Energy Efficiency and Demand Side Management
Energy efficiency is a type of demand side management (DSM) program that seeks to reduce client energy use on a permanent basis through the installation of energy efficient technologies. A common example of energy efficiency is installing compact fluorescent lighting in place of incandescent lighting, obtaining the same level of illumination for significantly less energy use. Per a fact sheet published by Alliance to Save Energy, "As seen in California, a slight excess of demand for electricity over available supply can cause blackouts, massive price spikes, and economic turmoil. Small increases in demand have doubled retail natural gas prices nationwide over the last few years, resulting in plant shutdowns and home foreclosures. Demand side management programs are the cheapest, quickest, and cleanest way to respond to these challenges. Efficiency investments can save consumers money, increase consumer comfort, reduce air pollution and global warming, enhance economic competitiveness, and promote energy security".
Since
the late 1990s, utility-based demand side management programs have been on
the rise. This has also been driven by federal regulatory requirements tied
to the construction of new power plants which require utilities to consider
all demand side management alternatives to downsize new plant construction,
concerns about the rising cost of natural gas, which is the prime fuel source
for peaking power plants and the Federal Energy Policy Act 2005 requirement
of energy efficiency resource standards (EERS). An energy efficiency resource standard (EERS, also referred to as an energy efficiency performance standard) is a flexible market-based approach to deploy energy efficiency as an energy resource, to help meet client needs through energy efficiency programs rather than by constructing new supply facilities. An EERS requires utilities to achieve electricity or natural gas savings equal to a set percentage of their baseline sales or load through demand side management programs, in the same way that a renewable electricity standard (RES) requires utilities to meet a set percentage of their load from renewable resources. The two policies may be used in combination,
Since an EERS applies to energy efficiency programs, not sales, it does not limit utility sales or revenues, and the energy savings can be independently verified. Some EERS policies permit trading of efficiency credits, which allow the savings to be achieved at the lowest cost, but may give credit for existing programs as well. Several states have already adopted these standards and have mandated requirements to meet a certain percentage of future demand increases through energy efficiency and renewable resources.
CPower is in a unique position to provide turnkey solutions for demand side management programs to utilities, including:
- Custom designing combined energy efficiency and demand response programs to meet utilities' unique needs and capture synergies between the two forms of demand side management
- Encouraging the design of incentive programs which are performance based vs. rebates to clearly meet the MW targets and reduce free riders in the programs
- Developing an incentive and rebate processing and tracking system that is reliable and cost-effective to put more program dollars towards end-use rather than the management of incentives
- Creating sales and marketing collateral to promote the programs at the end-user level and with energy service providers to encourage customer participation (this will be supplemented with training programs, seminars/webinars, lunch and learns, etc.)
- Developing cost-effective measurement and evaluation plans to confirm if projected energy savings or demand reductions have been achieved by the implementation contractor
- Providing turnkey program management services to closely monitor the goals and program targets and provide a reporting mechanism to depict results against the plans
- Developing a network of engineering and implementation service contractors