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Feb 14, 2012

Inside RMI: A Q&A with CEO Michael Potts


What do you say when people ask you, "What do you do?"

I’m the bandleader charged with channeling the brainpower of Rocky Mountain Institute’s brilliant architects, scientists, engineers and analysts to create real solutions that speed our shift to a new energy era powered by efficiency and renewables.

What new idea or innovation is having the most significant impact on the sustainability world?

Renewable energy costs, especially solar photovoltaics, are dropping more quickly than anyone expected.

Right now, photovoltaic solar plays a very small role in the national electricity mix, generating less than 1 percent of U.S. electricity. But things are beginning to change. Approximately two gigawatts of solar energy (equivalent to two traditional nuclear plants) were installed nationwide in 2011 alone, and prices for electricity produced from solar systems is cost competitive with utility rates in an increasing number of markets.

This is shaking up all players in the electricity sector—utilities see big challenges coming, solar entrepreneurs and their investors face brutal competition and disruptive change, and policy-makers are two years behind the curve. At RMI, some of our best minds are working across traditional industry boundaries to chart a path forward.

What's something that most people just don't understand about your area of expertise?

One billionaire refused to believe that a new commercial building could be designed to consume dramatically less energy than a standard building at about the same capital cost.

“If it was really possible,” he challenged me, “everyone would be doing it!”

But it is possible. Our recent book Reinventing Fire shows a $1.9 trillion opportunity on the table for smart building owners and entrepreneurs to adopt straightforward efficiency techniques that can drive 38 percent less energy use nationwide, despite 70 percent more floor space.

Proven and practical solutions to many of our energy dilemmas exist today—in transportation, buildings, industry, and electricity—but the barriers to implement them are buried in perverse incentives, outmoded business models and often simple lack of understanding. Busting these barriers is our work at RMI, and the biggest of them is the inertia of conventional thinking.

What's an emerging trend that you think will shake up the sustainability world?

The field of “sustainable finance” is shifting into high gear. Courageous pioneers, like the owners of the recently retrofitted Empire State Building, drove innovative efficiency projects before their paybacks were commonly proven. Now, the data from these pioneering projects is coming in, allowing analysts to prove a strong financial case that efficiency and renewable energy investments pay back, often far beyond simple cost savings. This is driving innovation more quickly into the mainstream.

RMI is working to establish a new Center for Sustainable Finance to help speed this trend. In the meantime, have you noticed that Berkshire Hathaway is now investing in solar projects?

What's a sustainability trend that you wish would go away?

As far as I’m concerned, the more the merrier.

What's an idea you became fascinated with but that ended up taking you off track?

Scare tactics. We face real consequences to our climate and environment and economy and security if we don’t tackle our energy challenges. And I have spent a fair amount of time understanding those consequences. But, like many of my colleagues, I found that discussing long-term downsides rarely drives an immediate change in behavior.

At RMI, we focus on creating a better future. And we spend a lot of effort helping leaders and stakeholders find ways to win this year as they bring us toward a new energy era.

Who are three people or organizations that you would put in a Hall of Fame for your field?

First is RMI’s co-founder, Amory Lovins. RMI is about to celebrate its 30th anniversary, and Amory continues to tirelessly serve as our chairman and chief scientist. Amory is courageous, insightful, and relentless and his ideas have literally transformed industries.

Next is Paul Hawken, who also has a deep grasp of this field and expresses his insights with passion and virtuosity.

Finally, Yvon Chouinard. His Patagonia walks the talk and reflects Yvon’s hard-nosed rigor and candor.

What other field or occupation did you consider going into?

I was a high-technology executive and entrepreneur for 25 years before I joined RMI. Before that, my college major was creative writing—I wanted to be a novelist, but I’m probably too much of an extrovert to pull that off.

What website or app most helps you do your job on a daily basis?

At RMI, we are serious Googlers: Gmail, calendar, Google docs, the works. Those tools really encourage collaboration and sharing—two things we’re all about at RMI.

What song's been stuck in your head lately?

“Fixing a Hole” by the Beatles came up at random during a recent workout and I can’t shake it.

Highlighted Resource

Letter from the CEO: Breakthroughs Behind the Scenes

An introduction to the energy innovators featured in the Winter 2012 Solutions Journal Read More



Showing 1-2 of 2 comments

February 21, 2012

I agree energy efficiency is an obvious solution and has clear economic benefit for the average building owner. Sadly, the average building owner hasn't a clue. Perhaps we advocates can "drive" energy efficiency, though individuals hold the key to the door of their facility or residence.
Does RMI study PROGRAM design?
I have contacted more than 200 activisits, policy study shops, govt representatives & administrators, NFPs, foundations, etc. throughout the US inquiring if there is one efficiency program for residences and the 90% of businesses that are less than 10k sq ft, that assures a positive result. I welcome a conversation. Please inform me if there is one program.

February 23, 2012

I appreciate all of the dedicated work RMI has done to educate the public and industry on the financial and environmental merits of energy efficiency and alternative energy. When people realize that it pays to invest in energy efficiency, the first barrier to invest in it is eliminated. The last barrier to over come is the upfront costs.

I am discovering, through my own business, that lending institutions are opening up to the idea of loaning money to businesses to fund the upfront costs of energy efficiency. I have found rates as low as 2.75% to 4% depending on the length of the payback period. The loans are always structured to be repaid with the energy savings generated from the retrofit. This eliminates the last major barrier to investing in energy efficiency.

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