Table 3.11 The Indicative Economics of Sustainable Energy Options

viable opportunities for greater energy effi ciency remain unimplemented because of various market barriers.8

The investments most likely to be undertaken will be partly driven by economic considerations (table 3.11). In this context, serious analysis may be able to identify short- and medium-term payback measures that a city may wish to pursue. The key challenge is the development of the best overall package of investments that is below an acceptable payback or other investment threshold. Access to special funding, such as concessional donor funds or carbon fi nance revenues, may increase overall returns, while maximizing the eff ect of the measures in the investment package.

Social equity requires cities to address issues of access and aff ordability among the poor. Artifi cially suppressing energy prices or providing universal subsidies is not an eff ective way to approach these challenges. City governments should target subsidies only on people who can-

Table 3.11 Indicative Economics of Sustainable Energy Options

SHORT-TERM PAYBACK, MEDIUM-TERM PAYBACK, LONG-TERM PAYBACK, SECTOR UNDER 5 YEARS 5–10 YEARS 10+ YEARS

Public buildings Equipment retrofi ts Building envelope measures Building codes Labeling building performance Green roofs Certifi cation of building materials Energy service company contracting Training in good practices in Building integrated photovoltaics Solar water heating building operations and Equipment standards maintenance

Public lighting Lighting retrofi ts using high- Retrofi ts using light-emitting Street and traffi c lighting pressure sodium vapor or diodes standards metal halide Redesign of lighting systems Control systems and sensors Transport Optimization of traffi c signals Alternative fuels for public Modal shifts Fuel effi ciency vehicle standards buses, taxis Vehicle inspection and Congestion taxes, tolls Bus rapid transit systems maintenance programs Changes in land use patterns to promote densifi cation Water, wastewater Pumping retrofi ts System redesign and n.a. Correct sizing of pumps optimization Leak reduction Methane recovery for power Load management generation from wastewater Energy service company contracting Water demand-side management (low-fl ow outlets, drip irrigation) Solid waste n.a. Methane recovery for power n.a. generation from landfi lls Recycling programs Electricity, heating Supply-side loss reduction Combined heat and power n.a. Power factor correction measures provision Improved metering and pricing Load management Renewable energy portfolio Energy storage systems standards Promotion of distributed Retrofi ts of boiler and piping generation with feed-in systems tariffs Cross-cutting Bulk purchase of effi cient products Procurement standards for Improved city design and Awareness raising on energy issues product procurement planning systems to public sector staff Agency awards and contests for energy effi ciency

Source: Author compilation (Jas Singh). Note: n.a. = not available.