Rationale for energy saving obligations for utilities (Energy Efficiency Resource Standards) and experiences in Denmark

Transcription

1 Rationale for energy saving obligations for utilities (Energy Efficiency Resource Standards) and experiences in Denmark Dr Milou Beerepoot Director GIZ Energy Efficiency Programme Thailand Page 1

2 Content Part I: General introduction Part II: EERS in Denmark (and comparison EU) Part III: EERS in Thailand Page 2

3 Energy efficiency: energy security Net oil and gas import dependency in selected ASEAN countries (IEA, 2013) Thailand faces highest energy security vulnerability in ASEAN region: Thai Ministry of Energy developed strong Renewable Energy and Energy Efficiency strategies: Energy Efficiency Plan : includes important role for Energy Efficiency Resource Standards (EERS) Page 3

4 What is EERS? Energy Efficiency Resource Standards (EERS): A quantitative mandatory saving target for utilities (electricity and/or natural gas, oil) that needs to be achieved through end-user energy saving programs EERS is also called Energy Saving Obligations or White Certificate Scheme or Utility Energy Efficiency Obligation Page 4

5 EERS general model Agency for implementation and oversight Defines saving target Defines eligible measures and calculation methods Certifies achieved energy savings Monitors and evaluates the EERS Certified energy savings Certified energy savings Bilateral Utility 1 trading of certificates? Utility 2 Certified energy savings Implementation of measures Implementation of measures Financial incentives ESCO X, Y, Z or other EE services Energy Consumption Feedback / Energy Audits Promotion Campaigns End-users Page 5

6 Why EERS? Achievement of the energy savings target is relatively certain (and can be measured with monitoring and verification scheme) Relatively low burden on public budgets (tariff levy instead) may lead to higher stability than other EE policies An EERS scheme can stimulate the development of ESCO markets or other EE service industry EERS schemes are particularly well suited for standardised EE measures in the residential sector or for SMEs Page 6

7 Why EERS? Evaluation study of European Council for an Energy Efficient Economy (ECEEE, 2012): There is clear evidence that well designed EERS, both in the EU and globally, can overcome many of the barriers to energy efficiency at an affordable price (1% to 5% additional electricity price), particularly for households and small organisations. Barriers can be overcome through: - personalised advice - technical knowledge - finance on favourable terms or through subsidies, - lowering transaction costs - providing quality assurance and confidence through a well-known brand. Page 7

8 Why EERS? Energy price Energy Efficiency obligations can deliver energy efficiency at lower cost than other programmes (example from Denmark) Page 8

9 Why utilities? Utilities are well suited for implementing EE programs due to: existing customer relations availability of energy consumption data advice infrastructure & expertise in energy efficiency Advantages for utilities (distributors): Avoided or postponed distribution network upgrades due to peak load reductions Strengthened customer relationships, improved reputation Development of new markets in the field of energy services Page 9

10 EERS worldwide Page 10

11 Part II: EERS in Denmark (and comparison in EU) Page 11

12 EERS case study: Denmark GDP - fixed prices +38% Gross Energy Consumption -4% Source: Danish Energy Agency GHG emission - standardized % Denmark successfully decoupled GDP vs. Energy Energy Efficiency and Renewable Energy contributed to decoupling Page 12

13 GWh EERS case study: Denmark Source: Ea Energy Analyses EERS target for utilities in Denmark was modest in 2005 but developed to 1.5% of annual final energy sales today Page 13

14 EERS case study: Denmark Companies Cost Saving registered Average cost per saving mill DKK GWh DKK/kWh /kwh Electricity Natural gas District heat Oil TOTAL , Overview of 2010 savings and costs shows that average cost per saving is 1.86 /kwh (compared to socio-economic electricity price in Denmark 3.65 /kwh = 0.73 DKK/kWh) Source: Ea Energy Analyses Page 14

15 EERS case study: Denmark Danish Energy Agency Electricity, district heat, natural gas, oil companies Third party / ESCO End-users Page 15

16 EERS case study: Denmark Design Option Target Obligated parties Solution chosen in Denmark Approx. 1.5% of final energy consumption annually Electricity, district heating and natural gas network distributors plus oil retailers + third party access Eligible EE measures Target sector Savings Incentives/ penalties Cost-recovery Obligation/voluntary Smaller, standardized measures, but also more complex measures Household sector, public sector, industrial sector List of deemed savings, standardized calculation methods, and engineering estimates Penalties for underperformance ( 4 /kwh) Tariff surcharge (EU: 1 to 5% additional energy bill) It is voluntary to choose to join, but if join -> then target is obligatory (typical for Danish culture) Page 16

17 EERS case study: Denmark How do utilities have to do it? Large degree of freedom Intervention method (advice, financial support, both) Target group (any) Involvement prior to initiation of EE is required Templates for documentation of involvement and achieved savings Deemed savings in addition to engineering estimates Assistance for engineering estimates Reporting via branch organisations Page 17

18 EERS case study: Denmark Organisation of roles and responsibilities Electricity companies District heat companies Oil companies 4 natural gas companies Branch organisation Branch organisation Branch organisation Costs Savings Danish Energy Regulatory Authority Danish Energy Agency Regulatory Authority is responsible for monitoring costs: Balance Justified costs? Energy Agency is responsible for monitoring savings: Balance Obligation met? Sample checks Adherence to rules? Independent evaluation Policy cost-effectiveness and adjustment needs? Page 18

19 EERS case study: Denmark Documentation requirements Deemed savings Customer identification Third party Types of intervention Initiatives Name, id, energy types, number, kwh, adjustment factor, total kwh Agreement of transfer of ownership rights 19 Page 19

20 EERS case study: Denmark Documentation requirements Engineering estimates Customer identification Third party Types of intervention Project description Current situation Future situation Assumptions and calculations Results Name, energy types, current kwh, Future kwh, annual kwh savings, adjustment factor, total kwh Agreement of transfer of ownership rights 20 Page 20

21 GWh EERS case study: Denmark GWh Obligation 2012 equiv. 1.5% energy sales By sector Net, Network, kollektiv collective solar, sol og konverteringer conversions Erhverv Private sector Offentlig Public sektor sector Husholdning Household sector By type of intervention By calculation method Not known Advice Advice/subsidy Subsidy Trade & services Industry Public Households Page 21

22 EERS case study: comparison EU countries Comparison of the EERS in EU in 2008 (ECEEE, 2010) Page 22

23 EERS case study: comparison EU countries Source: ECEEE, 2010 Costs of EERS in EU in 2008: 120 /capita 200 /capita (ex. UK), translates to 1% to 5% levy on electricity price More recently, Denmark introduced weighing factors dependent on life time of energy efficiency measure Page 23

24 EERS case study: comparison EU countries Source: ECEEE, 2010 In EU, most savings are realised in residential sector (except Denmark) Page 24

25 Part III: EERS in Thailand Page 25

26 Baseline situation Thailand and EERS Why would utilities save energy?. What is EERS? Where should savings come from? Do we need ESCO s?. Who is going to pay?. Page 26

27 Baseline situation Thailand and EERS EERS is new in the region and new to Thailand Centralised energy system model, with limited number of utilities, can have pros and cons in developing EERS Development of EERS is in need of process that creates support and commitment of key stakeholders EERS experience worldwide are useful but needs adjustment to local conditions EERS development in Thailand therefore started with a process of developing EERS design options as a basis for stakeholder discussions Page 27

28 EERS development in Thailand: design decisions EERS design decisions to be taken in Thailand : 1. Obligated parties 2. Implementation & Oversight 3. Basis for setting target 4. Financing the EERS scheme 5. Options for achieving target 6. Monitoring energy savings Page 28

29 EERS development: (interim) lessons learned Commitment of high levels in Ministry of Energy is essential Long term vision and changing utility futures can help to create support for EERS Centralized energy system model can have pro s and cons for EERS development Utilities support for EERS is pre-condition and can take time: using discussion framework as part of process Starting with a pilot to build trust and stakeholder support Page 29

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