Reviving a Suppressed Technology – Part 2
The economics of Dennis Lee’s heat pump
The previous post covered the science of Dennis Lee’s heat pump. It was invented almost by accident by a Colorado cowboy and his engineer friend during the Oil Crisis in 1974. They did not know that they had stumbled onto a thermodynamic advantage with those big panels. They were just trying to make them look like solar systems.
When I first wrote my energy-racket essay in the early 2000s, I had a section on energy economics. The numbers could be startling. British citizens had 200 times the per-capita income that Ethiopian citizens did, but their per-capita incomes divided by energy consumption were nearly identical. Energy is wealth, as Bucky Fuller noted. Fuller stated that if oil was priced at the benefit that humanity derived from it, it would cost $1 million per barrel, and I have presented calculations that show how that is. Americans are the greatest energy consumers in world history, the USA is history’s richest and most powerful nation, and that is no coincidence. But that explosive growth in energy consumption came to an end during that first oil crisis. American per-capita energy consumption has fallen by 20% since the peak year of 1979 (the first peak was 1973, and it recovered to a new high in 1979, for the second oil crisis). That decline meant a decline in the American standard of living, which I have also illustrated. American conventional oil production peaked in 1970, and we are mining the dregs of our oil deposits. At current trajectories, in this century, nearly all oil on Earth will be gone, mined and burned.
In 1970, American homes were not insulated, with all of that cheap energy, and home furnaces were as little as 50% efficient. The oil crisis wiped out Dennis’s first business, which was home renovation. Most of my free-energy colleagues got involved in energy because of the energy crisis, which ended history’s most prosperous period.
In the wake of that first energy crisis, Americans began learning the virtues of energy conservation. Dennis got involved with home insulation. He had already demonstrated his genius as a businessman with his previous business that tried to unite the consumer, Utopian thinker that Dennis was. Dennis did all of that in New Jersey, of all places, where he went to escape the Mob in Alaska. Mobsters constantly tried muscling in on his businesses, and Dennis survived several Mob hit attempts.
In the insulation business, Dennis tried to industrialize it, replacing a man with a hose, bucket, and foam mix (which had poor quality control, which presented a health hazard), with a “battlewagon” that had computer-mixed foam that could insulate a neighborhood in a day. Dennis applied his industrializing genius to that heat pump that he stumbled into around 1979.
The milieu that Dennis encountered, with inefficient furnaces, terribly inefficient heat pumps, uninsulated homes, and a huge tax credit that Carter enacted, is a long-gone era. The first thing that Dennis did after stumbling into that heat pump was design his shared-savings program, in which he used the tax credit to put the heat pump on people’s homes for free, and they paid the rest of the balance on their proven savings on their energy bills. It is still the most brilliant and benevolent business strategy that I ever heard of. Dennis always thought big, and immediately began thinking of how he could carpet the USA with his heat pump.
When I wrote my original essay, electricity was four times as expensive as natural gas (remember those losses in converting fuel to electricity). If we get away from pricing and just consider energy terms, if gas is converted to electricity at 40% efficiency and Dennis’s heat pump got a coefficient of performance (“COP”) of six, then it produced 240 units of heat (40 X 6), when burning the gas for heat would only produce 100. Stated differently, Dennis’s heat pump produced 100 units of heat at only 42% of the energetic cost as burning gas in a furnace would. When gas furnaces were only 50% efficient, then it only took about 20% (40% X 50%) of the energy to produce the same heat in a home as using a gas furnace. When air-to-air heat pumps got COPs of two and Dennis’s got six, then it delivered heat at only one-third of the energy used in an air-to-air, and only 16% (1/6) of using baseboard electric. In that recent interview, I said that Dennis’s heat pump reduced the energetic cost by half or more than half, when the reality was more like 60%-to-85% energetic savings. Air-to-air heat pumps are a big deal today, and I just laugh when I hear about them. Today, conventional heat pumps average between a COP of three-to-four, up from the two of 50 years ago (but I still see COPs of two being touted, and COPs of three are being called hot stuff). My guess is that if Dennis’s heat pump was revived and modernized, its COPs might average seven-to-eight.
In 2011, gas was used for 70% of residential heating, only 8% was with electricity, and the residential-heating market was $100 billion per year. I doubt that the numbers in this post have changed much since I first wrote them.
But there is no longer a generous tax credit, people insulate their homes, furnaces are more efficient, and air-to-airs are better. But even today, Dennis’s heat pump would reduce the energetic costs of heating by more than 50% over gas heating and maybe much more, if it was properly resurrected.