Energy Efficiency in Washington State

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Energy Efficiencyin Washington State

• Speaker Pro Tem Jeff Morris

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Examples of Energy Efficiency Policy

• Improve energy efficiency standards.
• One of the first 10 states to adopt energy
  efficiency laws on 10 appliances for in-state use
  that could conserve some 90 mWh of electricity by
  2020, enough to power over 90,000 homes.

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Examples of Energy Efficiency Policy

• ESHB 1062 2005 - Created minimum efficiency
  standards and testing procedures for 12
  categories of electrical products
• Automatic commercial ice cube machines
• Commercial clothes washers
• Commercial pre-rinse spray valves
• Commercial refrigerators and freezers
• Illuminated exit signs
• Low-voltage dry-type distribution transformers
• Metal halide lamp fixtures
• Single-voltage AC to DC power supplies
• Incandescent reflector lamps
• Torchieres
• Traffic signal modules
• Commercial space heaters

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Examples of Energy Efficiency Policy

• ESHB 1004 (2009)
• Created minimum efficiency standards and testing
  procedures for 6 categories of electrical
  products
• Wine chillers
• Hot water dispensers and mini-tank electric water
  heaters
• Bottle-type water dispensers and point-of-use
  water dispensers
• Pool heaters, pool pump motors, and portable
  electric spas
• Tub spout diverters and showerhead-tub spout
  diverters
• Commercial hot food holding cabinets.

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Examples of Energy Efficiency Policy

• Building Energy Codes
• Buildings account for approximately one third of
  energy use and carbon emissions, making them an
  important target for state energy efficiency
  policies. The time of design and construction
  represents the greatest opportunity to build
  efficiency into the total building. Builders
  typically bear the capital cost of energy
  efficiency improvements, but homeowners and
  tenants see the benefits through lower energy
  bills. Because most builders build
  speculatively, they have no feedback loop from
  the occupant to tell them to build in efficiency
  features.

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Examples of Energy Efficiency Policy

• Building Energy Codes
• Washington was one of the early adopters
  nationwide by creating their own state energy
  code in 1977. Its state energy code emerged from
  Model Conservation Standards developed in the
  Northwest region during the 1980s under the
  Northwest Power Planning Act (Act), which
  Congress passed in 1980 to require consideration
  of conservation as the preferred method to
  accommodate load growth in the Bonneville Power
  Administration Region.
• According to the ACEE 2008 Scorecard, Washington
  received full marks (8 out of 8) for its State
  Building Energy Codes, tying in first place with
  California and Oregon, creating a strong "West
  Coast" standard for state building energy codes.

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Examples of Energy Efficiency Policy

• Building Energy Codes
• E2SSB 5854 (2009)
• Requires the State Building Code Council to adopt
  energy codes for new homes and buildings that
  will gradually move towards the state achieving a
  70 percent reduction in energy use for such
  buildings by 2031. If economic, technical, or
  process factors may interfere with achieving this
  reduction target, the Council must report its
  findings to the Legislature.
• Requires CTED to develop a strategic plan for
  enhancing energy efficiency and reducing
  greenhouse gases in homes, buildings and
  neighborhoods. In doing so must identify
  barriers to achieving net zero energy use and
  ways to overcome these barriers in future updates
  to the State Energy Code.

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Washington received the highest score possible --
  5/5 -- from the ACEE for its electricity energy
  efficiency program spending in 2006. As a
  percent of total utility revenues, Washington
  ranked second overall (behind Vermont) by
  spending 2.2 percent of total utility revenues on
  electricity energy efficiency programs (not
  including weatherization program funding).

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Integrated Resource Planning key to a Regions
Future

• What is an Integrated resource plan?
• Integrated Resource Planning is an assessment of
  demand-side and supply-side resources, evaluated
  under consistent assumptions, to produce a
  cost-effective resource mix that meets expected
  short-term and long-term demand. The goals of the
  IRP are to produce a best-cost portfolio of
  supply side and demand side management
  alternatives to meet customer requirements of
  reliability under given constraints, to reduce
  costs for customers, to help diversify energy
  supply mix, and to improve modeling of demand,
  supply, and conservation.

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• ESHB 1010 (2006) requires all investor-owned and
  consumer-owned electric utilities (with more than
  25,000 customers) to develop detailed integrated
  resource plans (IRPs) that describe the mix of
  generating resources and conservation and
  efficiency resources that will meet current and
  projected needs of the utility at the lowest
  reasonable cost. These plans must contain a
  number of elements, including (1) demand
  forecasts for at least the next 10 years (2)
  assessments of commercially available
  conservation and efficiency resources (3)
  assessments of commercially available utility
  scale renewable and nonrenewable generating
  technologies (4) comparative evaluation of
  renewable and nonrenewable generating resources
  (5) integration of the demand forecasts and
  resource evaluations into a long-range assessment
  describing the mix of supply side generating
  resources and conservation and efficiency
  resources and (6) a short-term plan identifying
  the specific actions to be taken by the utility
  consistent with their long-range IRP.

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• ESHB 1010 (2006) continued. All other utilities
  in the state, including those utilities that
  receive essentially all of their power from
  Bonneville Power Administration (BPA), must file
  either an IRP or a less detailed "resource plan"
  (RP). If such a utility elects to file an RP, it
  must (1) estimate loads for the next 5 and 10
  years (2) enumerate the resources that will be
  maintained and/or acquired to serve those loads
  and (3) explain, if the resources chosen are not
  renewable resources or conservation and
  efficiency resources, why such a decision was
  made.
• http//www.cted.wa.gov/site/1140/default.aspx

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Some regional IRP examples include 
• Avista Key energy efficiency highlights (2007
  IRP)
• The Preferred Resource Strategy (PRS) includes
  350 MW of CCCT, 300 MW of wind, 35 MW of other
  Renewables, and 87 MW of conservation between
  2007 and 2017.
•  Conservation acquisition is approximately 25
  percent higher than in its 2005 IRP.
• http//www.avistautilities.com/inside/resources/ir
  p/electric/Documents/2007AvistaIRP.Pdf
• http//www.avistautilities.com/inside/resources/ir
  p/electric/Documents/2007AvistaIRPSupplemental.pdf
  

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Some regional IRP examples include 
• PSE Key energy efficiency highlights (2007 IRP)
• It is estimated that there is 702 aMW of
  technically feasible electric energy efficiency
  potential by the end of the 20-year planning
  horizon in 2027.
• Approximately 434 aMW of these resources are
  cost-effective with an average levelized per unit
  cost of five (5) cents per kWh.
• Across all sectors, 341 aMW (nearly 80 of the
  economic potential) are deemed reasonably
  achievable.
•  If fully deployed, the identified achievable
  potentials amount to nearly 10 of PSEs forecast
  load in 2027, and 30 of the projected load
  growth over the 20-year planning period.
• http//www.pse.com/energyEnvironment/energysupply/
  Pages/energyResourcePlanning.aspx

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Washingtons The Department of General
  Administration (GA) offers energy savings
  performance contracting to enable
  capital-strapped state agencies, school
  districts, and municipalities to tap various
  outside capital sources for energy upgrades.
  According to GA, since 1986 over 100 projects
  have utilized energy savings performance
  contracting to install energy efficiency
  measures, adding up to approximately 152,895,053
  in total facility improvements to date, with a
  total avoided cost since 1986 of approximately
  66,310,408.
•  http//www.ga.wa.gov/EAS/epc/espc.htm
•  http//www.ga.wa.gov/EAS/epc/convinced.htm

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Recent Legislative Activity
• SHB 1895 (2005)Authorizes aggregated energy
  audits and conservation measures for
  municipalities. Municipalities may conduct
  energy audits and implement cost-effective energy
  conservation measures among multiple government
  agencies.
• ESSB 5509 (2005) Provides that all major
  facility projects funded in the state capital
  budget, or projects financed through a financing
  contract as defined in RCW 39.94.020, must be
  designed, constructed and certified to at least
  meet the U.S. Green Building Council Leadership
  in Energy and Environmental Design (LEED) silver
  standard. This requirement applies to any
  entity, including public agencies and public
  school districts.

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Recent Legislative Activity Continued
• E2SSB 5854 (2009)Requires qualifying public
  agencies to create an energy benchmark and report
  the performance rating for each reporting public
  facility. GA must establish a state Portfolio
  Manager Master Account to provide shared
  reporting for all public facilities.
• By July 1, 2011, reporting public facilities with
  a performance rating score below 50 (average)
  must conduct a preliminary energy audit. An
  investment grade audit must be completed by July
  1, 2013 if potential cost-effective energy
  conservation measures are identified. Any
  identified cost-effective energy conservation
  measures must be implemented by July 1, 2016.  

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Recent Legislative Activity Continued
• State agencies may not enter into a new lease or
  lease renewal for a building with a performance
  rating score below 75 unless a preliminary audit
  has been conducted within the last 2 years, and
  the owner agrees to perform an investment grade
  audit and implement cost-effective energy
  conservation measures within the first 2 years of
  the lease agreement. OFM may waive these
  requirements if it determines compliance is not
  cost-effective or feasible.
•  GA must review the cost and delivery of agency
  programs to determine the viability of relocating
  from buildings leased by the state with an energy
  performance score below 50.
• http//www.cted.wa.gov/site/1140/default.aspx

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Examples of Energy Efficiency Policy

• Electric Energy Efficiency Programs
• Recent Legislative Activity Continued
• HB 1007 2009 State Energy Efficiency and
  Renewable Energy Improvement Loans. The
  Commission must make available secured loans to
  certified applicants for the purpose of providing
  financing for all or part of the project costs of
  any energy efficiency improvement or renewable
  energy improvement. The period of such loans is
  10 years for energy efficiency improvements and
  25 years for renewable energy improvements. The
  Commission must periodically issue Sustainable
  Energy Trust bonds for the purpose of financing
  the project costs of energy efficiency
  improvements and renewable energy improvements

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Utilities Assumed Relatively Modest Base-Case
Carbon Emission Price Projections
Levelized Carbon Emission Price Projections
(2010-2030)
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Global GHG abatement cost curve beyond
business-as-usual 2030 McKinsey
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Firming the Challenge!
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WECC RPS Mandates
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Renewables.WECC wide Goals vs. Current
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Legislative Issues Going Forward

• Changing RPS law in Washington
• Standard offer(feed-in tariff)
• Risk of market spikes caused by uncoordinated
  mandates
• Transmission critical for immediate mandates
• Boutique standards for RPS mandates in Region
• What Climate Change Policy? Cap and Trade or
  Carbon Tax?
• Pancaking of climate change taxes
• Credit situation not forecasted in projections.
• Lack of regional Strategy on new/clean energy

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Thank you!