CONTENTS. Welcome 3 History 4 Mission/Challenges 5 Approach 6-7 e21 Initiative 8-9 Policy Energy Fit Homes Collaboration 14 Budget 15

Transcription

1

2 CONTENTS Welcome 3 History 4 Mission/Challenges 5 Approach 6-7 e21 Initiative 8-9 Policy Energy Fit Homes Collaboration 14 Budget 15

3 We are in the midst of an energy revolution. The transition away from fossil fuels to a clean energy economy is one of the great challenges of our time, and the imperative for change grows daily as the effects of climate change become clearer and manifest in new and unpredictable ways. Without drastic changes in how we produce and use energy, our climate and our economy will face unprecedented challenges. To mitigate environmental impacts and increase our economic competitiveness, we need to find ways to produce and use energy more efficiently. At the Center for Energy and Environment (CEE), we discover and deploy effective solutions for a healthy, low-carbon economy through technical research, innovative program delivery, clean energy financing, and pragmatic policies for cost-effective emission reductions. Our earliest work was motivated by an energy crisis, urban blight, and extreme air pollution. As the reality of climate change has become clearer, however, it has rapidly become our organizing principle behind the value of working locally. We can t ignore how we use energy, especially in our own back yard. Business as usual is not an option. The only sustainable way forward is to foster an energy-efficient economy that continuously and cost-effectively reduces fossil fuel consumption and the dangerous emissions associated with its use. And although we love data, we love results even more so while others talk about the need for action, we ve made it our business to take action. Balancing planning with doing, we are strengthened by CEE s time-tested expertise developing creative and strategic new approaches for lasting impact. Almost 40 years ago, CEE was formed as an office of the City of Minneapolis to craft practical solutions for energy inefficiency. Since then, we have expanded our work regionally, designing and implementing programs to address every area of our energy economy, from production to industrial, commercial, and residential use. Since 1979, CEE s programs have saved an estimated 2,000 gigawatt-hours of electricity and prevented about 1.8 million tons of carbon dioxide from reaching the atmosphere, all while making energy more affordable and our economy more productive. We collaborate with utilities, local governments, nonprofits, and businesses to deliver actionable research and innovative programs, providing local models for national audiences to reduce energy waste and harmful emissions. And our policy approach works hand in hand with our research and programs, further extending our reach. Ground we started laying in the 1970s helped create Minnesota s context for nation-leading energy policies that have saved 99,000 gigawatt-hours of electricity in the past 20 years, equal to the annual production from more than 10 Prairie Island nuclear plants. In recent years, CEE s strong relationships with energy utilities, nonprofits, and the business community helped forge a nation-leading collaboration for a statewide energy economy that emphasizes environmental goals over higher energy sales. The e21 Initiative, co-coordinated by CEE, unites utilities, regulators, consumer advocates, and other stakeholders behind a new framework for environmental progress that also strengthens our state s financial viability and utilities reliability. Utilities have been engaged by design from the start, and are actively participating in their industry s transformation, rather than resisting it. On its current track, e21 holds singular potential to help Minnesota meets its statutory goal to reduce harmful emissions by 80% by 2050, providing a model for other states looking to transform their own energy systems for the 21st century. CEE has decades of experience developing and deploying solutions to address the environmental impacts of energy production and use. Every day we work on the front lines of our energy economy to reduce greenhouse gas emissions, slow the march of climate change, and secure a healthy, low-carbon economy for future generations. Sheldon Strom Mike Bull President and Founder Director of Policy and Communications

4 HISTORY The Center for Energy and Environment began as the Energy Office of Minneapolis in The Energy Office was a pioneer in energy efficiency, performing Minnesota s first blower door tests and infrared scans, creating the Energy Bank financing program, and serving thousands of Minneapolis residents through Neighborhood Energy Workshops and Operation Insulation. As part of an early 1980s utility partnership, the office ran a program to field-test specific energy conservation measures in multifamily buildings, a national first for rental properties. In 1989, the Energy Office dissolved and the organization incorporated as an independent 501(c)(3) nonprofit, originally named the Center for Energy and the Urban Environment. Over the years, CEE has developed programs that have served more than 50,000 residential customers and 10,000 businesses, including: 1996: Minneapolis Neighborhood Revitalization Program, for which CEE produced over $27 million in financing for 40 neighborhoods; 2000: One-Stop Efficiency Shop, which CEE developed to help Minnesota business owners retrofit their lighting by providing knowledge, expertise, and resources. By 2014, the program had reduced Minnesota s electricity demand by 114 megawatts; 2006: Minnesota Energy Challenge, which CEE created to supply practical actions and education to help Minnesotans reduce their energy use. There are currently more than 30,000 Minnesotans Center for Energy and Environment is Minnesota s leading nonprofit when it comes to energy efficiency...it is really because of CEE that Minnesota is in the leadership position we are nationally on energy efficiency. pledging to reduce over $13,000,000 in energy costs; 2009: Public Building Enhanced Energy Efficiency Program for the State of Minnesota, which CEE developed to help decrease energy consumption spread across over 40 million square feet in 905 public buildings at 70 individual sites; and 2013: Energy Intelligence Program, which incorporated key lessons from CEE s decades of program design work to reach a new market of small industrial companies and help lay the groundwork for the smart grid revolution. In addition, CEE has become the top home improvement lender for the Minnesota Housing Finance Agency. CEE now lends more than $10 million annually resulting in more than 1,100 home improvement loans financed throughout the Twin Cities metropolitan area. To date, CEE has originated more than 20,000 loans totaling more than $150 million for community rehabilitation. Over the years, CEE has received numerous awards for its innovation and excellence, including the Minnesota Governor s Award for Excellence (2003); Minnesota Housing Financing Agency Outstanding Lender Award (2004, 2005); Minnesota USGBC Leadership in Sustainability Award (2011); Finance & Commerce Progress Minnesota Award (2012); and ACEEE Exemplary Energy Efficiency Program Award (2013). CEE continues to work with businesses, utilities, government agencies, nonprofits, and communities to design and implement practical and innovative energy-efficiency programs that reduce emissions and protect the environment in Minnesota and beyond. - Bill Grant, Commissioner of Energy and Telecommunications, Minnesota Department of Commerce 4

5 MISSION The Center for Energy and Environment is a nonprofit organization that promotes energy efficiency to strengthen the economy while improving the environment. CEE conducts research and develops programs so that: Businesses operate more efficiently and profitably; Government agencies and nonprofits spend less on facilities and functions; Utilities achieve their energy-efficiency goals at least-cost; and Households save money and improve comfort. CHALLENGES & SOLUTIONS The way we produce and use energy in the United States is not sustainable. Our need for an energy transformation is critical. There is now more carbon in the atmosphere (400 parts per million) than at any time in human history, caused primarily by the burning of fossil fuels. Power plants are the leading sources of carbon emissions and other pollutants, and inefficiencies in industrial processes and residential and commercial buildings only exacerbate the problem. In the U.S., electricity generation is responsible for 38% of all greenhouse gas emissions, 63% of sulfur dioxide emissions, and 21% of nitrous oxide emissions. This pollution is contributing to climate change; damaging our air, water, and land; contributing to thousands of deaths and serious health problems every year; and hurting our economy. Eliminating wasted energy through energy efficiencies would reduce pollution, limit climate change, improve public health, reduce energy bills, make businesses more competitive, create jobs, and strengthen our economy. Smart policies and legislation can improve how energy is produced and used, to become more clean and efficient. And the impact would be incredible. The United States now uses 56% less energy than it would without the energy-efficient technologies and policies it has in place. Further investments in energy efficiency across the largest sectors of the American economy could remove up to 1.1 gigatons of greenhouse gas emissions from the atmosphere annually equal to taking all U.S. cars and trucks of the road for one year while creating hundreds of thousands of jobs. In Minnesota, where CEE continues to play a foundational role in the development of some of the country s most progressive energy-efficiency policies, the benefits have been striking. Over the past 20 years: Conservation programs have saved approximately 99,000 gigawatt-hours of electricity, equal to the annual production from more than 10 nuclear power plants. Efficiency programs have prevented more than 97 million tons of carbon dioxide and other emissions from entering the atmosphere. Energy-efficiency jobs have increased more than 80%, to nearly 10,000 workers at 445 businesses statewide. Annual savings from energy-efficiency projects has grown to equal the potential production of 125,000 homes with rooftop solar or 365 wind turbines. Our economy, our environment, and our health depend on our ability to produce and use energy more efficiently. 5

6 CEE S APPROACH CEE s nonprofit mission centers on advancing costeffective energy efficiency in the public interest. CEE supports this pursuit through six core strategies: RESEARCH The quest for progress through clear understanding and data-driven application of good ideas is fundamental to CEE s core identity. Research informs all our programs and strategies. We field-test systems and equipment in buildings, from homes to high-rise office towers, generating objective data on measured energy savings. We conduct technology and market assessments to identify tomorrow s energy strategies. We also conduct indoor air quality research, a vital aspect of building performance that interacts with energy measures. We disseminate findings to energy practitioners, utilities, building owners, and policymakers. Our nationally recognized research staff has published more than 100 technical papers on building and mechanical system performance. PROGRAMS CEE assists electric and gas utilities in the design and implementation of innovative, cost-effective efficiency programs for residential, multifamily, and commercial customers. We adopt best practices to expand upon the state of the art in program design. CEE s program design is firmly rooted in our research. The energy-saving measures implemented in our programs are selected through a rigorous technical analysis performed by our research staff. Our program experts also design cost-effective marketing strategies and incentives to achieve energy savings through direct action by individuals, businesses, and communities. Using the latest behavioral research and a one-stop approach, CEE s programs overcome barriers that many homeowners and business owners face when considering energy improvements. Programs include the One-Stop Efficiency Shop, a full-service lighting rebate program available to small businesses in Xcel Energy s Minnesota service territory with an electric demand of 400 KW or less; and Home Energy Squad Enhanced, a onestop, full-service residential energy program that combines the direct installation of energy-saving materials with a full assessment of energy-saving opportunities in the home. Both programs have been recognized as Exemplary Energy Efficiency Programs by the American Council for an Energy- Efficient Economy. 6

7 ENGINEERING SERVICES Independent of our portfolio of successful utility partnership programs, CEE contracts directly with business clients to provide technical assistance for commercial and industrial buildings, focusing on practical solutions for complex energy issues. Our exceptional staff of PhDs and research engineers is nationally recognized for their expertise in energyrelated technologies and applications. CEE s engineering projects cover a wide variety of facilities including manufacturing, healthcare, correctional, office, K-12 schools, college campuses, ice arenas, parking ramps, theaters, and more. Projects encompass a broad range of systems and equipment, including HVAC equipment, building automation systems, building envelopes, lighting, and alternative and renewable energy equipment. To support knowledge sharing, we maintain an online resource center of technical documents and data-driven tools, host events and webinars, and use innovative communication technologies to share insights and information with energy professionals. We also use design to synthesize information, demonstrate research procedures and results, and identify trends. Specific to education, the Minnesota Energy Challenge is our free, online action guide to help Minnesotans reduce energy waste at home; our TOLBY (Turn Off Lights Behind You) program educates Minnesota youth about energy efficiency through school visits. LENDING CENTER Since 1989, CEE has worked cooperatively with various agencies throughout Minnesota to develop and fund innovative financing products that complement offerings from utilities, government agencies, private institutions, and foundations. Annually, we finance more than $15 million in energy-efficiency and rehabilitation improvements. To date, we have originated more than 22,000 loans and grants totaling over $170 million. Our financing products include revolving loan pools, interest rate buy-downs, and deferred and forgivable loans and grants. CEE is a nontraditional lender that offers competitive terms, technical assistance, and a wide array of flexible financing options for Minnesota businesses, nonprofits, homeowners, and multifamily property owners for rehabilitation and energy-efficiency projects. ENGAGEMENT & EDUCATION POLICY CEE strives for collaborative progress supported by data and research and guided by a public-interest ethic. An integral part of our nonprofit mission is to advance public policies that strengthen long-term economic and environmental interests. We focus on saving energy, which remains the lowest cost and lowest impact way to meet future energy needs and reduce harmful emissions. The Innovation Exchange is CEE s resource for practitioners and experts to access and share best practices, evaluate novel ideas, and discover the next generation of energy solutions. 7

8 PROGRAM SPOTLIGHT e21 INITIATIVE Minnesota s e21 Initiative is a groundbreaking collaboration of utility companies with public and private institutions to develop a 21st century energy system that reduces greenhouse gas emissions from utilities. BACKGROUND Emissions from utilities are one of the primary drivers of climate change. In the U.S., utilities account for 31 percent of the total carbon emitted into the atmosphere, as well as significant amounts of other greenhouse gases like methane and nitrous oxide. Regulation of utilities is one of the most effective tools we have to bring these emissions down. Yet our models for utility regulation which date back to the turn of the 20th century, just 20 years after Thomas Edison established the first centralized electric utility in New York are increasingly outmoded and ineffective, rewarding companies for increased production rather than for achieving critical public policy goals. We can do better. e21 INITIATIVE The e21 Initiative (co-coordinated with Great Plains Institute) brings together key constituencies including utilities, consumer groups, businesses, environmental organizations, academic institutions, and government agencies to reform utility regulation so Minnesota can stay a leader in shaping an energy system for the 21st century. e21 participants employ two fundamental strategies to align utility interests with public policy goals and modernize utility regulation: 1. Give consumers more options in how and where their energy is produced and how and when they use it. This replaces the current one-size-fits-all utility business model that provides customers with few options and produces grid electricity largely from coal, natural gas, or nuclear power at large central stations. 8

9 2. Change utility regulation to reward utilities for achieving agreed-upon performance outcomes that the public and customers want, such as energy efficiency, reliability, affordability, emissions reductions, and predictable rates. This replaces a current regulatory system that primarily rewards the sale of electricity and the building of large, capitalintensive power plants and other facilities. e21 presents Minnesota with an opportunity to lead the nation in demonstrating how a new customercentric, performance-based regulatory approach and utility business model can enable both economically viable utilities and the achievement of public policy goals. The result will be an electric system that is cleaner, more flexible, more secure, more resilient against attack and natural disaster, and able to empower customers to manage and reduce their energy costs while maintaining the system s high level of reliability. It will also bring about an electric system that is more distributed, flexible, intelligent, efficient, real-time controlled, and open to more participants. e 21 mncee.org/e21 Minnesota Initiative Technology, market, and policy forces are inexorably transforming the energy economy and technology landscape, impacting utilities and their customers in profound ways. 9

10 PROGRAM SPOTLIGHT POLICY 10 CEE works to advance clean energy policy at the local, state, and national levels. Our DNA drives us to discover and deploy the most effective solutions for a healthy, low-carbon economy. We seek out highimpact, pragmatic solutions to accelerate near-term implementation, guided by long-term environmental and economic goals. Like all areas of CEE s work, we strive for collaborative progress supported by data and research and guided by a public-interest ethic. MN STATE EFFICIENCY POLICY CEE s core policy expertise complements Minnesota s approach to utility energy-efficiency activities. CEE has been the leading voice for energy efficiency in Minnesota, guiding the state s rise to its current position as a national energy-efficiency leader. Beginning with designing and implementing early demand-side management pilot projects in the 1980s and continuing through the updated efficiency standards of Minnesota s 2007 Next Generation Energy Act, CEE continues to be an innovative and pragmatic force for energy efficiency and other cost-effective clean energy policies. LOCAL GOVERNMENT POLICY CEE s beginnings as the Minneapolis Energy Office rooted our work in the clean energy efforts of local governments. From creating local energy plans, to designing program and financing tools, to measuring how land use and building stock patterns can lessen energy impacts, we regularly work with local governments on city-specific program implementation. We provide policy and program expertise based on city-specific needs, and even participate in neighborhood-scale initiatives. In , we worked with the City of Minneapolis, Xcel Energy, and CenterPoint Energy to recommend and help establish the first city-utility partnership in the nation, with each party committed to meeting shared climate action goals. The Minneapolis Clean Energy Partnership is a significant innovation in how local governments can interact with the utilities that serve them to address local clean-energy objectives. PERFORMANCE STANDARDS AND ENERGY DISCLOSURE CEE provides technical training and assistance for the Midwest s first commercial building benchmarking statute in the city of Minneapolis. CEE s scientific expertise specific to buildings lends itself to numerous applications such as commercial building benchmarking, commercial and residential certification, and state appliance standards. CEE has a longstanding participation in national technology standards processes, and staff members have chaired numerous technical committees through ASHRAE, a global membership group focused on sustainable technology for the built environment. CEE continues to help forge the next generation of customer-side technologies through policy levers and standards. REGULATORY REFORM At the forefront of energy efficiency and customer-sited renewables is the question of how to create a new electric utility business model that encourages rather than conflicts with industry transformations that are currently under way. CEE created and co-directs the nation-leading e21 Initiative to develop such a model. In addition, we actively participate in numerous policy-related stakeholder efforts to tackle such issues for Minnesota, including revenue decoupling, CEE was a great partner when we passed nation-leading energy reforms like the Next Generation Energy Act and the Sustainable Buildings 2030 Energy Standards. These forward-looking reforms are creating a more sustainable future by increasing renewable energy usage and requiring publicly funded buildings to be more efficient. - Yvonne Prettner Solon Former Lt. Governor of Minnesota

11 innovative utility rate design and service offerings, and utility performance incentive structures to align utility interests with public interests. CLIMATE CHANGE AND CLEAN ENERGY CEE staff regularly apply their expansive knowledge of power system and utility operations to issues affecting large-scale decarbonization of the electricity sector. This includes Minnesota s large-scale renewable energy adoption, emission reductions in power sector operations, and nation-leading energy efficiency innovations. In addition, CEE hosts the Minnesota Clean Energy Roundtable, a regular policy meeting of key Minnesota clean energy advocates. renewable generation can defer capital investments in upgrading electric utility transmission and distribution (T&D) assets and avoid environmental emissions like greenhouse gases, mercury, and fine particulates. CEE will work with field leaders to develop a grid modernization strategy to reduce the environmental impact of the electric utility sector by determining the potential for energy efficiency, solar, and other distributed energy resources to be applied in a very focused and localized way to replace planned T&D upgrades. mncee.org/policy POLICY PRIORITIES Energy efficiency in the Clean Power Plan. As stakeholders come together with environmental and utility regulators to craft a state plan for compliance with the U.S. EPA Clean Power Plan, CEE will serve as the region s leading voice for energy efficiency as the foundation of a least-cost, best-value compliance plan. Energy Technology Business Accelerator. CEE is developing a new Energy Technology Business Accelerator, which will identify and evaluate emerging high-tech energy products and establish costeffectiveness, efficiency gains, and environmental benefits that can be relied upon by utilities, policymakers, and energy businesses in utility planning and program development. The Accelerator will continue to promote our vision for cost-effective energy efficiency, while creating new market opportunities for utilities and Minnesota businesses. Grid modernization. Strategic, geo-targeted, and distributed clean-energy investments in efforts such as energy efficiency, load control, and distributed 11

12 PROGRAM SPOTLIGHT ENERGY FIT HOMES SM Energy Fit Homes is a certificate program for existing homes that harnesses market forces to encourage home improvements for energy efficiency. Over time, the program has the potential to transform the market for energy efficiency and result in dramatic reductions in energy use in older homes, leading to significant reductions in greenhouse gas emissions in Minnesota and beyond. BACKGROUND In Minnesota, 400,000 homes need energyefficiency improvements. Though there are costeffective ways to retrofit these homes for energy efficiency including modifications to heating systems, windows, insulation, and lighting homeowners and homebuyers have little incentive to undertake such improvements when the costs are not clearly reflected in home values. At the time of sale, an existing home s efficiency level is essentially invisible. Homeowners planning to sell have little incentive to invest in efficiency without evidence that their investment will be recaptured. And homebuyers have only limited information on the energy efficiency of homes for sale or the retrofits they need. As a result, low energy efficiency in hundreds of thousands of homes is not being addressed a clear market failure. ENERGY FIT HOMES Center for Energy and Environment created Energy Fit Homes to help incorporate a home s efficiency level into its sale price, incentivizing homeowners to complete improvements and recapture the costs at sale time. Energy Fit Homes is the first energy certification program in Minnesota to focus exclusively on existing homes (rather than new construction), where the greatest opportunities lie 12

13 LOCAL SOLUTIONS FOR NATIONAL PROBLEMS to improve energy efficiency. To receive certification, homes must meet defined standards for energy efficiency that are easily measurable and verifiable. Because certification can be achieved by any homeowners making cost-effective improvements to their homes, the program is scalable by design, with increased participation by individual homeowners resulting in increased economic and ecological benefits. As Energy Fit Homes gains market acceptance and begins to add tangible value at the time of sale to certified homes, more homeowners will undertake energy-efficiency retrofits to take advantage of the added value provided by the program. Widespread adoption of the Energy Fit Homes certification will ensure that the value of energy efficiency is captured in home prices, resulting in an increase in residential energy-efficiency retrofits and a market transformation for energy efficiency in existing homes. Using the Twin Cities program as a model, communities across Minnesota and across the country can begin to increase the energy efficiency of their existing housing stock, resulting in largescale reductions in energy use and greenhouse gas emissions. mnenergyfit.org CEE develops model community-based programs to reduce energy waste that are applicable to communities across the country. In Minnesota, more than 12,000 businesses and 65,000 families have used CEE programs to reduce their environmental impact, lower their energy bills, create jobs, and strengthen the local economy. Our programs produce positive realworld outcomes, and we are committed to providing expert technical resources to underserved communities and delivering unique cost-effective programs. CEE s innovative program development model draws on our comprehensive expertise in engineering and technology, stakeholder engagement, policy development, and on-the-ground program implementation to ensure that solutions for communities developed and implemented here in Minnesota can be adapted to local needs and conditions in communities, states, and regions nationwide. 13

14 COLLABORATION At CEE, collaboration is at the heart of everything we do. Our program partners include: NONPROFITS American Council for an Energy Efficient Economy Center for Sustainable Building Research Clearway Minnesota Conservation Minnesota Elevate Energy Family Housing Fund Fresh Energy Gas Technology Institute Great Plains Institute Greater Minnesota Housing Fund Izaak Walton League of America Midwest Energy Efficiency Alliance Minnesota Center for Environmental Advocacy Minnesota Multi Housing Association Minnesota Technical Assistance Partners Neighborhood Energy Connection Regulatory Assistance Project Seventhwave Sierra Club Western Electricity Coordinating Council Wind on the Wires UTILITIES Austin Utilities CenterPoint Energy Dakota Electric Association Great River Energy Minnesota Energy Resources Minnesota Power Owatonna Public Utilities Rochester Public Utilities Xcel Energy BUSINESSES GOVERNMENT City of Anoka City of Bloomington City of Brooklyn Park City of Coon Rapids City of Duluth City of Edina City of Fridley City of Hopkins City of Minneapolis City of New Hope City of Richfield City of St. Louis Park Metropolitan Airports Commission Metropolitan Energy Policy Coalition Minnesota Department of Administration Minnesota Department of Corrections Minnesota Department of Energy Resources Minnesota Housing Finance Agency Minnesota State Colleges and Universities Saint Paul Port Authority U.S. Department of Energy Washington County ASSOCIATIONS Association of Energy Service Professionals Builders Association of Minnesota Minneapolis Regional Chamber of Commerce Minnesota Chamber of Commerce Minnesota Council of Nonprofits Minnesota Environmental Initiative Minnesota Municipal Utilities Association Minnesota Rural Electric Association U.S. Green Building Council Accelerated Innovations Brendle Group District Energy St. Paul E Source Electric Power Research Institute Ever-Green Energy Geronimo Energy 14

15 BUDGET INCOME Foundations Government Grants Program Service Revenue Other TOTAL INCOME FY ,000 1,275,000 9,979, ,000 $11,709,000 EXPENSES Policy Energy-Efficiency Programs Research Financing Administrative/General TOTAL EXPENSES 636,000 6,478,000 1,925, ,000 1,692,000 $11,631,000 NET INCOME $78,000 INCOME EXPENSES 15

16 212 3rd Avenue North, Suite 560 Minneapolis, MN mncee.org Phone (612) Fax (612) Center for Energy and Environment 2015 Printed on recycled paper