In a wider push to increase energy efficiency, 19 states are incorporating health and environmental benefits into the cost effectiveness testing of utility-run efficiency programmes.
Quantifying these advantages is a step towards increased funding and broader programme offerings. ACEEE’s new topic brief profiles these states and the unique ways they are accounting for the diverse benefits of efficiency.
States vary in how they calculate these benefits, some of which result from reducing energy use and air pollutants.
We look at four types of benefits: avoided cost of compliance with environmental regulations, improved air quality and other benefits to the environment, public health gains, and improved health of programme participants.
Most of the 19 states monetise the value of at least one of these benefits based on jurisdiction-specific studies or estimates from other utilities or areas. Other states use substitute methods.
Many states incorporate these benefits using a traditional cost-effectiveness test such as the Total Resource Cost Test or the Societal Cost Test, as described in the California Standard Practice Manual.
Other states have begun using the National Standard Practice Manual (NSPM), which describes a new, policy-focused approach to cost-effectiveness analysis. The NSPM allows states to incorporate their own policy objectives into testing, including efficiency’s health and environmental benefits.
Click here for the full blog post and to learn more about increasing the impact of these strategies...