Efficiency Potential and Market Analysis

An energy efficiency potential study is a tool to help states advance smart energy policies and programs by providing critical data resources to inform decision makers.  These studies have been conducted by states and utilities since the 1980s to quantify the size of the energy efficiency resources in their territories and to identify major opportunities for energy savings. A study could support a number of state or utility needs for designing efficiency policies and programs, such as setting energy savings goals, incorporating energy efficiency into the integrated resource planning (IRP) process, or determining funding levels for efficiency programs and policies. 

In the traditional approach of energy efficiency potential studies, there are three broad categories of efficiency potential: technical, an ideal scenario which sums all energy efficiency measures that are feasible given technology limitations; economic, the fraction of the technical potential that is cost-effective; and achievable, or fraction of the economic potential that is attainable given actual program infrastructure and both societal and market limitations.

While energy efficiency potential analyses have been prepared for decades, there has been some inconsistency in how the studies have been conducted and how terms are defined.  See Eldridge et al. 2008 for a discussion of energy efficiency potential studies. ACEEE has conducted several energy efficiency potential analyses over the past three decades and recently began to take a somewhat alternative approach.   Our State Clean Energy Resource Project produces a series of state efficiency studies and in addition to estimating the overall potential for energy efficiency in a state, the studies also focus on specific policy opportunities for states to pursue and engage stakeholders.