How to Deal with the American Energy Grid’s Massive Waste Problem

Ryan Duncombe, Beam Project

Photo by Daniel Larionov on Unsplash


Food waste has become a hot topic of conversation among environmental groups lately, and justifiably so. Americans throw out 30–40% of their total food supply, greatly expanding the footprint of land use, transportation, and waste management needed to feed Americans. But there’s an even larger, underappreciated source of waste in America, as more than two-thirds of the energy we produce leaves our energy system without ever being used. It’s lost, primarily through the form of heat, at the source of production, at the site of use (our homes, cars, businesses, etc.), or in transport along the way. This waste is well visualized in energy flow charts produced by the Lawrence Livermore National Laboratory each year. Not only are we in the U.S. wasting enormous amounts of energy, but we’re wasting more than most other developed nations, and we’ve been wasting a higher proportion of our energy over time. In 1970, America only lost 50% of its energy to the atmosphere, but now it’s approaching 70%. To build towards a low-carbon future this is one of many trends that will need to be slowed and eventually reversed, as limiting needless energy waste will be one of the most powerful ways of lowering America’s carbon footprint.

How we waste so much energy

The second law of thermodynamics — entropy always increases — forbids energy efficiency ever reaching 100%, or even approaching it. Nowhere is this law clearer than in the power generation sector. Every action — whether it be generation, transportation, or usage of electricity — exhibits loss, because no action is purely efficient. This is more easily imagined by walking through the lifecycle of an electron as it travels through the grid. For instance, the typical U.S. power plant converts the energy in fossil fuels to electricity through several intermediate steps. First, the stored chemical energy in either coal or natural gas is released as thermal energy in the process of combustion. This thermal energy, or heat, is then used to boil water into steam, which, by forcing its way through piping, converts the thermal energy into mechanical energy. As the steam is forced to pass through and rotate turbines, that mechanical energy is finally converted into electrical energy via a generator.

It is easy to imagine how, despite continued refinements by engineers, this system can generate a lot of waste as energy is lost at each conversion step. Heat from combustion can be lost through the furnace walls and piping, with only some entering and heating the water. Steam’s kinetic energy isn’t channeled exclusively into the turbines, but also into the walls of pipes and to generating friction. The turbines themselves must overcome friction and resistance in turning. This process of converting coal to electrons is only about 35% efficient, meaning 65% of the energy stored within coal and natural gas is lost before ever leaving the power plant.

Upon leaving power stations, the electricity that is produced first has to be transformed. This means converting it from low voltage/high current electricity to high voltage/low current electricity. Of course, this transformation is not perfectly efficient, and roughly 2% of electricity is lost in the process. But now the high voltage electricity can be transported long distances in power lines much more efficiently than if it were left as high current electricity, though it still exhibits a further ~5% loss. Upon reaching neighborhoods and businesses, it can be transformed back into low voltage/high current electricity that is useful and safe for our homes, but again contributing a 2% loss. And unfortunately, it doesn’t end there, as our homes and business continue to contribute to inefficiencies with everything from electronics to poor insulation.

By all these mechanisms and more, electricity production encounters physical constraints of efficiency. So, while two-thirds of energy is wasted, some of that loss would occur even in a theoretically ideal system, whereas some of those losses are recoverable. The important question is how much energy is of each category. Remarkably, it turns out that our current grid is nowhere near the practical limits of efficiency, as it’s estimated that at least half of the energy lost in the US could be recovered with more intelligent energy distribution and power usage. While it’s frustrating to know we’re needlessly wasting so much energy, it should also be encouraging knowing there’s ample room for improvement. But there’s no getting around it, efficiency is a large-scale problem and will require many solutions, each contributing some amount to the ultimate goal: an efficient, low-carbon grid.

How utilities can change

The cheapest, fastest, and most scalable way to waste less energy is to use less of it. Because two-thirds of energy is wasted, this essentially means that reducing energy consumption at the endpoint means even greater savings in energy production. And simply introducing energy efficiency goals has already been shown to reduce consumer energy usage significantly: Massachusetts saved families in one community $10 million in electric and gas bills simply by providing households with average energy usage numbers for their community and including tips on how to reduce their energy usage. This costs almost nothing to implement, and can dramatically lower energy usage country-wide. Only half of US states have any such program, so this remains an opportunity for swift progress (if your state has one, you can find its office of energy and its programs here). VEIC and Green Mountain Power are two utility organizations already working to increase efficiency and reduce energy usage as a means of benefitting their communities and the environment.

Additionally, time-of-use pricing can subtly encourage more optimal timing, spreading out resource usage and preventing utilities from requiring wasteful “peaker plants” that are cheap, dirty, and only used in times of maximum electricity demand. Or, as occurs in California, individuals installing household solar can be given the same favorable interest rates that utilities get for building their infrastructure. After all, rooftop solar is an extension of the electricity grid. Furthermore, the existing massive subsidies for coal, gas, and oil can be eliminated to let renewables compete on a level field. And if we truly wanted things to be fair, a carbon tax could be implemented to properly account for the financial burden of carbon in our atmosphere, as we now know that carbon has a very real cost that is currently unaccounted for on most balance sheets.

Efficiency Improvements and Energy Recuperation

A lot of the previously described inefficiencies can be improved with technology, or by changing the ways we use current technologies. LEDs and better building insulation can have huge effects, dramatically decreasing the energy needed to light and heat our homes and businesses and saving up to 2% in total energy usage. And as previously mentioned, lower use means lower waste. Improvements in grid and transformation efficiency could result in another 2–5% percent improvement in efficiency of electricity transportation. By targeting the many small sources of energy waste that occur frequently across the country, huge improvements can be made.

In addition to targeting the many small household and business sources of energy waste, targeting larger-scale industrial sources can have similarly large effects. One of the fastest ways to reduce carbon emissions is to improve the way industrial plants use energy from fossil fuels. It’s estimated that 20–50% of industrial energy is lost as waste heat in various processes. Arcelor Mittal, the world’s largest steel company, based out of Indiana, began operations to capture waste heat from their blast furnaces in 2005, using some of that waste heat to generate electricity. While some industrial facilities around the country have adopted similar techniques, for every facility capturing waste heat, there are 10 more yet to implement practices like this.

In addition to recovering waste heat, there are some growing technologies to recover energy from actual, physical waste as well. Two startups, LanzaTech and GRID Powr, are recycling carbon from industrial off-gases, biomass resources like municipal solid waste, and agricultural waste. They do this by using bacteria to recycle the carbon within these waste materials into new fuels that can be reintroduced into the energy grid. Technology like this has been in use in Europe for a decade, and can be especially important for filling in energy supplies when wind and solar aren’t available. By capturing as many waste streams as possible and redirecting that energy back into productive uses, we can help build a “circular grid”, decreasing the amount of new input (i.e. new fossil fuels) needed to keep up with demand.

Electrification at every level

An article on energy efficiency can’t ignore the elephant in the room: the biggest step that can be taken to improving our overall energy efficiency is widespread electrification and decarbonization. Generating electricity without fossil fuels would immediately reduce energy needs by a staggering 30%. This is a massive decrease, and comes largely from the fact that all those steps generating loss inside a power plant would be eliminated. A solar panel does have limited efficiency of conversion from solar energy into electricity, but the wasted solar energy can hardly be called consequential. In fact, it can hardly be called waste, as solar energy is “wasted” every day as the sun bathes the earth in its rays, the vast majority of which land without consequence (other than keeping the planet warm).

Furthermore, electrifying cars and trucks would reduce energy use by another 16%, as converting gasoline into the kinetic energy that moves vehicles is even less efficient than electricity production from other fossil fuels. Gasoline-powered cars waste about 80% of the energy stored in their fuel tanks as heat, meaning only about 20% is actually used to move the car. This represents one of the largest inefficiencies in the country’s energy usage. In contrast, the electricity used to charge the batteries in electric vehicles is, on average, 40% efficient. This means that, in addition to all the other benefits of electric vehicles, they’ll also increase the overall energy efficiency of our automobiles by two-fold over gas cars.


Energy waste in the United States is a massive problem, but there are a lot of low hanging solutions ready for implementation. Many, though not all, of these solutions will be expensive, but inaction has a cost, too. Energy waste amounts to more than $100 billion per year in excess costs to American consumers and businesses, so the earlier we invest in energy efficiency the more is saved in future costs. If you want to learn more about how your state produces and uses energy, you can find that information from the U.S. Energy Information Administration here, and if you want to see what energy-related bills Congress is considering (and potentially contact them about it), you can find that information here. Utilities management, waste recovery, electrification, and numerous other strategies all address different aspects of energy waste, and each of these approaches will have an important part to play in transitioning the American grid to a carbon-free future.

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