Codes & Standards White Paper: Methods for Estimating Savings

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1 Codes & Standards White Paper: Methods for Estimating Savings Douglas Mahone, Nick Hall, Ken Keating, Lori Megdal, Rick Ridge on behalf of Marian Brown, SCE 1

2 2 Program History Statewide evolved from separate efforts - continue different emphases Since 1998 significant $$ focused on upgrades to Title 24 CASE Initiatives - code change proposals Market / product research Technical / cost analysis Advocacy with stakeholders & CEC

3 3 Examples of CASE Initiatives Time Dependent Valuation Residential Standards Hardwired lighting (CFLs( CFLs) Multifamily water heating HVAC & windows in existing bldgs. Nonresidential Standards Skylighting and photocontrols for big box Automatic bi-level controls Modular Classrooms Appliance Standards Air conditioners, TXVs,, acceptance testing Dry-Type transformers

4 4 Program History (continued) 2001 Cycle - AB 970 Emergency Updates Both building (Title 24) and appliance (Title 20) standards Proposals under development Adoption effort throughout 2000 Adopted January 2001 Effective June Cycle - Title 24 Updates Development effort throughout Adopted January 2004 Effective October /2007 Appliance Standards Updates Updates planned every three years 2008 just starting

5 5 Claiming Savings for C&S Up to now: Information-Only Program CPUC Energy Savings Goals (D ) 060) Finding #27: aggressively pursue programs that support new building and appliance standards Finding #14: Only actual installations should be counted towards the savings goals. savings reported for PY2006 will reflect measures actually installed during calendar year 2006, regardless of whether the commitments to install those measures were made in PY2006 or in prior program year(s). (emphasis added)

6 6 Counting Savings Relationship to IOU savings goals KEMA/Xenergy studies assumed C&S savings since 2003 as part of the technical potential CEC staff (Messenger) did not adjust IOU savings goals for future C&S enhancements C&S savings since 2003 should be counted toward meeting the goal else programs are penalized by new standards Need reasonable method for attributing savings

7 7 Estimates of C&S Savings Single year savings estimate, C&S adopted since 2001 Cycle/Sector Electric Energy GWh Electricity Demand MW Gas Energy Therms Total Savings ,700,000 C&S Program Savings ,090,000 Statewide Goals (for 2006) 2,032 1,199 72,000,000

8 8 Savings Trends (Appliances) 6000 CASE Annual Electricity Savings Rate (GWh/yr) Digital Television Adaptors DVD Players Televisions Compact Audio Players External Power Supplies - Tier External Power Supplies - Tier 2 Commercial Hot Food Holding Cabinets Under Cabinet Fluorescent Luminaires/Ballasts Cumulative Electricity Savings (GWh) Luminaires For Metal Halide Lamps - Vertical Traffic Signal Modules For Pedestrian Control State-Regulated General Service Incandescent Lamps - Tier 1 Electric Dishwasher Pre-Rinse Spray Valves Portable Electric Spas Residential Pool Pumps, High Efficiency - Tier 1 Residential Pool Pumps, Two-speed - Tier 2 Large Packaged Air-Source Commercial Air Conditioners - Tier 1 Large Packaged Air-Source Commercial Air Conditioners - Tier 2 Water Dispensers (heats and cools water) Automatic Commercial Ice Makers Refrigerated Bottled And Canned Beverage Vending Machines Walk-In Refrigerators Walk-In Freezers Commercial Refrigerators And Freezers Without Doors Commercial Freezers With Transparent Doors Commercial Freezers With Opaque Doors Commercial Refrigerators With Transparent Doors Commercial Refrigerators With Opaque Doors

9 9 Energy Savings Estimation Engineering Estimates of Savings Market Size and Measure Penetration Differences in Standards Implementation Mandatory measures Prescriptive measures (with trade-offs) Optional credits Appliance standards User Behavior Average Building vs. Prototype

10 10 Methods for Attribution How much of the savings do we credit to C&S Program? Quick & dirty negotiate/agree to % credit HMG approach consensus of experts ADM approach credit for individual CASEs Do we distinguish between measures? For attribution, yes; otherwise, use whole bldg. Book savings in the year they come online

11 11 Penetration Over Time Natural Market Penetration vs. Code - Simplistic version) Effect of Code

12 12 Lifetime Savings Estimation Net Effects Lifetime period of time savings accrued that would not have accrued Factors: Type of technology/practice Expected lifetime Persistence of savings Naturally occurring adoption rate (numbers & time) Level of code compliance

13 13 Deriving Lifetime Estimates Estimate magnitude of savings Establish the time period Accumulate savings over time Adjustments Actual construction rates (vs. predicted) Normal market adoption rates Normal code change rates Code compliance rates Account for cost of energy

14 14 Expected Savings Path MWh 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 Annual energy savings estimates (MWh) Actual Construction True-ups Naturally Occurring Market Change Normally Occurring Code Up-Dates Enforcement Adjustments Total Adjustments Net Program Induced Effects 500, Year of impact after adoption

15 15 Savings Cost vs. Time $0.06 Cost of Saved Energy From 2005 C&S Program Induced Changes $0.05 $0.04 $0.03 $0.02 $0.01 $

16 Portfolio Planner Recommendations 16 Treat C&S as integral to portfolio Accrue savings beginning 2006 Base C&S savings on 2005 standards Competition with traditional programs false competition For prime time measures, C&S most cost effective C&S can t t capture many kinds of savings Need special savings calcs for C&S

17 17 CPUC Recommendations Technical potential assumes need for C&S Count C&S savings toward goals Consider precision in savings estimates how much is needed? Consider explicit treatment of C&S in load forecasts and procurement portfolio C&S will produce more savings than program will claim

18 18 Lost Opportunities Policy: Capture them Need mechanism to value them in planning Recognize as a reduced transaction cost High cost of winning customer participation Cheaper to do all measures while there Reduced cost improves cost effectiveness