Efficiency Potential & Market Analysis
One of the distinctions we often make between energy and energy efficiency is that energy acts more like a cost, and energy efficiency acts more like an investment. Like most investments, energy efficiency works by using an up front expense to generate a stream of economic benefits. Every year, our Energy Efficiency Finance Forum conference looks at ways to manage these up-front costs and how to use that stream of benefits to turn energy efficiency into a viable investment market.
There are over 25 million small enterprises that form the backbone of our national economy. They are critical to the health of local economies, generating well over half of net new private-sector jobs, according to the US Small Business Administration. Many are home-based firms with few employees, but many also occupy commercial retail space. The small business sector uses over 30% of all commercial space, more than 20 billion square feet of buildings to be heated, cooled, and lit up.
Energy efficiency is a proven and cost-effective strategy to reduce pollution and can help states comply with environmental regulations, including EPA’s Clean Power Plan. Even with the Supreme Court stay of the rule, there are many reasons to move forward with energy efficiency.
In October 2015, the Environmental Protection Agency (EPA) published its Clean Power Plan (CPP) final rule, regulating greenhouse gas emissions from existing power plants. Now that the final rule has been released, policymakers, state governments, utility and power plant owners, and other stakeholders are weighing their options to reduce carbon dioxide (CO2) from the power sector for compliance with the rule.
Even when the economy is doing well, economic growth and job creation always seem to be at the center of focus for policymakers at every level of government. So it’s only natural that when energy efficiency policies and programs are being discussed one of the questions that often comes is how will proposed initiatives affect jobs.
Energy efficiency has come a long way. From its roots in the energy crises of the 1970s, it has grown and evolved to become an integral part of our energy landscape. Examples of energy efficiency advances are ubiquitous and often invisible. We see the results of such advances in the slow growth of electricity demand in recent years. Our homes, offices, businesses, and factories continue to become more energy efficient due to innovation in technologies and applications.
Energy efficiency programs serving utility customers have grown rapidly over the past decade. While the rates of growth may have slowed in the last couple of years, most states have policies in place to achieve higher and higher energy savings from utility energy efficiency programs. In order to achieve high energy savings, program administrators can follow two key strategies: (1) get more customers to participate, and (2) get more savings from each participating customer.
It’s been a decade since we last looked at energy efficiency potential studies. Here’s what we found.
Energy efficiency technical, economic, and achievable potential studies are complex analytical tools used for quantifying the amount of energy savings a state or utility can achieve over time through a portfolio of programs. Potential studies are used regularly across the country for a variety of purposes, such as to inform program design and energy system planning, or to convey the benefits and costs of treating energy efficiency as a resource. Clearly, potential studies are invaluable in guiding future investments in energy efficiency.
As the World Cup comes to a close, fans are wondering which country will claim the championship. But the World Cup is not the only international competition coming to an exciting end next week. On July 17, ACEEE will release its 2014 International Energy Efficiency Scorecard, which will showcase winning energy efficiency policies and programs from around the globe.
After a long warm-up, energy efficiency is taking its rightful place as a starting player in the clean energy game. This spring, we’ve seen both the public and the private sector put serious resources into helping build financing solutions to help efficiency reach the scale it needs.