New Englands Maximum Achievable Energy Efficiency Potential

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New Englands Maximum AchievableEnergy
Efficiency Potential
The Economically Achievable Energy
Efficiency Potential in New England

• Updated Spring 2005

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Overview

• 1. What is the Economically Achievable Energy
  Efficiency (EE) Potential in New England?
• 2. How much EE is needed to offset forecasted
  load growth?
• 3. What are the major reservoirs of EE
  potential?
• 4. How can New England capture this EE potential?
• 5. What are the costs versus benefits of this EE
  potential?
• 6. How much can EE help reduce power plant
  emissions and help meet regional climate change
  goals?
• 7. How much can EE help reduce natural gas demand
  for electric power generation in New England?
• 8. Recommendations to New England policymakers.

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What is Economically Achievable Energy
Efficiency Potential?

• The potential for maximum market penetration of
  energy efficient measures that are cost-effective
  based on the Total Resource Cost test, that could
  be adopted through a concerted, sustained
  campaign involving proven programs and market
  interventions, and not bound by any budget
  constraints.

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What is Economically Achievable EE Potential in
New England?

• 10-year analysis timeframe 2004 to 2013
• Results
• By 2008 Savings of 17,103 GWH and 4,317 MW
• (Equivalent to annual electricity needs of 2.4m
  households, and 14 combined cycle gas units _at_ 300
  MW)
• By 2013 Savings of 34,375 GWH and 8,383 MW
• (Equivalent to annual electricity needs of CT
  and NH households combined, and 28 combined cycle
  gas units _at_ 300 MW)

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How Much EE is Needed to Offset Forecasted Load
Growth in New England?
16,500 GWH _Savings
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What are the Major Reservoirs of Achievable EE
Potential in 2013?1 By Sector
Residential Savings 12,745 GWH
CI Savings 21,630 GWH
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What are the Major Reservoirs of Achievable EE
Potential in 2013?2 By End Use
Residential Savings
CI Savings
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What are the Major Reservoirs of Achievable EE
Potential in 2013?3 By Market
Residential Savings
CI Savings
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How Can New England Capture Achievable EE
Potential?

• Continue existing ratepayer funded EE programs
• Implement and enforce building energy codes
• Adopt proposed state and federal minimum
  efficiency appliance standards
• Expand procurement rules for state and municipal
  facilities and equipment purchase
• Adopt or expand resource acquisition role of EE
  to meet specific state and regional electric
  supply needs (e.g., demand response, TD
  requirements, default svc. options)
• Increase ratepayer funding for EE programs

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Energy and Demand Savings Potential by Key
Strategies in 2008 vs. 2013
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Existing Strategies Will Capture Less Than20 of
Achievable Potential Savings by 2013
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What are the Costs vs. Benefits of the
Economically Achievable EE Potential? (Using
Modified Total Resource Cost Test)
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How Much More Investment in EE Is Needed to
Offset Load Growth in New England?

• Current/pending policies can offset 50 of
  growth
• New England electric ratepayer funding for EE
• 200 million/year
• 2 billion over next 10 years.
• Building energy codes and proposed state
  standards
• 700 million over 10 years.
• Additional investment to offset load growth
• Additional 2.6 billion needed from 2004-2013
  (more than double current SBC funding levels).

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How Much Could EE Help Reduce Power Plant
Emissions in New England?
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New England Governors Conference Climate Change
Action Plan Goal Stabilize CO2 Emission at 1990
Levels by 2010

• Focus on New England Stationary Combustion Sector
  (fuel burning in power plants, factories, homes
  and buildings).
• Stationary Combustion CO2 Emissions Growth
• 1990 103 mm tons actual
• 2000 116 mm tons actual
• 2010 138 mm tons projected
• CO2 Emissions Growth after achieving full EE
  Potential
• 2010 114 mm tons ? 24
  mm tons
• 68 of NEGC 2010 carbon reduction goal for
  stationary combustion

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How Much Could EE Help Meet NEGCs CO2 Reduction
Goal by 2010 for Stationary Combustion Sector in
New England?
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Electric EE Could Reduce Forecasted Natural Gas
Demand for Electricity Generation in New England
by 7 to 45 by 2013
Source ISO-NE Natural Gas Demand Forecast 2004
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Cumulative Impact of Achievable Electric EE
Potential on Reducing Natural Gas Demand for
Electric Generation in New England
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Findings and Conclusions

• Continuing New Englands current EE policies over
  next 10 years would target less than 20 of
  economically achievable EE potential.
• EE is 67 cheaper than the cost of electric power
  supply.
• Cost-effective investments in EE can more than
  offset projected system electric energy and peak
  demand growth, deferring the need for 28
  combined-cycle gas units of 300 MW of output
  each.
• Economically achievable EE is abundant in all
  customers sectors, end uses, and markets.
• Investments in EE can help New England meet the
  NEGC climate change goals by 21-68 for the
  Stationary Combustion sector by 2010.
• EE can help meet mandatory carbon caps
• Investments in EE can help reduce projected
  natural gas demand for electricity generation in
  New England by between 4-25 in 2008 or as much
  as 7-45 by 2013.

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Recommendations to New England Policymakers

• Integrate EE into regional system and
  distribution company planning and resource
  procurement.
• Link energy facility planning with environmental
  and economic policies.
• Give high priority to building energy code
  updates and high levels of compliance.
• Continue to adopt state product efficiency
  standards.
• Support strong and timely adoption of federal
  product efficiency standards.

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Recommendations to New England Policymakers,
Continued

• Increase funding for EE investments as a clean
  and cheap energy supply resource.
• Adopt or expand EE procurement rules for state
  and municipal buildings.
• Use electric EE to relieve gas supply constraints
  and help mitigate energy price volatility.
• Assess role of increased electric energy
  efficiency in new gas supply facility siting
  reviews.
• Establish common, regional methods and
  assumptions for measuring EE savings in New
  England.

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Achievable EE Potential Underlying Assumptions

• Savings based on savings by sector from
  existing EE potential studies for MA, ME, CT, VT
  (extrapolated for NH and RI).
• Eliminated double counting by assuming some
  overlap of codes (12.5) and standards (25)
  savings with savings from potential studies.
• Program Measure Cost/kWh by sector in VT ME
  potential studies applied to other New England
  states sector savings.
• Benefits of avoided supply based on "Avoided
  Energy Supply Costs in New England", prepared by
  ICF for the AESC Study Group, August 21, 2003.
• Assumed 2.9 real discount rate

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Key Sources Used in Analysis

• 2004 Connecticut ECMB Final Report
• (GDS Associates/Quantum Consulting)
• 2003 Vermont Dept. Public Service Study
• (Optimal Energy/Vermont Energy Investment Corp.)
• 2002 Maine Public Advocate Study
• (Optimal Energy/Exeter/Vermont Investment Corp)
• 2001 Massachusetts Utilities and DOER Study
  
• (RLW Analytics and Shel Feldman Associates)
• 2001 NEEP Codes Standards Analysis (NEEP/ACEEE)
• 2004 ACEEE Standards Analysis
• 2003 NYSERDA Energy Efficiency and Renewable
  Resource Development Potential in New York State
• (Optimal Energy/American Council for an Energy
  Efficiency Economy/Vermont Energy Investment
  Corporation/Christine T. Donovan Associates )

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5 Militia Drive, Lexington MA  02421 ph
781-860-9177 fax [phone] scoakley_at_neep.org
www.neep.org