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Accounting for Energy Efficiency Programs in Regional Load Forecasts

In a presentation to the Massachusetts Department of Public Utilities, Tim Woolf highlighted the shortcomings of the ISO's current methodology for forecasting energy efficiency savings. He emphasized that actual program savings often exceed those forecasted and that future efficiency savings should not be underestimated. The presentation discussed challenges in load forecasting, such as state diversity and monitoring issues, and provided recommendations for improving collaboration between the ISO, states, and program administrators to enhance data accuracy and forecasting methodologies.

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Accounting for Energy Efficiency Programs in Regional Load Forecasts

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  1. Accounting for Energy Efficiency Programs in Regional Load Forecasts Tim Woolf Massachusetts Department of Public Utilities Planning Advisory Committee Meeting December 16, 2010

  2. Overview • The ISO’s current methodology of forecasting energy efficiency savings in New England clearly understates likely future savings. • Program Administrators tend to save more in practice than they bid into the FCM. • ISO assumes that no new efficiency savings will occur in future years. • While there are several uncertainties in forecasting energy efficiency savings, these can be addressed through proper planning practices. Tim Woolf - Massachusetts Department of Public Utilities

  3. Recent MA EE Savings, and Current Plans:Capacity Savings (MW) Tim Woolf - Massachusetts Department of Public Utilities

  4. Recent MA EE Savings and Current Plans Tim Woolf - Massachusetts Department of Public Utilities

  5. EE Savings Compared with ISO Forecast:Capacity Savings (MW) Tim Woolf - Massachusetts Department of Public Utilities

  6. EE Savings Compared with ISO Forecast Tim Woolf - Massachusetts Department of Public Utilities

  7. Projection of EE Savings – High Case Tim Woolf - Massachusetts Department of Public Utilities

  8. Projection of EE Savings – Moderate Case Tim Woolf - Massachusetts Department of Public Utilities

  9. Projection – Moderate Case vs. NESCOE Suggestion Tim Woolf - Massachusetts Department of Public Utilities

  10. Challenges to Forecasting EE Savings • Actual EE savings differ from FCM bids and FCM delivered. • Planned savings may differ from actual savings. • There are no plans that go beyond the next few years. • EE measures retire over time. What is the impact on load? • Challenges noted in RSP 10 (page 121): • State diversity of EE makes forecasting challenging. • Double counting concerns. • Monitoring and verification. • Fatigue of EE program participants. • Diversion of EE funding. Tim Woolf - Massachusetts Department of Public Utilities

  11. Preliminary Big Picture Recommendations • ISO should work cooperatively with States and EE Program Administrators to develop load forecasts. • Goal of the forecasting process should be to develop estimates of the most likely amount of EE savings, not the most conservative amount. • Program Administrators should provide ISO (and states) with all relevant data regarding EE savings (actual and planned) and FCM bidding, to support the forecast effort. • States should provide input with regard to expected levels of efficiency funding and savings in future years. • Could be coordinated through NESCOE. Tim Woolf - Massachusetts Department of Public Utilities

  12. Options to Address Challenges - I • EE savings differ from FCM bids. • Analyze the two separately. • Planned savings differ from actual savings. • Review historical results, get input from PAs. • There are no plans after the next few years. • Get input from States and PAs about legislative and regulatory context that will drive future activity. • EE measures retire over time. • Make reasonable assumptions about measure replacement. • State diversity makes forecasting challenging. • Get data and input from each state. Tim Woolf - Massachusetts Department of Public Utilities

  13. Options to Address Challenges - II • Double counting concerns. • Identify and develop methodologies to address. • Monitoring and verification. • Clarify the issue. Improve M&V standards if necessary. • Fatigue of EE program participants. • Not an issue for EE (passive DR). • Diversion of EE Funding. • Get input from States. Apply a discount factor if warranted. Tim Woolf - Massachusetts Department of Public Utilities

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