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California Policy Perspectives
on Efficiency and Climate
Session: Taking Energy Efficiency to the Next Level
New England Restructuring Roundtable
Boston, MA October 30, 2009
Jeanne Clinton
Climate Strategies Branch Manager
California Public Utilities Commission
[email protected] or (415) 703-1159
Per Capita Electricity Sales (not including self-generation)
(kWh/person)
14,000
California w/out stds and
programs
12,000
United States
8,000
6,000
California
4,000
2,000
2
2002
2000
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
1978
1976
1974
1972
1970
1968
1966
1964
1962
0
1960
kWh/person
10,000
2
CPUC EE Goals Through 2020
Goals set for CPUC-regulated utilities from 2004 through 2020, in
accordance with best available data on energy efficiency potential.
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
•
•
3
Does not take into account potential within Publicly-Owned Utility
Service Areas
Based primarily on existing technologies and rates of adoption
California Targets for GHG Reduction
From CARB Scoping Plan, Table 2
Recommended Reduction Measures
Reductions Counted Towards
2020 Target
Percentage of
(MMTCO2E)
2020 Target
REDUCTIONS FROM CAP AND TRADE PROGRAM
34.4
19.8%
REDUCTIONS FROM COMPLEMENTARY MEASURES
112.3
64.5%
California Light-Duty Vehicle Greenhouse Gas Standards
31.7
18.2%
15
8.6%
5
2.9%
Vehicle Efficiency Measures
4.5
2.6%
Goods Movement (Electrification at Ports, Efficiency)
3.7
2.1%
Medium/Heavy Duty Vehicles (Aerodynamics, Hybridization)
1.4
0.8%
1
0.6%
Low Carbon Fuel Standard
Regional Transportation-Related GHG Targets*
High Speed Rail
Transportation Sector sub-total
Energy Efficiency (Building/appliance standards, new programs,
CHP, Solar Water Heating)
Renewable Portfolio Standard (33% by 2010)
35.8%
26.3
15.1%
21.3
12.2%
Million Solar Roofs
2.1
1.2%
Industrial Measures (sources under cap-and-trade program)
0.3
0.2%
Electric and Gas sub-sectors
REDUCTIONS FROM UNCAPPED SOURCES/SECTORS
High Global Warming Potential Gas Measures
28.7%
27.3
Sustainable Forests
Industrial Measures (sources not covered under cap and trade; Oil
and Gas, Transmission)
4
Recycling and Waste (landfill methane capture)
TOTAL REDUCTIONS COUNTED TOWARDS 2020 TARGET
174
20.2
15.7%
11.6%
5
2.9%
1.1
0.6%
1
0.6%
Aggressive EE/GHG Goals
California Air Resources Board Scoping Plan
EE Target (Nov, 2008):
–
–
–
–
–
32,000 GWh and 800 MMTherms/year
19.5 MMT CO2E in 2020
Utility programs, codes & standards, voluntary action
EE and solar water heating 15% of AB32 Plan
(Cap and trade target is 20% of Plan)
CPUC 2020 interim “Total Market Gross” EE goals (July,
2008):
– 16,000 GWh and 620 MMTherms/year
– Equal to nine or ten power plants avoided
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The California Long Term Energy
Efficiency Strategic Plan
www.CaliforniaEnergyEfficiency.com
Identifying Strategies to Fill in the
“White Space”
45,000
Economic
40,000
Cumulative GWh Savings
35,000
Huffman Bill
30,000
BBEES
25,000
savings
eligible to
be partially
claimed by
IOUs
T24+Fed Standards
Current Goals
(gross equivalent)
20,000
15,000
IOU Programs
10,000
Current Goals (net)
5,000
naturally-occurring
0
2008
7
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2010-12 IOU EE Portfolio Highlights
• 12 Uniform Statewide Programs (by sector and segment)
• Cal SPREE (Statewide Program for Residential Energy
Efficiency): 20 percent savings for up to 130,000 homes
• Commercial: Benchmarking all facilities touched by
programs
• Industrial: Continuous Energy Improvement
• Zero Net Energy New Construction: $175 million launch
• HVAC: Focus on state code compliance
• Lighting: Phases down $ for basic Compact Fluorescent
Lamps (CFLs); shifts emphasis to advanced lighting
• Communities: $260 million for 64 local governments for
own facilities and/or innovative approaches
• Statewide Marketing, Education & Outreach: coordinated
brand and implementation across 4 utilities
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Definitional Challenges for Inter-Agency
Collaboration – CAISO, CARB, CEC, CPUC
• Baselines, electric & gas load forecasts, moving
target of generation fuel mix/GHG profiles
• Defining “additional”
• Defining EE “embedded” in energy forecasts,
versus a DSM “resource”
• Modeling and assumptions for future resource
quantitative potential, costs to acquire EE
• Assigning payments; e.g. electric infrastructure,
tariffs, subsidies for EVs to replace gasoline
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Climate/EE Policy Issues Ahead for
California and the U.S.
•
Demand-side strategies not part of Cap and Trade; no
mechanism to sell GHG benefits from DSM.
– Cap and trade places limits on sources of GHGs; demand-side
strategies not directly integrated.
– GHG emission price will make more DSM “cost-effective”
– But “offsets” typically allowed outside the cap jurisdiction only
•
•
•
10
Local Governments can influence building and
transportation, but how pay for increased governance?
Allowance auctions may provide EE funds to expand
programs &/or creative allowance “retirement”
EE Institutional challenge: Need broad vision, strong
leadership, over sustained period – to overcome
”friction” of diffuse markets and action venues
DSM Financing – Needs Focus,
Attractive Terms, Exponential Growth
California needs $8 - $25 billion in financing
for EE hardware installation 2010 -2020
•
Statewide Utility On-bill financing (OBF):
–
–
•
For commercial and institutional customers, w/ common caps and terms
Initial $41.5 million new funds for OBF loan pool
Municipal property-based financing (or “Property-Assessed
Clean Energy Bonds “– PACE)
–
–
•
•11
The “salvation” for residential and rented/leased properties?
California links to stimulus funded retrofit programs
CPUC/State Treasurer’s office exploring collaboration to
fund EE for state facilities
Broader financing solutions report due 2010
Extra Slides
2008 Spending for Select Public Purpose RatepayerSupported DSM-type Activities (programs in $000s)
PROGRAM
TOTAL 2008
EE-electric
EE-gas
LIEE-electric
LIEE-gas
DR
CSI
NEM
SGIP-electric
SGIP-gas
Low Emission Vehicles
PIER RD&D
RPS
SUM TOTAL OF ALL PUBLIC PURPOSE SPENDING
$
$
$
$
$
$
$
$
$
$
$
$
$
622,133
136,537
91,214
66,788
141,640
323,098
76,444
14,744
67,637
87,937
112,771
1,740,943
IOU electric revenue requirement ($ millions)
IOU sales revenue requirement ($ millions)
IOU Combined electric and gas revenue requirement (millions)
IOU service area estimated population (Millions)
$
$
$
26,328
10,166
36,494
27.2
% elec OR
gas rev reqt
2.4%
1.3%
0.3%
0.7%
0.5%
1.2%
0.3%
0.1%
0.4%
% of
combined
elec & gas
rev reqt
2.08% $
$
0.43% $
$
$
$
$
0.25% $
$
0.19% $
0.24% $
$
4.77% $
2008 Data from Regulated California Electric and Gas Utility Ratepayer Costs, CPUC Report, February 2009
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Per capita
22.87
5.02
3.35
2.46
5.21
11.88
2.81
0.54
2.49
3.23
4.15
64.01
2010 Authorized Ratepayer Spending
for Energy Efficiency
PROGRAM
2010 expected budgets
EE-electric
EE-gas
LIEE-electric
LIEE-gas
DR
CSI
$1.03 billion
33% higher than 2008
$310.7 million
nearly 50% higher than 2008
14
lower than 2008
% of
combined
2008 elec &
gas rev reqt
2.8%
0.9%
CA’s 2010-2012 Investor-Owned
Utility EE Portfolio Metrics
•
Savings Impacts Anticipated:
–
–
–
–
•
•
•
•
•
15
6,965 GWH (3rd yr cum)
1,537 MW
150.3 MM Therms
3.07 million tons of CO2e emissions avoided (3rd yr cum)
Equivalent of 3 large power plants
$3.1 billion cost-effective efficiency portfolios
$ 41 per capita per year (combined gas and electric)
Supports 15,000 - 18,000 new jobs
Performance metrics to track market transformation and
programmatic progress, beyond energy savings
EE Market-Place Challenges
• Market strategies need to extend beyond utility programs,
leverage private resources, capture economic value
• Promote the business potential, capital investment
opportunities
• Mobilize bold action and create a "movement" for EE and
other demand-side actions, behavior, investment:
– Achieve deeper action – 20%, 40 %, 70% efficiency gains
– Pull consumer and business demand; call on comparative benchmarks
– Marketing to reflect understanding of market segments, motivations,...
• Expand knowledgeable and trained providers who can
successfully sell and deliver results
• Innovate effective financing mechanisms – long amortization
terms and transferable to successive owners/occupants
(OBF, PACE, ...)
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