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Energy Efficiency Mandates What Are They About? Do They Work? 2009 NASUCA Mid-Year Meetings

Energy Efficiency Mandates What Are They About? Do They Work? 2009 NASUCA Mid-Year Meetings Cynthia Mitchell, Principal Energy Economics Inc. DOE’s 2006 National Action Plan for Energy Efficiency “NAPPE”.

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Energy Efficiency Mandates What Are They About? Do They Work? 2009 NASUCA Mid-Year Meetings

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  1. Energy Efficiency Mandates What Are They About? Do They Work? 2009 NASUCA Mid-Year Meetings Cynthia Mitchell, Principal Energy Economics Inc.

  2. DOE’s 2006 National Action Plan for Energy Efficiency “NAPPE” “Modify policies to align utility incentives with the delivery of cost-effective energy efficiency, and modify ratemaking practices to promote efficiency investments.”

  3. Energy Independence and Security Act of 2007 “EISA” Modified PURPA 1978 to promote EE investments • Align utility incentives with the delivery of cost-effective EE • Remove the throughput incentive (aka “lost revenues”) • Provide additional utility incentives

  4. American Recovery and Reinvestment Act of 2009 • “Ensure utility financial incentives are aligned with helping customers use energy more efficiently.” • “Provide timely cost recovery and timely earnings opportunity for utilities with cost-effective measurable and verifiable energy savings.”

  5. Back to the Future • CA decoupling; 2007 net benefits /shared savings IOUs 9 – 12% sharing rate • Jim Rogers, Duke Energy net benefits / shared savings IOU 80% sharing rate • Arkansas: decoupling; lost revenues; addtl. utility incentives • New Mexico: decoupling; 1 cent kWh & $10 kW lifecycle EE savings paid in Year 1.

  6. CA Cumulative Energy GWh Savings: Utility EE Programs and Bldg. & Appliance Standards

  7. Per Capita Electricity Use in the U.S. and CA: 1960-2004

  8. March 2009 PUF Article CA electricity per capita consumption: correlation or “cause and effect” • < 20% energy efficiency savings • > 20% CA electricity prices • 20% CA moderate cooling season Trend: decrease industrial energy intensity; larger households; more MF dwellings; “conservation ethic”

  9. CA Cumulative Energy GWh Savings: Utility EE Programs and Bldg. & Appliance Standards

  10. Re-ordered CA Cumulative Energy GWh Savings: Utility EE Programs and Standards

  11. Let’s Talk CFLs…. • Wal-Mart effect • Market transformation • CFL quality: utilities vs. “Wal-Mart” • Legislative phase-out incandescents • Ratepayers as consumers pay 2 times+ • Residential lighting largely winter off peak • Negative interactive effects

  12. What is (?) Working • Efficiency Vermont 1990; Efficiency Maine 2002; Delaware Sustainable Energy Utility 2007 • Northwest Energy Efficiency Alliance (NEEA); Northeast Energy Efficiency Partnership (NEEP); Midwest Energy Efficiency Alliance (MEEA) • State public – private partnerships: Connecticut, Illinois, Maryland, Minnesota, New Jersey, New York; Ohio

  13. Closing Thought: FINANCING! We currently have on-bill financing for power plants, and T&D. We must be able to pay for energy efficiency and other sustainable resources in a similar manner.

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