How green can you go?

Conventional sources of energy based on fossil fuels are finite and will eventually run out. For every barrel of oil we discover, we now consume four. Shell estimates that, after 2015, supplies of easy-to-access oil and gas will no longer keep up with demand. At some point, probably in the next decade, when global oil production starts to fall, the world may enter a crisis as urgent as climate change and more dangerous than terrorism.

The economics are simple: If the world demands more oil than it can produce, prices will rise. And, as production inexorably goes into terminal decline, oil prices will rise exponentially. Such price volatility threatens competitively because we are totally dependant on fossil fuels. The global solution lies in curbing demand for energy as well as diversifying energy sources through renewable energy sources (RES).

Developed countries consume far more than the world can sustain; mostly because consumers do not pay the full price for the energy they use. The price of electricity does not factor in the massive environmental cost that would be involved to reverse climate change and regenerate the devastation in our ecological systems. Otherwise we would think twice when buying a new car, a household appliance or consumables that need to travel halfway around the world to reach us.

The world's long-term solution is to cut energy consumption and shift energy production from fossil fuels to "green power". The fact is, a wide variety of technologies exist today that, if applied correctly, could do much to bail us out of the energy corner we've painted ourselves into. And, in many ways, this is already happening. The drive for alternative energy or "green power" is being taken very seriously, so much so that US President Barack Obama has pledged to spend $150 billion over the next 10 years to promote renewable energy sources. "Green power" is now seen as one of the main solutions to an impending energy shortage and environmental meltdown.

Managing energy supply is not the only solution to our inherent problem. Managing demand through energy efficiency and conservation plays a vital role in the sustainability of our future. This means we must use energy more efficiently by cutting down on energy waste and by shifting towards technologies that are less energy hungry. For example, by switching off our television sets, rather than leaving them on stand-by, Malta could reduce over 1,000 tons of CO2 emissions. A household could save over five per cent of its electricity bill simply by switching off appliances rather than leaving them on stand-by.

Malta is compelled to reduce CO2 emissions by 20 per cent and generate 10 per cent of its energy by means of alternative sources by 2020. Even though Malta produces only 0.02 per cent of its energy from renewable sources, on-site renewable generation is taking off in Malta due to recent incentives and grants by the government. People can install their own renewable energy-generating equipment thereby reducing their dependency on national energy while lowering their energy costs. The fascination of renewable energy is that the source is free. Moreover, the cost of this technology is becoming more competitive every year. This is a step, albeit a small one, towards our contribution as "citizens of the world" to reduce our dependency on fossil fuels and strive towards a healthier environment.

Malta's national energy utility is playing a key role in shaping national energy policy for the future. Enemalta and the Water Services Corporation, supported through a strategic partnership with IBM, are embarking on an ambitious programme to make Malta the first country in the world to build a nationwide smart grid by 2012. This means that all existing electricity meters will be replaced by smart electricity meters and electronic probes fitted to water meters.

There are several reasons why smart metering should act a catalyst for the propagation of small-scale "green" micro-generation. Firstly, smart meters register excess "green" energy fed into the grid by consumers, allowing them to obtain credit on their electricity account. Secondly, the technology permits the introduction of tariff systems that will encourage customers to reduce their CO2 footprint and, in doing so, save on their electricity bills too. Thirdly, smart meter technology offers instant consumption display and detailed consumption representations, making people aware of their consumption patterns, thus helping them shift from energy-hungry appliances to eco-friendly ones and to shift consumption patterns from peak to off-peak hours. Shifting consumption from peak to off-peak hours postpones expensive investment in generation capacity and reduces our yearly fuel-oil requirements.

Being a microstate has its advantages. Malta will be looking to attract research and investment in energy efficiency and "green" technology. Many will be watching closely as Malta embarks on integrated water and electricity efficiency initiatives and will be studying how we achieve our energy efficiency targets.

The author is policy and strategic manager at ARMS.