The World Came To Tennessee To Talk About Energy Efficiency

Guest Blog | October 15, 2013 | Energy Efficiency, Energy Policy

The world came to Tennessee to talk about energy efficiency. What are they saying about it? It’s real; there’s plenty of it; it’s cheap.

With attendees from Canada, the Netherlands, Australia and Saudi Arabia this truly was an international gathering. The American Council for an Energy-Efficient Economy recently hosted their semi-annual “Conference on Energy Efficiency as a Resource” in Nashville, Tennessee. In addition to the international attendees, there were people here from 44 states, including Alaska and Hawaii.

The overriding theme of the conference was that energy efficiency offers a real and valuable resource that can compete with conventional generation resources like coal and gas. Energy efficiency is real and measurable, there’s plenty of it out there for utilities to take advantage of, and it’s the least-cost resource available.

It’s real and dependable.
A number of presenters addressed the questions that many utility planners ask: Is this a real resource? Can I depend on it to offset supply-side generation? Many in the electric industry are more comfortable with brick and steel assets they can touch and feel than they are with demand side resources that rely on consumer behavior. Many of the states represented at this conference – notably Massachusetts and California – have been relying on energy efficiency as a resource for decades now. The evidence is in, the verdict is clear: yes, it’s real and yes, it’s dependable.

The industry term for the process by which this resource is tracked is EM&V. That stands for Evaluation, Measurement and Verification. Lauren Gage from Bonneville Power Administration gave a presentation reassuring planners that EM&V practices are robust and reliable. Jolyn Newton of the firm DNV-KEMA told about how, in the Tennessee Valley, her firm’s EM&V studies have shown that TVA’s energy efficiency programs provide a real resource that ensures a safe, reliable, efficient and sustainable energy supply.

There’s plenty of it.
The next question on many minds is how much is there? How much energy efficiency is there to tap into? One of the sessions at the ACEEE conference addressed this question directly. The session asked “how far can we go with energy efficiency as a resource?” One of the presenters, Jeff Schlegel, showed how Massachusetts has achieved an energy savings of 2% of the state’s total retail electric sales, and has plans to increase that to 2.5% and higher in the near future. Scott Johnstone, from Vermont Energy Investment Corporation, showed how his state achieved a 2% savings rate in 2007 and, with a few ups and downs, continues to climb.

How do the Tennessee Valley Authority’s programs compare? In the last four years, TVA’s energy efficiency programs have saved over 1,600 GWh and reduced capacity needs by over 900 MW. That’s the size of a good-sized power plant. And yet TVA’s energy efficiency efforts are only about 0.3% of retail sales; Vermont and Massachusetts programs are six times more successful. Natalie Mims, SACE Energy Efficiency Director, showed us how TVA and other Southeast utilities are doing with their energy efficiency efforts. The highest performer in our area, at about 0.65% of sales, is Duke Energy Carolina. Even so, they have a way to go to equal the 1% savings that many other states and utilities have achieved, much less the 2% that Vermont and others are seeing.

Southeast Utilities EE Efforts


More recent numbers from TVA indicate that they saved 0.34% of sales, rather than the 0.21% presented above. That moves TVA ahead of Georgia Power and Duke Energy Florida on the above graph. So TVA is solidly in the middle of the pack, but several other Southern utilities are barely in the game. It’s pretty clear that there is a lot of energy efficiency throughout the Southeast just waiting to be harvested.

It’s cheap.
Finally, how much does this energy efficiency resource cost, especially compared with the cost of traditional generating facilities? TVA, in their EnergyRight Solutions Highlights Report, told us that they were getting this energy efficiency at about 2 cents per kWh. Maggie Molina from ACEEE told the conference that, in a national review of utility energy efficiency programs, she found the average cost of this resource to be 2.8 cents per kWh, ranging from a low of 1.3 cents to a high of 4.5 cents. This compares to traditional nuclear, coal and gas generation costs of 6 to 14 cents per kWh.

Costs of generation options


John Wilson, SACE Research Director, gave a presentation that hinted at the future of energy efficiency programs. John’s presentation showed that the benefits of energy efficiency to the overall system go far beyond the lower cost numbers. By lowering overall system demand, energy efficiency results in universal benefit: lower fuel costs to the utility and lower system costs for all customers.

There’s more.
We’ve just skimmed the surface of the many important and informative presentations from The American Council for an Energy-Efficient Economy’s Conference on Energy Efficiency as a Resource. The full listing of presentations from the conference is available here. But just from what we’ve shared here it’s clear that energy efficiency is real, there’s plenty of it, and it’s cheap. We’ve also seen tantalizing hints that the true value of energy efficiency has not yet been fully recognized.

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