climate target and energy efficiency
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A new report released by Oracle Utilities and the Analysis Group discusses how energy efficiency programmes play a critical role in lowering carbon emissions.

The report looks at how energy efficiency could materially impact the ability of utilities and states to meet or miss their climate commitments.

The Utility energy efficiency programme performance from a climate change perspective report explores two types of efficiency initiatives:

  • Structural Energy Efficiency (SEE) – Programmes that combine an energy audit with access to a broader range of potential energy savings measures, such as HVAC, more efficient equipment and building shell measures, that tend to generate savings for up to 30 years.
  • Behavioral Energy Efficiency (BEE) – Programmes that aim to change customer energy usage behavior by providing critical information to consumers on energy use (especially vis a vis their neighbors or other customers with similar energy usage). These programmes typically generate savings over a relatively short time frame. 

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The report asseses an assumption that energy saving measures with longer measure lives, such as those implemented through SEE programmes, offer more climate change benefits than energy saving measures with shorter lives, such as BEE programmes.

Key study findings include;

  • BEE programmes are cheaper, delivering climate benefits at a fraction of the cost of SEE programmes.

This is evidenced by a BEE programme delivered by National Grid in Massachusetts in which the utility managed to avoid carbon emissions at about one quarter the cost of SEE programmes.

This National Grid BEE programme is also expected to deliver reductions in carbon emissions and avoided damages from climate change at about one fifth of the cost of SEE programmes. 

  • BEE programs deliver results faster, with up to five times faster than SEE programmes.

National Grid’s 2-year BEE programme mentioned above delivers an equivalent level of cumulative lifetime avoided climate change damages as the SEE programme.

  • BEE programmes are more inclusive and better at engaging low- and moderate-income (LMI) customers.
  • BEE programmes increase participation in DEE programmes, increasing the savings (and avoided GHG emissions) from those projects.

Recommendations by the report authors to ensure energy efficiency projects help utilities to achieve their climate change goals include:

  • Regulators and utilities need to work together to integrate GHG-focused metrics for evaluating the design, budgeting and performance of utility EE programmes.
  • Value the timing of avoided GHG emissions by maintaining annual energy savings targets. Emphasising lifetime savings targets leads to designing energy efficiency portfolios that fail to maximise near term GHG reductions. 
  • Design performance incentives that simultaneously maximize cost-effective savings and GHG benefits. Regulators should ensure that performance incentives do not undermine a utility’s ability to achieve GHG emissions reductions in the near term.  
  • Leverage BEE to drive SEE. The two programmes should be viewed as complementary. Designing innovative BEE and SEE programmes that intentionally reinforce one another will lead to retrofitting the residential built environment at a faster pace than if the programmes are largely uncoordinated. BEE programmes can be tailored to not only generate savings and reduce emissions but also to accelerate participation in SEE programmes.  

Read more about the report.