). Any attempt to reduce our dependance on oil will require grappling with transportation in general, and personal transportation in particular.
Personal transportation is 4 to 10 times less efficient than public transportation (commuter rail, trains and buses). WELCOME!Thank you for visiting 8020 Vision a€“ connecting the dots between global challenges and sustainable solutions.
The pie chart on the left displays the percentage of each energy source that was consumed (or used up) in the United States in 2007.
Sustainable (renewable) energy sources include biomass, hydroelectric, geothermal, wind, and solar. Non-renewable energy sources include petroleum (crude oil), natural gas, coal, and nuclear.
Electricity imports are electricity mostly imported from Canada that is generated from hydroelectric power plants. The bar graph on the left displays the amount of each energy type that was consumed in quadrillion BTU.
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Russia is naturally aware of the economic value of its primary fuel exports, particularly natural gas, and improving the efficiency of fuel production and consumption makes good economic sense.
Primary energy supply in Russia (excluding electricity trade) runs at around 700,000 Mtoe with, 25% used in transport, around 30% in industry the remainder being in commercial, residential and agricultural use. Considering the high penetration of both district heating and CHP in the Russian economy as a whole, it might be assumed that the areas of the economy involved would be highly efficient in their own right.
Although Russia has over 50 GWe of CHP installed capacity there is little published data on the efficiency of these plants.
Estimates by the IEA suggest that raising the efficiency of Russia’s CHP plants and reducing the losses along its district heating network could yield energy savings through improved efficiency of 20-30%. Energy efficiency has been a key element of Russian energy policy thinking for the past 15 years.
Maybe driven by its economic strength as a supplier of energy, Russia’s growing attention to energy savings is visible for example in its focus on capturing all the areas of the energy supply and consumption chain under the legislation. Both Russia and the European Union are beginning to consider the efficiency of the whole energy supply chain as being key to making progress.
One of the biggest differences between EU energy efficiency legislation and that of Russia is the absence in Russia of focused legislation addressing the economic and non-economic barriers to the wider uptake of efficient CHP. In a just published report highlighting the likely future role of cogeneration COGEN Europe outlines a high efficiency scenario for 2050 in which at least two thirds of cogeneration will be renewable based. In its scenario ‘Cogeneration 2050’ COGEN Europe has taken the various existing projections for fuel mix changes achieving 85% CO2 reduction and prepared a “high efficiency low carbon” vision of 2050.
The cogeneration sector supplies both heat and electricity simultaneously, cutting across traditional economic and commercial boundaries.
COGEN Europe welcomed experts from around Europe in today’s Annual Conference “Cogeneration at the foundation of Europe’s energy policy”. MEP Vidal Quadras, addressing the conference, highlighted the need to improve the energy efficiency of Europe’s energy delivery systems.
Fiona Riddoch, Managing Director of COGEN Europe, said “The opportunity is clear: Europe must now move beyond the “Why cogeneration?” to the “How cogeneration?” stage. The COGEN Europe’s Annual Conference highlighted the significant role which cogeneration already plays in Europe’s energy mix. Of the fossil fuels, oil is the source most in demand, the bulk of which is used by the transportation sector. When oil prices rise quickly, as they did in 2008 (to over $140 per barrel), consumer behavior shifts rapidly.
A much smaller amount of electricity is imported from Mexico to the State of California that comes from natural gas plants.

Improved efficiency frees up additional volumes of energy for export from Russia, while also enhancing the security of export supply. There was a dramatic decrease in energy consumption in Russia as a result of the decline in GDP growth over the market transition years of the 1990s where Russia saw its GDP fall by 50%. CHP accounts for around one third of the installed electricity generating capacity, hydroelectricity is 20%, nuclear is 10% and the rest is traditional thermal condensing generation. However, those who have studied the sectors suggest that an absence of good data and underinvestment in the infrastructure mean that there is a huge opportunity for improving the energy performance in these areas. Moreover, there is little direct policy structure around CHP despite its significant position in the economy and its considerable potential. Russia consumes the equivalent of about 150 billion cubic meters of natural gas a year in its district heating, savings of 30-50 bcm (roughly two thirds of Germanys total gas usage per annum) which could be achieved by action on CHP and district heating would release that gas for export rather than let it be wasted internally. Over the past 5 of these years legislators have moved to develop policy to create the necessary framework for action.
The European Parliament is currently discussing a proposed Energy Efficiency Directive which looks at the full energy supply chain.
There are some learning experiences from the European Union which Russia might want to consider should it decide to move forward with legislation on CHP. However, for district heating to deliver energy efficiency savings compared to individual installations the heat network itself must be highly efficient (achievable with modern distribution technology) and the overall efficiency of the system should be optimised.
The industries of paper, chemicals, refining, food, ceramics and more, use CHP routinely and effectively. However, the poor current performance of the sector must be radically improved if this is to be achieved.
Building on the previous report ‘Cogeneration as the foundation of Europe’s 2050 low carbon energy policy’ released in December 2010, the new report shows the significant role which cogeneration can play in the sustainability of renewables lifting the overall efficiency of bio–energy use.
They came to take the temperature of the sector and to hear how the European Commission plans to encourage the wider use of cogeneration as it outlined in its recent Energy Efficiency Plan. The European cogeneration sector holds the source of a clear 20% of the missing 200 mtoe savings. Today 11% of all of Europe’s delivered electricity is generated in cogeneration mode in plants ranging from industry to private homes. Understanding the energy trends shaping our world is essential to managing risk and innovating solutions for business, government and community.
Within Russia itself, natural gas is the leading single primary fuel consumed representing 55% of primary fuel consumption.
This low level of consumption has continued in the 2000s, showing a permanent shift in economic activity. Due to the history of expansion of industry and of the urban areas and cities of Russia, there is an extensive use of district heating in Russia’s cities often supplied with the useable surplus heat from local industry as the source. Iron, steel, chemicals and petrochemicals make up over half of the industrial heat consumption in Russia. District heating may be associated with CHP but it is not always the case and district heating relies heavily on the efficiency of its distribution network and on a CHP element to deliver significant primary energy savings compared to separate production.
More than half of this length is estimated to have exceeded its technical lifetime of 20 years and 25-30% is considered to be in a critical condition according to the IEA. Trends in the focus of energy efficiency legislation in Russia seem to be moving in a very similar direction to the European Union, with more focus on energy efficiency in general and providing a policy structure to deliver this as growing awareness of  the significant role of energy efficiency encourages more legislative action. Although the absolute level of flaring of associated gas in Russia is unclear, it is of concern to the government. Until now European energy efficiency and savings legislation has been fragmented across several different directives. The main barriers which Russia’s district heating seems to face is a convincing business model which supplies the customers with the comfort and control level they expect, at  a price which is reasonable. At a time when industry is challenged by high labour and materials costs in Europe, it is possible to add an additional income stream of low carbon electricity sales to the profit and loss account if the policy structure in place removes the barriers for new players to enter the electricity market, and encourages and rewards high efficiency. In a 2050 world of highly electrified transport and better insulated buildings cogeneration emerges as the logical mode of supplying low carbon process heat to industry. The European Commission has indicated that cogeneration basically stood still from 2004-2008 with only 0.5% growth per annum. The Conference, the largest European event on cogeneration in 2011, demanded a central role for the integrated energy thinking embodied in cogeneration at the heart of Europe’s energy and climate strategy. These have already been identified by the Member States in their responses to the Cogeneration Directive.
Cogeneration simultaneously is providing the industrial heat and the space heating to those users. Russia’s district heating network delivered 1,700 TWh of heat in 2007, supplying 80% of Russian residential buildings.
All these industries have been badly impacted by the structural change in the Russian economy and as the ability of CHP plants to deliver energy savings depends on their reliable operation “as designed” with all the electricity produced and all the heat produced being consumed, radical changes in either demand or supply have a potentially large impact on efficiency performance.

Raising the investment to replace, repair and maintain this immense network is the key challenge facing Russia’s district heating system network. The new Russian Energy Efficiency Law of 2009 focuses on energy end use with the declared aim of creating a legislative, economic and organisational stimulus for energy savings and increasing energy efficiency. End use energy efficiency was promoted through the Energy Services Directive, CHP through the CHP Directive and other wide ranging measures through the Energy Efficiency Action Plan 2006. The Directive did this by putting in place a transparent methodology for calculating the energy savings from CHP and introducing a threshold of efficiency performance for CHP (high efficiency CHP) which must be reached or exceeded if the CHP plant can benefit from particular Member State support schemes. Since the 2000 there has been increasing momentum in refurbishing existing boiler houses with smaller scale CHP units (<25 MW). The report includes new fuel flow diagrams for the European economy, visualising the intricate pathways of energy through the economy and highlighting the key transformation and distribution points.
Neither the 2004 Cogeneration Directive nor the European Emission Trading Scheme regimes have stimulated investors to move into this sector. The expansion would save a minimum of 35 mtoe of energy, save 19 billion Euros a year at today’s oil prices in avoided imports plus generate much needed new jobs in Europe’s engineering sector (green sustainable technology and innovation). The cogeneration sector wants Europe to give more priority to cogeneration in meeting the 2020 energy and climate targets and to make cogeneration a fundamental element of energy strategy to 2050. Commuters embraced public transportation, with many metropolitan areas seeing 30 to 45 percent increases in use of public transportation in just one quarter. Where a district heating network is accepting the heat from a process it is easy to see how a downturn in the industry has a knock-on effect on its role as a reliable heat supplier, sending customers looking for alternative or backup supply.
Its effect extends to include water supplied, transferred and consumed using centralised water supply systems. In response, the Russian energy and environmental ministries produced a set of proposals to reduce flaring and a decree published in 2009 sets the goal of using 95% of the associated gas by 2012.
The interlinking network efficiency and particularly transformation efficiency itself were left to other instruments with a secondary impact on efficiency.
The Directive was not so successful at introducing new statistical recordings for CHP, but this too is considered highly desirable in the implementation of an effective energy efficiency strategy. If this can be achieved, investment in the heat network will follow based on the robustness of the plan. These developments take CHP into new applications, smaller heat networks, smaller factories. A further example, with implications for CHP, is the development of legislation around heat. The new Energy Efficiency Directive is ground breaking for Europe in the sense that it looks at the full energy supply chain, forcing consideration of all areas of conversion, supply and use and introducing the proposal for direct involvement of all primary energy using sectors, including the electricity sector. The emergence of a suitable environment for this will be the entry of third parties willing to support directly or jointly with others. There is an ever increasing range of CHP solutions for a widening range of capacity demands. Following the restructuring of the electricity market, the Russian authorities are now developing a new regulatory framework for the heating sector. For example, a recently announced large refurbishment of the Chelyabinsk district heating network by Fortum’s Russian subsidiary aims to reduce losses by 30% through automation and network upgrades and technical improvements at the power plants located in the Chelyabinsk region. All the European Institutions must now get real about energy efficiency policy and cogeneration and deliver a strong Energy Efficiency Directive”.
A co-ordinated and long-term strategy and policy structure which enables the companies with experience in district heating to operate in confidence with a reasonable investment horizon, would drive this kind of investment forward. The existing network represents an investment which in planning and construction terms would be difficult to repeat today except in the rapidly expanding economies and cities. In a similar way to the objectives pursued with the electricity reform, this law aims to modernise the sector which is currently characterised by the use of very old equipment and thus a high energy intensity. Examples of just such an approach in the European Union (Denmark, Germany and Flanders) have been successful. For district heating the challenge is to secure a solid business model which creates more customer demand for district heating, while providing adequate investment to upgrade the network and boiler house (to CHP) in a timely way. The European Union has toyed for the past decade with the idea of tackling the heat sector but failed to do so. Arguably this is a significant barrier to progress on CHP in Europe but one that Russia has already moved to address. With the extensive use of CHP in Russian industry and the relative contraction of that sector plus the age of the district heating network, there is considerable scope for improvement in efficiency through a focus on heat, its generation and use and how to efficiently adjust the existing system to the challenges of the current decade.

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