Energy Trust of Oregon, Inc.

1
Energy Trust of Oregon, Inc. Resource
Assessment Carbon Allocation Task Force April
27, 2006
2
Energy Efficiency Resource Assessment

• Purpose To quantify the projected amount and
  cost of gas and electric efficiency resources
  within the territory Energy Trust serves between
  now and 2017.
• Update 2003 study with significant amount of new
  information available (surveys, studies, program
  data).
• Results will be used to help establish policies
  and target programs for Energy Trust efficiency
  resource acquisition.
• NW Natural contracted separately for low-income
  residents and Washington territory.
• Cascade Natural Gas contracted separately to
  include their territory.

3
Resource Assessment - Scope

• Estimated technical and achievable savings
  potential and total measure cost
• Technical includes all savings available from
  possible participants without considering market
  barriers
• Achievable adjusts participation based upon
  market barriers (Power Council assumption 85
  of technical)
• Relied upon secondary data sources only
• Employed results of recent surveys/studies funded
  separately over the last few years
• Addressed both electric and gas resources
• Both fuels separately considered and summarized
• Interactive effects with other fuels quantified
  as impact to Operation Maintenance costs
• All sectors except industrial gas studied
• Results presented for 2006, 2012, and 2017
• Equipment and operational/behavioral measures
  included
• Direct application renewable resources and
  combined heat and power (CHP) addressed

4
Resource Assessment Data Sources

• Utilities PGE, PacifiCorp, and NW Natural
• Load forecasts and historical sales by sector and
  SIC code
• Survey data (e.g. Residential Appliance
  Saturation Survey (RASS)
• NW Power Council/Regional Technical Forum
• Measure characteristics, load shapes
• Energy Trust of Oregon
• Existing program data
• Measure cost and savings assumptions and
  verification
• Regional/national reports and studies
• Recent NW Energy Efficiency Alliance market
  research data from the Commercial Building Site
  Assessment
• Database for Energy Efficient Resources (DEER)
  American Council for an Energy Efficient Economy
  studies
• 2004 Census, Federal Energy Regulatory Commission
  Form 1

5
Resource Assessment Limitations

• Industrial
• Challenge of extrapolating from the number of
  individually site-specific tailored Energy Trust
  projects
• Resulted in conservative industrial saving
  projections
• Emerging technologies
• Newer technologies with less consumer interest
  and purchasing opportunities
• Example heat pump water heaters
• Next generation technologies
• Not included in study and likely to emerge
  difficult to forecast
• Example white Light Emitting Diode (LED) lamps
• Demographics
• Limited data on existing residential insulation
  levels
• New data will be available soon from the Alliance
  study

6
Summary of Study Results- Definitions

• 1. Type of efficiency potential Technical vs.
  Achievable
• 2. Cost of savings
• Total measure cost - Direct output from study
  includes cost of equipment, installation,
  operations and maintenance (Operations
  Maintenance).
• Utility system cost What it would cost for
  Energy Trust to acquire these savings includes
  incentive, program management and program
  delivery expenses.
• Societal cost Total measure cost plus the cost
  to manage and deliver the programs.
• 3. Cost effective savings
• Traditional efficiency cost effectiveness tests
  not included in the study (value of benefits
  change through time, variations of tests limit
  usefulness of output, etc.)
• Utilized a cap on the total measure cost to
  limit measure savings to those which have the
  most reasonable chance of being cost effective

7
Overall Results Gas 2017
8
Overall Results Electric 2017
9
Overall Results Electric 2017
New 25 Existing 75
New 18 Existing 82
10
Commercial by End Use Electric 2017
11
Residential by End Use Electric 2017
12
How can we use these results?

• The study provides total potential in terms of
  total measure cost
• Cost screens of 5.5 cents/kWh and 1.70/therm
  levelized approximate avoided cost of generation
  provides estimate of potential with most
  reasonable chance of being cost effective
• Limited use by itself total measure cost can
  include participant benefits of Operations
  Maintenance savings, not what Energy Trust would
  pay for savings
• Does not recognize additional value for peak load
  measures
• Other ways to looks at the results.

13
Analysis of Results Electric Savings

• Focus on Achievable Savings
• Technical potential is insufficient for program
  design

Year Utility Technical Potential All Measures (MWa) Technical Potential w/cost cap 5.5 cents/kWh (MWa) Achievable Potential All Measures (MWa) Achievable Potential w/cost cap 5.5 cents/kWh (MWa)
2012 PGE 353 270 266 202
2012 PAC 254 199 198 149
2012 Total 607 469 464 351
2017 PGE 440 334 362 276
2017 PAC 308 241 199 154
2017 Total 748 575 561 430
14
Analysis of Results Utility Cost of Savings

• Calculate a utility system levelized cost for
  each measure.
• Includes Energy Trust incentives, program
  management and delivery costs
• Results in range of savings from 351 to 433 MWa
  at an estimated utility cost of between 456M and
  579M

Year Achievable Savings w/cost Screen (MWa) Total Utility Cost First Year Cost M/aMW
2012 351 456 M 1.30
2017 433 579M 1.34
15
Utility System Levelized Cost - 2012
16
Analysis of Results Utility Cost of Savings 2012
Levelized Utility Cost Cents/kWh MWa Avg. Utility Cost cents/kWh Total Utility Cost M Utility Cost M/MWa
lt2 cents/kWh 254 0.8 cents/kWh 234 M 0.92M/MWa
2-6 cents/kWh 97 3.03 cents/kWh 221 M 2.28M/MWa
lt 6 cents/kWh 351 1.20 cents/kWh 454 M 1.30M/MWa
For perspective, in 2005, Energy Trust acquired
39 MWa at 1.3 cents/kWh levelized
17
Comparison to Energy Trust Goals

• Energy Trust 2012 stretch goal to acquire 300
  MWa savings
• 2002-2005, 96 MWa acquired
• Current estimate of 150 MWa savings 2006-2012
  achievable with projected 230M in funding for
  cumulative savings of 250MWa by 2012
• Anticipating 50 MWa short of 2012 target with
  currently forecasted funding

18
Analysis of Results Societal Cost of Savings

• Calculate a societal cost for each measure
• Includes total measure costs, program management,
  installation, etc.
• Results in same range of savings at an estimated
  societal cost of between 978M and 1,200M
• Levelized cost remains competitive

Year Achievable Savings w/cost Screen (MWa) Total Societal Cost First Year Cost M/aMW Levelized Cost cents/kWh
2012 351 978 M 2.8 2.5
2017 433 1,200 M 2.8 2.5
19
Comparison to other Resource Choices
Source of resource costs NWPCC, 5th Power Plan,
2005
20
Equivalent Avoided CO2 Emissions

• 2003 average emission rates by utility 1.867 lb
  CO2 avoided per kWh saved for PacifiCorp and
  1.123 lb/kWh for PGE
• Based on weighted average estimate of 1.42
  lb/kWh

Year Achievable Savings (MWa) Avoided CO2 output (metric tons)
2012 351 2.0 M
2017 433 2.4 M
21
Future Analysis

• Calculate estimated utility and societal costs
  for gas efficiency potential
• Quantify economic impacts of acquiring electric
  and gas savings (e.g., new business income, job
  retention and expansion, wage increases, business
  and economic development benefits)
• Calculate benefit/cost ratios for specific
  savings measures

22
Resource Assessment Next Steps

• Results serve as a general guide for long term
  planning and investment strategy
• Provides input to Energy Trust strategic planning
  and analyses
• Serves as a useful data source/tool to understand
  service territory demographics
• Comments/Questions - ?

23
Backup
24
Resource Assessment Methodology All Sectors

• Step 1 Baseline of existing gas/electric usage
  by utility, apply utility growth rates for future
  energy use estimates
• Step 2 Sort energy use by building types,
  use/square foot, etc to get typical energy use
  intensity
• Step 3 Screen potential measures for those with
  savings but limited risk
• Step 4 Collect Measure data savings, cost,
  saturation and applicability
• Step 5 Calculate savings and cost Apply
  measures to energy use population and calculate
  technical and achievable savings potential and
  total measures cost
• Step 6 Calculate measure levelized cost
  Levelize the measure installation, capital, and
  OM costs over the life of the measure.

25
Resource Assessment Methodology

• Residential
• Utility building characteristics housing type
  (SF, MF, MH) vintage, heating DHW fuel
• Average consumption by house type through
  calibration of retail sales to population data
• Commercial
• Population data converted to square footage by
  building type with EUI estimates and utility
  retail sales.
• Industrial / Agriculture
• Top down approach Sales by SIC code split into
  end use process categories
• Measures characterized as of end use load that
  can be saved

26
Residential Results Electric 2017
27
Commercial Results Electric 2017
28
Industrial Results Electric 2017