The Potential to Reduce CO2 Emissions by Expanding End-Use Applications of Electricity. Executive Summary

Transcription

1 The Potential to Reduce CO2 Emissions by Expanding End-Use Applications of Electricity Executive Summary

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3 The Potential to Reduce CO 2 Emissions by Expanding End-Use Applications of Electricity Final Report, March 2009 EPRI Project Manager C.W. Gellings ELECTRIC POWER RESEARCH INSTITUTE 3420 Hillview Avenue, Palo Alto, California PO Box 10412, Palo Alto, California USA askepri@epri.com

4 DISCLAIMER OF WARRANTIES AND LIMITATION OF LIABILITIES THIS DOCUMENT WAS PREPARED BY THE ORGANIZATION(S) NAMED BELOW AS AN ACCOUNT OF WORK SPONSORED OR COSPONSORED BY THE ELECTRIC POWER RESEARCH INSTITUTE, INC. (EPRI). NEITHER EPRI, ANY MEMBER OF EPRI, ANY COSPONSOR, THE ORGANIZATION(S) BELOW, NOR ANY PERSON ACTING ON BEHALF OF ANY OF THEM: (A) MAKES ANY WARRANTY OR REPRESENTATION WHATSOEVER, EXPRESS OR IMPLIED, (I) WITH RESPECT TO THE USE OF ANY INFORMATION, APPARATUS, METHOD, PROCESS, OR SIMILAR ITEM DISCLOSED IN THIS DOCUMENT, INCLUDING MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, OR (II) THAT SUCH USE DOES NOT INFRINGE ON OR INTERFERE WITH PRIVATELY OWNED RIGHTS, INCLUDING ANY PARTY'S INTELLECTUAL PROPERTY, OR (III) THAT THIS DOCUMENT IS SUITABLE TO ANY PARTICULAR USER'S CIRCUMSTANCE; OR (B) ASSUMES RESPONSIBILITY FOR ANY DAMAGES OR OTHER LIABILITY WHATSOEVER (INCLUDING ANY CONSEQUENTIAL DAMAGES, EVEN IF EPRI OR ANY EPRI REPRESENTATIVE HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES) RESULTING FROM YOUR SELECTION OR USE OF THIS DOCUMENT OR ANY INFORMATION, APPARATUS, METHOD, PROCESS, OR SIMILAR ITEM DISCLOSED IN THIS DOCUMENT. ORGANIZATION(S) THAT PREPARED THIS DOCUMENT Global Energy Partners, LLC Electric Power Research Institute NOTE For further information about EPRI, call the EPRI Customer Assistance Center at or askepri@epri.com. Electric Power Research Institute, EPRI, and TOGETHER SHAPING THE FUTURE OF ELECTRICITY are registered service marks of the Electric Power Research Institute, Inc. Copyright 2009 Electric Power Research Institute, Inc. All rights reserved.

5 CITATIONS This report was prepared by Global Energy Partners, LLC 3569 Mt. Diablo Blvd., Suite 200 Lafayette, CA USA Project Oversight P. Hurtado Principal Investigators K. Parmenter R. Milward R. Ehrhard E. Fouche S. Yoshida Electric Power Research Institute 3420 Hillview Ave. Palo Alto, CA USA Principal Investigator S. Mullen This report describes research sponsored by the Electric Power Research Institute (EPRI). This publication is a corporate document that should be cited in the literature in the following manner: The Potential to Reduce CO 2 Emissions by Expanding End-Use Applications of Electricity, EPRI, Palo Alto, CA: iii

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7 PRODUCT DESCRIPTION Depending on the sources of electricity production, the use of electricity can be a contributing factor to net CO 2 emissions. What is less obvious is that using efficient end-use electric technologies has the potential save energy and decrease overall CO 2 emissions substantially. The two main mechanisms for saving energy and reducing CO 2 emissions with electric end-use technologies are (1) upgrading existing electric technologies, processes, and building energy systems; and (2) expanding end-use applications of electricity. Upgrading existing technologies entails replacing or retrofitting older equipment with new, innovative, highly efficient technologies; improving controls, operations, and maintenance practices; and reducing end-use energy needs by improving buildings and processes. In essence, it consists of energy efficiency and demand response measures. Expanding end-use applications of electricity involves replacing less efficient, fossil-fueled end-use technologies (existing or planned) with more efficient technologies and developing new markets for electric end-use technologies that result in overall energy, environmental, and economic benefits. This report addresses the potential for expanding end-use applications of electricity to save energy and reduce CO 2 emissions. The focus is on converting existing and anticipated residential, commercial, and industrial equipment and processes from traditional, fossil-fueled technologies to more efficient electric technologies. Two earlier Electric Power Research Institute (EPRI) studies are also of interest. The EPRI report Assessment of Achievable Potential from Energy Efficiency and Demand Response Programs in the U.S. ( ) ( ) focuses on the potential of energy efficiency and demand response to result in electricity savings in the residential, commercial, and industrial sectors. The EPRI report Environmental Assessment of Plug-In Hybrid Electric Vehicles, Volume 1: Nationwide Greenhouse Gas Emissions ( ) focuses on replacing fossil-fueled vehicles with plug-in hybrid electric vehicles. Results and Findings This research identified several efficient electric end-use technologies for replacing fossil-fueled technologies in the residential, commercial, and industrial sectors. Many of these technologies show considerable potential to save energy and reduce CO 2 emissions between 2009 and 2030 relative to the baseline forecast represented in the reference case of the Energy Information Administration s Annual Energy Outlook 2008 with Projections to Results from the analysis show that the residential sector holds the greatest technical potential for energy savings and reductions in CO 2 emissions, followed by the commercial and industrial sectors, which are roughly comparable to each other. For all three sectors combined, the cumulative technical potential for energy savings is 71.7 quadrillion BTU, and the cumulative technical potential for CO 2 reductions is 4400 million metric tons between 2009 and This equates to an annual v

8 reduction in CO 2 emissions of 320 million metric tons per year in 2030, which represents a 4.7% decrease in emissions relative to the baseline forecast. Challenges and Objectives The objective of this study was to assess the potential for expanding the application of efficient electric end-use technologies to save energy and reduce CO 2 emissions. The focus was on converting existing and anticipated fossil-fueled end-use technologies to more efficient electric end-use alternatives in the residential, commercial, and industrial sectors. One principal challenge was to identify an appropriate baseline forecast for energy use and CO 2 emissions from which to draw meaningful comparisons. The project team chose the reference case of the Energy Information Administration s Annual Energy Outlook 2008 with Projections to 2030 for the baseline forecast, which is consistent with EPRI s previous analyses and other industry studies. This baseline forecast incorporates moderate changes in the CO 2 intensity of the electricity generation mix between now and 2030; it represents a solid foundation, or somewhat stable data, for comparison. In reality, the future of energy-related CO 2 emissions is less clear because it is a function of numerous market variables and will likely be affected by greenhouse gas policies that are envisioned but have not yet been implemented. The future will probably hold a greater share of carbon-free generation technologies, including more renewable sources. It is highly unlikely that the generation mix will become more CO 2 -intensive. With a greener generation mix in the future, the potential effects of expanding end-use applications of electricity on CO 2 emissions would be greater than estimated in this study. This report can be considered a conservative estimate of the potential to reduce CO 2 emissions. Low-carbon electricity would enable even more opportunities for converting fossil-fueled technologies to efficient electric alternatives. Applications, Values, and Use This report describes the results of a comprehensive process for forecasting the potential effects of expanding end-use applications of electricity on overall energy use and CO 2 emissions relative to the baseline forecast. The analyses consider the effects of numerous electric end-use technologies across various end-use areas and multiple fuel types within the residential, commercial, and industrial sectors. Technical and realistic potential values for energy savings and CO 2 reductions are provided at the technology, region, and sector levels. EPRI Perspective EPRI is committed to the advancement of energy-efficient end-use technologies through sound research, planning, and implementation. Prompted by a growing concern over greenhouse gas emissions, this report updates and extends the work described in the 1991 EPRI report Saving Energy and Reducing CO 2 with Electricity (CU-7440). Approach The study consisted of four main tasks: (1) identifying and characterizing the electric end-use technologies to be analyzed and the fossil-fueled technologies that they would displace, (2) developing energy and CO 2 baseline forecasts, (3) estimating the potential impacts of expanding end-use applications of electricity on overall energy use and CO 2 emissions, and (4) preparing this report to summarize the results of the study in terms of the potential for energy savings and reductions in CO 2 emissions. Keywords: Carbon dioxide (CO 2 ) emissions, Electric end-use technologies, Energy efficiency, Forecasting, Fuel conversion, Potential vi

9 EXECUTIVE SUMMARY Electricity is an important energy form for use in providing comfort, convenience, essential community service, and industrial and commercial sector productivity. It is also important for generally enhancing the quality of life. Electricity is not consumed, per se, but is applied at the point of end-use in a variety of appliances and devices to yield these benefits. However, depending on the sources of electricity production, the use of electricity is generally considered a contributing factor to net carbon dioxide (CO 2 ) emissions. Compelled by a growing concern over greenhouse gas emissions, much focus is currently being placed upon the ability of supply-side options such as renewable power generation and carbon-neutral central electric generation technologies to mitigate CO 2 emissions. Exploring the greater potential for CO 2 reductions also warrants a thorough review of demand-side opportunities, including furthering the advancement and utilization of energy-efficient end-use technologies. There are two main mechanisms for saving energy and reducing CO 2 emissions with electric end-use technologies: 1) upgrading existing electric technologies, processes, and building energy systems; and 2) expanding end-use applications of electricity. Upgrading existing electric enduse technologies embodies replacing or retrofitting older equipment with new, innovative, highly-efficient technologies. It also includes improving controls, operations, and maintenance practices and reducing end-use energy needs by improving buildings and processes. In essence, this first mechanism is comprised of what are commonly referred to as energy efficiency and demand response measures. The second mechanism, expanding end-use applications of electricity, involves replacing less efficient fossil-fueled end-use technologies (existing or planned) with more efficient electric end-use technologies. It also encompasses developing new markets for electric end-use technologies that result in overall energy, environmental, and economic benefits. This current study addresses the potential for expanding end-use applications of electricity to save energy and reduce CO 2 emissions. The focus is on converting residential, commercial, and industrial equipment and processes existing or anticipated from traditional fossil-fueled enduse technologies to more efficient electric technologies. This study serves to update and extend the work done in a 1991 EPRI study entitled Saving Energy and Reducing CO 2 with Electricity (CU-7440). A key objective of the study is to inform utilities, electric system operators and planners, policymakers, and other electricity sector industry stakeholders in their efforts to develop estimates of the impacts of fuel conversion programs. The study began with development of baseline forecasts of energy use and CO 2 emissions. The forecasts are consistent with the U.S. Department of Energy (DOE) Energy Information Administration s (EIA s) Reference Case as presented in its 2008 Annual Energy Outlook (EIA AEO 2008). The study estimates the potential for energy savings and CO 2 emissions reductions during the years 2009 through 2030 for the residential, commercial, and industrial vii

10 sectors as a function of end-use technology, fuel-displaced, and census region. This analysis yields forecasts of changes in primary energy use and energy-related CO 2 emissions for the U.S. Those interested in this study may find the results of two other recent EPRI studies of interest. One of these recent studies falls under the first mechanism of upgrading existing electric technologies. Specifically, it assesses the potential of energy efficiency and demand response to yield electricity savings in the residential, commercial, and industrial sectors. 1 The other recent study investigates replacing fossil-fueled vehicles with plug-in hybrid electric vehicles; therefore, it is another expanded application of electricity and falls under the second mechanism. 2 Key Findings Energy Savings According to EIA AEO 2008, total annual energy consumption for the U.S. in the residential, commercial, industrial, and transportation sectors is estimated at quadrillion BTUs in 2008, including delivered energy and energy-related losses. The Reference Case forecasts this consumption to increase by 15.3% to quadrillion BTUs in 2030, an annualized growth rate from 2008 to 2030 of 0.65%. The Reference Case already accounts for market-driven efficiency improvements, the impacts of all currently legislated federal appliance standards and building codes (including the Energy Independence and Security Act of 2007) and rulemaking procedures. It is predicated on a relatively flat electricity price forecast in real dollars between 2008 and It also assumes continued contributions of existing utility- and government-sponsored end-use energy programs established prior to Relative to the EIA AEO 2008 Reference Case, this study identifies between 1.71 and 5.32 quadrillion BTUs per year of energy savings in 2030 due to expanded end-use applications of electricity. The lower bound represents the Realistic Potential while the upper bound represents the Technical Potential. Therefore, expanded end-use applications of electricity have the potential to reduce the annual growth rate in energy consumption forecasted in EIA AEO 2008 between 2008 and 2030 of 0.65% by 10% to 32%, to an annual growth rate of 0.58% to 0.44%. The lower bound of these estimated levels of energy savings are potentially achievable through voluntary fuel conversion programs implemented by utilities or similar entities. Our analysis does not assume the enactment of new codes and standards beyond what is already in law. More progressive codes and standards would yield even greater levels of energy savings. 1 Assessment of Achievable Potential from Energy Efficiency and Demand Response Programs in the U.S.: ( ). EPRI, Palo Alto, CA: Environmental Assessment of Plug-In Hybrid Electric Vehicles, Volume 1: Nationwide Greenhouse Gas Emissions, EPRI, Palo Alto, CA: viii

11 Reductions in CO 2 Emissions According to EIA AEO 2008, annual energy-related CO 2 emissions for the U.S. in the residential, commercial, industrial, and transportation sectors is estimated at 5,983 million metric tons in The Reference Case forecasts emissions to increase by 14.5% to 6,850 million metric tons in 2030, an annualized growth rate from 2008 to 2030 of 0.61%. The Reference Case is predicated on a relatively flat CO 2 intensity of the electricity generation mix between 2008 and Relative to the EIA AEO 2008 Reference Case, this study identifies between 114 and 320 million metric tons per year of CO 2 emissions reductions in 2030 due to expanded end-use applications of electricity. The lower bound represents the Realistic Potential while the upper bound represents the Technical Potential. Therefore, expanded end-use applications of electricity have the potential to reduce the annual growth rate in CO 2 emissions forecasted in EIA AEO 2008 between 2008 and 2030 of 0.61% by 12% to 35%, to an annual growth rate of 0.54% to 0.40%. The lower bound of these estimated levels of CO 2 emissions reductions are potentially achievable through voluntary fuel conversion programs implemented by utilities or similar entities. Our analysis does not assume the enactment of new codes and standards beyond what is already in law, nor does it assume the CO 2 -intensity of the electricity generation mix will decrease significantly in the future. More progressive codes and standards and a less carbonintensive generation mix would yield even greater levels of CO 2 emissions reductions. Analysis Approach The study used an analysis approach that is generally consistent with the methods described in EPRI s Energy Efficiency Planning Guidebook published in June The methodology in EPRI s guidebook is one that is used in developing energy efficiency and demand response potential studies as well as in designing programs. Figure ES-1 depicts the complete program analysis framework. Steps 1 through 5 in the figure show the steps applicable to potential studies. The focus of the study was on the Technical Potential; it was beyond the scope of the study to do a thorough evaluation of the effects of economics and customer response and, thus, estimating Economic and Achievable Potentials was not a focus for the study. However, the study considers a Realistic Potential that was estimated using the project team s professional judgment and industry experience. The Realistic Potential is a first approximation to an Achievable Potential. However, a more rigorous analysis using economic and customer preference criteria is needed to estimate a more accurate Achievable Potential. The study implemented a hybrid top-down and bottom-up approach for determining the potential for saving energy and reducing CO 2 emissions. For each sector, the baseline forecasts for energy use and CO 2 emissions were allocated down to fuel types, census regions, end-uses, sub-sectors (for the industrial sector only), and technologies. Figure ES-2 illustrates the energy use allocation down to the technology level for the industrial sector. Next, for each sector, the evaluation of the energy savings and reductions in CO 2 emissions were done at the technology level and then aggregated up to end-uses, census regions, and fuel types to estimate the Technical and Realistic Potentials. ix

12 1 Establishing Objectives 2 Baseline Forecasting 9 Evaluation, Measurement, and Verification 3 8 Technical & Economic Potentials Identifying and Screening Measures/Technologies Implementation and Monitoring 4 7 Achievable Potential Sizing Up Customer Response Measuring Cost Effectiveness Program Potential Technical, Economic & Achievable Potentials 5 6 Estimating Savings Potential Program Design Source: Energy Efficiency Planning Guidebook, EPRI , June 2008 Figure ES-1 Program Analysis Framework (This Study Focused on Technical and Realistic Potentials) x

13 Sector Industrial Sector Fuel Type Coal/Coke Natural Gas Fuel Oil Region Northeast Midwest South West End-Use Boilers Process Heating Space Heating Subsector(s) NAICS 313, NAICS 331 NAICS , Technology Electric Arc Furnace Plasma Melting Heat Pump Etc. Figure ES-2 Illustration of Industrial Sector Energy Use Allocation down to the Technology Level xi

14 The potential of an individual fuel conversion opportunity offered by an efficient electric end-use technology is a function of the opportunity s unit primary energy savings and reduction in CO 2 emissions relative to the fossil-fueled baseline technology. It is also a function of its technical applicability, the turnover rate of installed equipment, and maximum and realistic market penetration values. For a given fuel type and end-use, a baseline technology represents a discrete technology choice that complies with minimum existing efficiency standards (to the extent such standards exist) and is generally the most affordable and prevalent technology option in its enduse category. For each end-use category, other technology options are available that use different types of fuels and/or are more efficient. For example, natural gas furnaces are a common baseline technology for process heating in the industrial sector. In the approach for this study, efficient electric process heating technologies are applicable in existing industrial applications as replacements for natural gas furnaces that have reached the end of their expected useful life. They are also applicable to future industrial process heating applications anticipated to be met with natural gas furnaces. The primary focus of this study was to determine the Technical Potential, which represents the maximum, technically-feasible impacts that would result if the selected electric end-use technologies were to displace fossil-fueled technologies. This potential does not take into account cost-effectiveness or customer response, both of which would realistically decrease technology adoption. The study also considers a Realistic Potential. The approach for deriving the Realistic Potential is predicated on first establishing the theoretical constructs of the Technical Potential and then discounting it to reflect market and institutional constraints using professional judgment and industry experience to estimate more realistic values. This study applies the condition that new equipment is phased-in over time. Both the Technical and Realistic Potentials conform to this condition, and may be termed phase-in potentials. Essentially, the phase-in potentials in this study represent the energy savings and CO 2 reductions achieved if only the portion of the current stock of fossil-fueled equipment that has reached the end of its useful life and is due for turnover is replaced. Thus, the saturation of efficient electric end-use technologies is assumed to grow each year as more of the existing fossil-fueled equipment is up for replacement. In addition, any new equipment being brought on line in a given year due to market growth is assumed to be one of the applicable electric technologies. The analysis provided energy and CO 2 impacts as a function of several parameters for each electric end-use technology: Impacts by end-use sector (residential, commercial, and industrial); Impacts by displaced fuel type (natural gas, coal/coke, fuel oil, etc.); Impacts by census region (Northeast, Midwest, South, and West); and Impacts by year during the study period of 2009 to xii

15 The Starting Point Base-Year Energy Use by Sector and Fuel Type Before analysis of fuel conversion opportunities can take place, it is critical to understand how customers use different fuel types today. This study begins with the EIA AEO 2008 estimates of total primary energy use in 2008 for the residential, commercial, and industrial sectors. Figure ES-3 illustrates the breakdown by sector and fuel type. The data presented reflect direct end-use of primary resources as well as end-use of electricity and electricity-related losses. Industrial is the largest energy-consuming sector at quadrillion BTU, followed by residential at quadrillion BTU and commercial at quadrillion BTU. In both residential and commercial sectors, electricity is the major fuel choice for end-uses, followed by natural gas. In the industrial sector, liquid fuels and other types of petroleum products constitute the major fuel choice for end-uses, followed by natural gas and then delivered electricity (not including electricity-related losses). Base-Year CO 2 Emissions by Sector and Fuel Type It is also important to understand the major fuels that are currently contributing to CO 2 emissions for each sector. Figure ES-4 shows the EIA AEO 2008 estimates of energy-related CO 2 emissions as a function of sector and fuel type in The electricity portions of the pie charts reflect the fact that CO 2 emissions from electricity production have been allocated to the end-use sectors. Industrial is the largest CO 2 -emitting sector at 1,689 million metric tons, followed by residential at 1,247 million metric tons, and commercial at 1,078 million metric tons in Electricity currently accounts for the greatest share of emissions in all sectors, followed by natural gas in the residential and commercial sectors and petroleum in the industrial sector. xiii

16 Liquid Fuels and Other Petroleum 6% Natural Gas 23% Electricity-Related Losses 47% Electricity 22% Renewable Energy 2% Coal 0.05% Residential (21.99 Quadrillion BTU) Liquid Fuels and Other Petroleum 4% Natural Gas 17% Electricity 25% Renewable Energy 1% Coal 0.5% Commercial (18.60 Quadrillion BTU) Electricity- Related Losses 53% Coal 6% Electricity 10% Renewable Energy 5% Biofuels Heat and Coproducts 2% Liquid Fuels and Other Petroleum 31% Electricity- Related Losses 22% Natural Gas 24% Industrial (33.22 Quadrillion BTU) Figure ES U.S. Total Primary Energy Consumption by Sector and Fuel Type from the EIA s 2008 Annual Energy Outlook (EIA AEO 2008) xiv

17 Petroleum 8% Coal 0.08% Petroleum 5% Coal 1% Natural Gas 21% Natural Gas 15% Electricity 71% Electricity 79% Residential (1,247 Million Metric Tons) Commercial (1,078 Million Metric Tons) Coal 12% Electricity 38% Natural Gas 24% Petroleum 26% Industrial (1,689 Million Metric Tons) Figure ES U.S. Energy-Related CO 2 Emissions by Sector and Fuel Type from the EIA s 2008 Annual Energy Outlook (EIA AEO 2008) xv

18 The Baseline Forecast The EIA AEO 2008 Reference Case forecasts for total primary energy consumption and energyrelated CO 2 emissions are shown in Figures ES-5 and ES-6, respectively. The data include all four end-use sectors (residential, commercial, industrial, and transportation); in addition, energy and CO 2 impacts from the electricity sector have been allocated to each end-use sector. As Figure ES-5 shows, the industrial sector is currently the largest energy user followed by the transportation, residential, and then commercial sectors. By 2030, the industrial sector is still forecasted to be the largest consumer (35.0 quadrillion BTUs per year), but the transportation sector is very close in second place (33.0 quadrillion BTUs per year). In addition, the residential and commercial sectors are projected to be tied for third place (25.0 quadrillion BTUs per year). Overall, total energy consumption for all sectors combined is expected to increase by 15.3% between 2008 and 2030, an annualized growth rate of 0.65%. The Reference Case accounts for market-driven efficiency improvements, the impacts of all currently legislated federal appliance standards and building codes, rulemaking procedures, and continued contributions of existing utility- and government-sponsored end-use energy programs established prior to Total Primary Energy Consumption - By Sector Quadrillion BTU Transportation Industrial Commercial Residential Figure ES-5 Forecast of Total Primary Energy Consumption by End-Use Sector from the EIA s 2008 Annual Energy Outlook (EIA AEO 2008) xvi

19 Energy-Related CO 2 Emissions - By Sector 8,000 7,000 Million Metric Tons. 6,000 5,000 4,000 3,000 2,000 Transportation Industrial Commercial 1,000 Residential Figure ES-6 Forecast of Energy-Related CO 2 Emissions by End-Use Sector from the EIA s 2008 Annual Energy Outlook (EIA AEO 2008) In terms of CO 2 emissions, Figure ES-6 shows that the transportation sector is currently the largest producer of emissions followed by the industrial, residential, and then commercial sectors. By 2030, the transportation sector is still forecasted to be the largest emitter (2,193 million metric tons per year), with the industrial sector in second place (1,733 million metric tons per year). However, the commercial sector (1,474 million metric tons per year) is expected to outpace the residential sector (1,450 million metric tons per year) by Between 2008 and 2030, energy-related CO 2 emissions for all sectors combined are expected to increase by 14.5%, an annualized growth rate of 0.61%. Note that the Reference Case is predicated on a relatively flat CO 2 intensity of the electricity generation mix between 2008 and The current focus on reducing greenhouse gas emissions and legislation under consideration will probably result in a reduction in the CO 2 intensity of the electricity generation mix in future years. However, for the purpose of this study it was necessary to select a baseline forecast. After considering other alternatives, the project team ultimately chose the EIA AEO 2008 Reference Case for the baseline forecast to be consistent with EPRI s previous analyses and other industry studies. It represents a solid foundation or somewhat stable data for comparison. xvii

20 The Potential for Saving Energy and Reducing CO 2 Emissions Identifying and Screening Technologies The analysis of potential impacts from expanding end-use applications of electricity began with a long list of efficient electric end-use technologies. Tables ES-1 through ES-3 summarize all of the electric end-use technologies analyzed in the study as well as the fossil-fueled technologies they are assumed to replace. The technologies are categorized by sector and applicable end-use area. As the tables show, the project team analyzed a total of eight residential, twenty commercial, and twelve industrial electric technologies. Table ES-1 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil- Fueled Technologies in the Residential Sector End-Use Area Efficient Electric End-Use Technology Displaced Fossil-Fueled Technology Clothes Drying Heat Pump Clothes Dryer Natural Gas Clothes Dryer Cooking Electric Oven Natural Gas Oven Inductive Range Top Natural Gas Range Top Pool/Spa Heating Heat Pump Pool/Spa Heater Distillate Fuel Oil Pool Heater Natural Gas Pool Heater Propane/LPG Pool Heater Space Cooling Air-Source Heat Pump Natural Gas Heat Pump Ground-Source Heat Pump Natural Gas Heat Pump Space Heating Air-Source Heat Pump Coal Heating Stove Distillate Fuel Oil Boiler Distillate Fuel Oil Furnace Kerosene Furnace Kerosene Portable Heater Natural Gas Boiler Natural Gas Furnace Natural Gas Heat Pump Natural Gas Vented Direct Heating Propane/LPG Boiler Propane/LPG Furnace Propane/LPG Vented Direct Heating Ground-Source Heat Pump Same as air-source heat pump Water Heating Electric Instantaneous Water Heater Distillate Fuel Oil Storage Natural Gas Instantaneous Natural Gas Storage Propane/LPG Instantaneous Propane/LPG Storage Heat Pump Water Heater Same as electric instantaneous xviii

21 Table ES-2 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil- Fueled Technologies in the Commercial Sector End-Use Area Efficient Electric End-Use Technology Displaced Fossil-Fueled Technology Clothes Drying Heat Pump Clothes Dryer Natural Gas Clothes Dryer Cooking Electric Braising Pan Natural Gas Braising Pan Electric Broiler Natural Gas Broiler Electric Griddle Natural Gas Griddle Electric Fryer, Flat Bottom Natural Gas Fryer, Flat Bottom Electric Fryer, Open Deep Fat Electric Fryer, Pressure/Kettle Electric Oven, Conveyor Electric Oven, Deck Electric Oven, Rotisserie Electric Oven, Standard/Convection Electric Range Top Electric Steamer, Compartment Electric Steamer, Kettle Electric Wok Natural Gas Fryer, Open Deep Fat Natural Gas Fryer, Pressure/Kettle Natural Gas Oven, Conveyor Natural Gas Oven, Deck Natural Gas Oven, Rotisserie Natural Gas Oven, Standard/Convection Natural Gas Range Top Natural Gas Steamer, Compartment Natural Gas Steamer, Kettle Natural Gas Wok Pool/Spa Heating Heat Pump Pool/Spa Heater Distillate Fuel Oil Pool Heater Natural Gas Pool Heater Space Cooling Air-Source Heat Pump Natural Gas Space Cooling Ground-Source Heat Pump Natural Gas Space Cooling Space Heating Electric Boiler Distillate Fuel Oil Boiler Natural Gas Boiler Residual Fuel Oil Boiler Air-Source Heat Pump Distillate Fuel Oil Boiler Distillate Fuel Oil Furnace Natural Gas Boiler Natural Gas Furnace Natural Gas Vented Direct Heating Residual Fuel Oil Boiler Ground-Source Heat Pump Same as air-source heat pump Water Heating Heat Pump Water Heater Distillate Fuel Oil Storage Natural Gas Instantaneous Natural Gas Storage xix

22 Table ES-3 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil- Fueled Technologies in the Industrial Sector End-Use Area Efficient Electric End-Use Technology Displaced Fossil-Fueled Technology Manufacturing Industries Boilers Electric Boiler Natural Gas Boiler Fuel Oil Boiler Coal-Fired Boiler Electric Drive Natural Gas Boiler Fuel Oil Boiler Coal-Fired Boiler Space Heating Heat Pump Natural Gas Furnace Process Heating Heat Pump Natural Gas Furnace Induction Heating Direct-Fired Natural Gas Radio Frequency Heating Direct-Fired Natural Gas Microwave Heating Direct-Fired Natural Gas Electric Infrared Heating Direct-Fired Natural Gas UV Heating Direct-Fired Natural Gas Electric Arc Furnace Coke Blast Furnace Electric Induction Melting Natural Gas Furnace Plasma Melting Natural Gas Furnace Electrolytic Reduction Natural Gas Furnace The technologies in the long list were screened to determine if they met the criteria required for inclusion in the final analysis. The primary criterion of importance was the ability of the electric end-use technology to decrease overall CO 2 emissions relative to the baseline fossil-fueled technology. Therefore, during the screening process the project team determined potential reductions in CO 2 emissions at the technology level. If displacing a fossil-fueled technology with a given electric technology increased overall CO 2 emissions during the study period, the technology failed the screening process and was eliminated from the Technical and Realistic Potential calculations. Only the short-list of passing or favorable electric end-use technologies was included in the potential estimates. The results of the screening process yielded the short list of favorable electric end-use technologies shown in Tables ES-4 through ES-6. Of the eight residential electric technologies analyzed, six resulted in net reductions in CO 2 emissions; of the twenty commercial electric technologies analyzed, ten resulted in net reductions in CO 2 emissions; and of the twelve industrial electric technologies analyzed, only five resulted in net reductions in CO 2 emissions under the scenario evaluated. xx

23 Table ES-4 Short List of Favorable Residential Electric End-Use Technologies Capable of Yielding Net Reductions in CO 2 Emissions Electric End-Use Technologies Yielding Net Reductions in CO 2 Emissions Electric Technologies Analyzed (Long List) Net Decrease in CO 2 Emissions? Favorable Electric Technologies (Short List) Heat Pump Clothes Dryer Yes (All but Midwest) Heat Pump Clothes Dryer Heat Pump Pool/Spa Heater Yes Heat Pump Pool/Spa Heater Air-Source Heat Pump, Cooling Yes Air-Source Heat Pump, Cooling Air-Source Heat Pump, Heating Yes Air-Source Heat Pump, Heating Ground-Source Heat Pump, Cooling Yes Ground-Source Heat Pump, Cooling Ground-Source Heat Pump, Heating Yes Ground-Source Heat Pump, Heating Electric Instantaneous Water Heater Yes (Only Northeast) Electric Instantaneous Water Heater Heat Pump Water Heater Yes Heat Pump Water Heater Electric Convection Oven No Electric Induction Range Top No Table ES-5 Short List of Favorable Commercial Electric End-Use Technologies Capable of Yielding Net Reductions in CO 2 Emissions Electric End-Use Technologies Yielding Net Reductions in CO 2 Emissions Electric Technologies Analyzed (Long List) Net Decrease in CO 2 Emissions? Favorable Electric Technologies (Short List) Heat Pump Clothes Dryers Yes (All but Midwest) Heat Pump Clothes Dryers Electric Broiler Yes (Northeast, West) Electric Broiler Electric Oven, Conveyor Yes (Northeast, West) Electric Oven, Conveyor Electric Oven, Deck Yes (Northeast) Electric Oven, Deck Electric Oven, Rotisserie Yes (Northeast) Electric Oven, Rotisserie Electric Wok Yes (Northeast, West) Electric Wok Heat Pump Pool/Spa Heater Yes Heat Pump Pool/Spa Heater Air-Source Heat Pump, Cooling Yes Air-Source Heat Pump, Cooling Air-Source Heat Pump, Heating Yes Air-Source Heat Pump, Heating Ground-Source Heat Pump, Cooling Yes Ground-Source Heat Pump, Cooling Ground -Source Heat Pump, Heating Yes Ground -Source Heat Pump, Heating Heat Pump Water Heater Yes Heat Pump Water Heater Electric Braising Pan No Electric Griddle No Electric Fryer, Flat Bottom No Electric Fryer, Open Deep Fat No Electric Fryer, Pressure/Kettle No Electric Oven, No Standard/Convection/Combination Electric Range Top No Electric Steamer, Compartment No Electric Steamer, Kettle No Electric Boilers No xxi

24 xxii Table ES-6 Short List of Favorable Industrial Electric End-Use Technologies Capable of Yielding Net Reductions in CO 2 Emissions Electric End-Use Technologies Yielding Net Reductions in CO 2 Emissions Electric Technologies Analyzed (Long List) Net Decrease in CO 2 Emissions? Favorable Electric Technologies (Short List) Heat Pump Yes Heat Pump Plasma Melting Yes Plasma Melting Electrolytic Reduction Yes Electrolytic Reduction Electric Induction Melting Yes Electric Induction Melting Electric Arc Furnace Yes Electric Arc Furnace Electric Boiler No Electric Drive No Induction Heating No Radio Frequency Heating No Microwave Heating No Electric Infrared Heating No UV Heating No It is very important to stress here that the outcome of the screening exercise is highly dependent on the projected CO 2 intensity of the electricity generation mix of the future. As already explained, the baseline forecast used for the current study was derived from the EIA AEO This forecast information does not presume that future policy changes may lower the CO 2 intensity of the generation mix during the study period. However, with the present momentum to curb greenhouse gas emissions, there is a possibility that policies affecting the CO 2 intensity will be enacted in the near future. With a lower CO 2 intensity of the generation mix, more of the electric technologies analyzed would fall under the favorable category. Indeed, additional electric technologies would cross the line and become favorable if the CO 2 emissions factors decreased even modestly between now and For example, a 10% reduction in CO 2 emissions factors would make the following industrial electric end-use technologies favorable in the regions indicated: Northeast o Electric boilers replacing coal-fired boilers; o Induction heating replacing direct-fired natural gas; o Radio frequency heating replacing direct-fired natural gas; o Microwave heating replacing direct-fired natural gas; o Electric infrared heating replacing direct-fired natural gas; and o UV heating replacing direct-fired natural gas. Midwest o Plasma melting replacing natural gas furnaces; and o Electric induction melting replacing natural gas furnaces.

25 Annual Technical and Realistic Potentials by Sector Table ES-7 summarizes the Technical and Realistic Potential results by end-use sector for the favorable electric end-use technologies. The results are presented as annual values and thus represent the impacts for the given year they are essentially a snap-shot in time. For the Technical Potential, the table shows that the residential sector has the greatest promise for beneficial impacts. The commercial and industrial sectors follow with values that are roughly comparable to each other. The Technical Potential impacts of all three sectors combined are energy savings of 5.32 quadrillion BTUs per year and CO 2 emissions reductions of 320 million metric tons per year in 2030 relative to the baseline forecast. Table ES-7 Technical and Realistic Potential: Annual Impacts on Primary Energy Use and CO 2 Emissions by Sector Baseline EIA AEO 2008 Baseline Forecast of Primary Energy Use (Quadrillion BTUs per Year) EIA AEO 2008 Baseline Forecast of Energy-Related CO 2 Emissions (Million Metric Tons per Year) Sector Residential ,259 1,323 1,450 Commercial ,080 1,265 1,474 Industrial ,693 1,718 1,733 Transportation ,980 2,077 2,193 U.S ,012 6,383 6,850 Technical Potential Decrease in Primary Energy Use (Quadrillion BTUs per Year) Decrease in CO 2 Emissions (Million Metric Tons per Year) Sector Residential Commercial Industrial U.S Realistic Potential Decrease in Primary Energy Use (Quadrillion BTUs per Year) Decrease in CO 2 Emissions (Million Metric Tons per Year) Sector Residential Commercial Industrial U.S xxiii

26 In the Realistic Potential case, the industrial sector has the highest potential for energy savings, followed by the residential sector and then commercial sector. In regards to the Realistic Potential for CO 2 reductions, the residential sector holds the greatest promise, followed by the industrial sector and then the commercial sector. The Realistic Potential impacts of all three sectors combined are energy savings of 1.71 quadrillion BTUs per year and CO 2 emissions reductions of 114 million metric tons per year in 2030 relative to the baseline forecast. Figures ES-7 and ES-8 graphically display the combined impacts of the three sectors relative to the baseline forecasts for primary energy consumption and CO 2 emissions, respectively. The primary energy baseline data include all delivered energy for the residential, commercial, industrial, and transportation sectors as well as electricity-related losses. Similarly, the CO 2 baseline forecast includes total energy-related CO 2 emissions across all sectors. Both Technical and Realistic Potential impacts are plotted against the baselines. In terms of the potential for energy savings (Figure ES-7), the Technical Potential is associated with a 4.5% reduction relative to the baseline in the year 2030, while the Realistic Potential yields a 1.5% decrease in For CO 2 emissions (Figure ES-8), the Technical Potential reduces baseline emissions by 4.7% in the year 2030 and the Realistic Potential reduces baseline emissions by 1.7% during the same year. Comparison with Baseline Forecast Primary Energy Historic Forecast Historic EIA Reference Case Realistic Potential Technical Potential 4.5% 1.5% Figure ES-7 Historic and Forecasted Primary Energy Consumption: Combined Impacts of Three Sectors Compared with Baseline Forecast xxiv

27 7,000 Comparison with Baseline Forecast 1.7% CO2 Emissions (Million Metric Tons). 6,500 6,000 5,500 5,000 4,500 4,000 Historic Forecast 4.7% Historic EIA Reference Case Realistic Potential Technical Potential Figure ES-8 Historic and Forecasted Energy-Related CO 2 Emissions: Combined Impacts of Three Sectors Compared with Baseline Forecast These estimates suggest that expanded end-use applications of electricity have the potential to reduce the annual growth rate in energy consumption forecasted in EIA AEO 2008 between 2008 and 2030 of 0.65% by 10% to 32%, to an annual growth rate of 0.58% to 0.44%. In addition, they have the potential to reduce the annual growth rate in CO 2 emissions forecasted in EIA AEO 2008 between 2008 and 2030 of 0.61% by 12% to 35%, to an annual growth rate of 0.54% to 0.40%. Cumulative Technical Potential by Technology Table ES-8 shows the cumulative Technical Potential impacts on primary energy use and CO 2 emissions by electric technology for the residential sector. The cumulative numbers represent cumulative impacts between the study s start year of 2009 and the given year. Thus, a value listed for a given year includes all impacts accumulated between 2009 and that year. Space heating represents about 74% of residential fossil fuel consumption annually over the forecast period and presents the biggest potential for energy and CO 2 savings. Displacement of fossilfueled space heating with heat pumps results in cumulative energy savings of 32.3 quadrillion BTUs and cumulative CO 2 reductions of 1,970 million metric tons from 2009 to Fossilfueled water heating represents about 18% of fossil fuel consumption in the residential sector over the forecast period. Heat pump water heaters have the potential to save 9.59 quadrillion BTUs and reduce CO 2 emissions by 573 million metric tons. Finally, heat pump clothes dryers have the potential to save 0.14 quadrillion BTUs and to reduce CO 2 emissions by 14.4 million metric tons. In total, these three electric technologies have the potential to reduce primary energy xxv

28 consumption by 42.1 quadrillion BTUs and reduce CO 2 emissions by 2,557 million metric tons from 2009 to Table ES-8 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Favorable Electric End- Use Technology Heat Pump Space Heating ,252 1,970 Heat Pump Water Heater Heat Pump Clothes Dryer Total ,669 2,557 Table ES-9 shows the cumulative impacts on primary energy use and CO 2 emissions by electric technology for the commercial sector. Space heating represents about 40% of fossil fuel consumption annually over the forecast period and presents the biggest potential for energy and CO 2 savings in the commercial sector. Displacement of fossil-fueled space heating with heat pumps results in cumulative energy savings of 11.4 quadrillion BTUs and cumulative CO 2 reductions of 740 million metric tons from 2009 to Fossil-fueled water heating represents about 16% of fossil fuel consumption in the commercial sector over the forecast period. Heat pump water heaters have the potential to save 2.73 quadrillion BTUs and reduce CO 2 emissions by 181 million metric tons. Finally, heat pump space cooling has the potential to save 0.16 quadrillion BTUs and to reduce CO 2 emissions by 8.99 million metric tons. In total, these three electric technologies have the potential to reduce primary energy consumption by 14.3 quadrillion BTUs and reduce CO 2 emissions by 930 million metric tons between 2009 and Table ES-9 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Commercial Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Favorable Electric End- Use Technology Heat Pump Space Heating Heat Pump Water Heater Heat Pump Space Cooling Total Table ES-10 lists the cumulative impacts on primary energy use and CO 2 emissions by electric technology for the industrial sector. Each value in the table represents the nationwide cumulative impacts between the start date of 2009 and the given year. By 2030, heat pumps are projected to xxvi

29 potentially save 12.2 quadrillion BTUs of energy and reduce CO 2 emissions by 634 million metric tons. They represent the technology with the greatest potential for beneficial impacts. Electric arc furnaces are projected to yield energy savings of 1.70 quadrillion BTUs and CO 2 reductions of 198 million metric tons between 2009 and Electrolytic reduction has the potential to reduce energy use by quadrillion BTUs and CO 2 emissions by 35.6 million metric tons. Electric induction melting could potentially save quadrillion BTUs while reducing CO 2 emissions by 22.1 million metric tons. Lastly, plasma melting is projected to reduce energy use by quadrillion BTUs and CO 2 emissions by 21.4 million metric tons. The combined results of all industrial technologies implemented across the U.S. are cumulative energy savings of 15.3 quadrillion BTUs and cumulative CO 2 emissions reductions of 911 million metric tons between 2009 and Table ES-10 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-use Technology (Industrial Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Favorable Electric End-Use Technology Heat Pump Electric Arc Furnace Electrolytic Reduction Electric Induction Melting Plasma Melting Total Figures ES-9 and ES-10 graphically depict the impacts of the electric end-use technologies on primary energy use and energy-related CO 2 emissions, respectively. Once again, the values are expressed in terms of the cumulative Technical Potential impacts between 2009 and In all three sectors, heat pumps are the technology with the greatest promise for saving energy and reducing CO 2 emissions. In the industrial sector, electric arc furnaces have a significant potential for beneficial impacts as well. In addition, electrolytic reduction, electric induction melting, and plasma melting also show promise. Under a less carbon-intensive future generation mix, more technologies would cross the line and become favorable in regards to saving energy and reducing emissions. In both the residential and commercial sectors, the end-use areas with the most potential for beneficial impacts are space heating and then water heating. Clothes drying (residential) and space cooling (commercial) also exhibit potential. In the industrial sector, process heating is the predominant end-use area showing potential, followed by space heating. xxvii

30 Industrial Plasma Melting Electric Induction Melting Electrolytic Reduction Electric Arc Furnace Heat Pumps 12.2 Commercial Heat Pump Space Cooling Heat Pump Water Heating Heat Pump Space Heating Residential Heat Pump Clothes Drying Heat Pump Water Heating Heat Pump Space Heating Cumulative Decrease in Primary Energy Use Figure ES-9 Technical Potential: Cumulative Decrease in Primary Energy Use Between 2009 and 2030 by Sector and Efficient Electric End-Use Technology Plasma Melting 21 Industrial Electric Induction Melting Electrolytic Reduction Electric Arc Furnace Heat Pumps 634 Commercial Heat Pump Space Cooling Heat Pump Water Heating Heat Pump Space Heating Residential Heat Pump Clothes Drying Heat Pump Water Heating Heat Pump Space Heating , ,000 1,500 2,000 2,500 Cumulative Decrease in CO 2 Emissions (Million Metric Tons) Figure ES-10 Technical Potential: Cumulative Decrease in Energy-Related CO 2 Emissions Between 2009 and 2030 by Sector and Efficient Electric End-Use Technology xxviii

31 Cumulative Technical Potential by U.S. Census Region This study disaggregates energy use and CO 2 emissions by the four U.S. Census regions shown in Figure ES-11: Northeast, South, Midwest, and West. Figure ES-11 U.S. Census Regions Table ES-11 lists the combined cumulative impacts of the favorable electrotechnologies evaluated for the residential, commercial, and industrial sectors by U.S. census region. The values represent Technical Potentials. For all sectors combined, the potential for energy savings is highest in the South, followed by the Midwest, Northeast, and then the West. For reductions in CO 2 emissions, the combined potential is greatest in the Northeast, followed by the South, the Midwest, and then the West. Nationwide, the cumulative Technical Potential for energy savings is 71.1 quadrillion BTUs between 2009 and The corresponding cumulative reduction in CO 2 emissions during this period is 4,400 million metric tons. xxix

32 Table ES-11 Technical Potential: Cumulative Impacts of Beneficial Electrification on Primary Energy Use and CO 2 Emissions by Region (Residential, Commercial, and Industrial Sectors) Residential, Commercial and Industrial Sectors Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) All Favorable Electrotechnologies Northeast ,260 Midwest ,080 South ,200 West U.S ,470 4,400 Figures ES-12 and ES-13 depict the regional shares of cumulative Technical Potential impacts by end-use sector for the cases of energy savings and reductions in CO 2 emissions, respectively. In the residential sector, the potential for energy savings is greatest in the Midwest, followed by the South, Northeast, and then West; for CO 2 reductions, the order from greatest to least potential is Northeast, Midwest, South, and West. In the commercial sector, the South has the highest potential for energy savings, followed by Northeast, Midwest, and then West. CO 2 reductions in the commercial sector are potentially greatest in the Northeast, then the South, Midwest, and West. For the industrial sector, the potential for both energy savings and CO 2 reductions is greatest in the South, followed in descending order by the Midwest, West, and Northeast. xxx

33 45 Cumulative Decrease in Primary Energy. Use % West South 26% Midwest Northeast 30% 15% 18% 29% 54% 25% 27% 23% 27% Residential Commercial Industrial 8% Figure ES-12 Technical Potential: Cumulative Decrease in Primary Energy Use Between 2009 and 2030 by Sector and U.S. Census Region 3000 Cumulative Decrease in CO 2 Emissions (Million Metric Tons) % West South Midwest 23% Northeast 25% 19% 19% 23% 45% 33% 22% 36% 27% 10% Residential Commercial Industrial Figure ES-13 Technical Potential: Cumulative Decrease in Energy-Related CO 2 Emissions Between 2009 and 2030 by Sector and U.S. Census Region xxxi

34 Conclusions and Implications The potential for saving energy and reducing CO 2 emissions by expanding end-use applications of electricity is significant. For all three sectors combined, the cumulative Technical Potential for energy savings is 71.7 quadrillion BTUs and the cumulative Technical Potential for CO 2 reductions is 4,400 million metric tons between 2009 and These values equate to annual impacts in 2030 of 5.32 quadrillion BTUs per year (4.5% of baseline primary energy use) and 320 million metric tons per year (4.7% of baseline emissions). In terms of Realistic Potential, the sectors combined have a cumulative potential for energy savings of 21.0 quadrillion BTUs and a cumulative potential for CO 2 reductions of 1,490 million metric tons. The Realistic Potential values are associated with annual impacts in 2030 of 1.71 quadrillion BTUs per year (1.5% of baseline primary energy use) and 114 million metric tons per year (1.7% of baseline emissions). Achieving these impacts will require significant industry investment in programs that promote expanding end-use applications of electricity. Applying the Results This potential study represents a hybrid top-down and bottom-up analysis based on adoption of efficient electric end-use technologies to replace less efficient fossil-fueled technologies in place or planned. Replacement of existing technologies is assumed to take place as equipment stock is due for turnover. The analysis was conducted at the technology, end-use, fuel type, and sector levels for four U.S. Census regions. This study was undertaken to provide an independent estimate of the potential to save energy and reduce CO 2 emissions by expanding the end-use applications of electricity in order to inform utilities, policymakers, regulators, and other stakeholder groups. The regional results in particular can serve as useful calibration points to compare against any similar state or utility potential studies. Utilities can examine the major areas of potential specific to their region with their own allocation of resources. Follow-on Research Because of the issues described previously with choosing an appropriate baseline for the analysis, one potential next step would be to examine the potential for expanding end-use applications of electricity under a less carbon-intensive future electricity generation mix. Another would be to conduct a rigorous analysis of the Economic and Achievable Potentials using economic and customer preference criteria. The following bullet points list some of the factors that could affect the potential results provided in the report. Addressing any or all of these factors in a future study would increase the breadth of knowledge pertaining to the impact of expanding end-use applications of electricity on energy use and CO 2 emissions. Some of the factors would act to strengthen the argument for it (e.g., policies aimed at lowering the CO 2 intensity of the generation mix), while others may weaken it (e.g., higher electricity prices). xxxii

35 Greenhouse gas policies aimed at reducing the CO 2 intensity of the electricity generation mix; Regulatory environment supportive of utility activities that save energy and reduce greenhouse gas emissions; New codes and standards for equipment; Technology innovation and/or commercialization; and Higher (or lower) electricity prices relative to the prices of fossil fuels. xxxiii

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37 CONTENTS EXECUTIVE SUMMARY Key Findings...viii Energy Savings...viii Reductions in CO 2 Emissions... ix Analysis Approach... ix The Starting Point...xiii Base-Year Energy Use by Sector and Fuel Type...xiii Base-Year CO 2 Emissions by Sector and Fuel Type...xiii The Baseline Forecast...xvi The Potential for Saving Energy and Reducing CO 2 Emissions... xviii Identifying and Screening Technologies...xviii Annual Technical and Realistic Potentials by Sector...xxiii Cumulative Technical Potential by Technology...xxv Cumulative Technical Potential by U.S. Census Region...xxix Conclusions and Implications...xxxii Applying the Results...xxxii Follow-on Research...xxxii 1 INTRODUCTION Background Objectives Project Approach Task 1: Identify and Characterize Efficient Electric End-Use Technologies Task 2: Develop Baseline Forecasts Task 3: Estimate Energy Savings and CO 2 Reduction Potential Task 4: Prepare Final Report Final Report Structure xxxv

38 2 EFFICIENT ELECTRIC END-USE TECHNOLOGIES Analyzed Electric End-Use Technologies Residential Sector Energy Use Characteristics Merits of Electric End-Use Technologies Beyond Energy Efficiency Commercial Sector Energy Use Characteristics Merits of Electric End-Use Technologies Beyond Energy Efficiency Industrial Sector Energy Use Characteristics Merits of Electric End-Use Technologies Beyond Energy Efficiency ENERGY AND CO 2 BASELINE FORECASTS Sector Data Regional Data Fuel Data Industrial Subsector Data TECHNICAL AND REALISTIC POTENTIALS Residential Sector Methodology Favorable Electric End-Use Technologies Technical Potential Heat Pump Clothes Drying Heat Pumps for Space Heating Displacing Coal Space Heating Displacing Distillate Fuel Oil Space Heating Displacing Kerosene Space Heating Displacing Natural Gas Space Heating Displacing Propane/LPG Space Heating Heat Pumps for Water Heating Displacing Distillate Fuel Oil Water Heating Displacing Natural Gas Water Heating Displacing Propane/LPG Water Heating xxxvi

39 Realistic Potential Commercial Sector Methodology Favorable Electric End-Use Technologies Technical Potential Heat Pumps for Space Cooling Heat Pumps for Space Heating Displacing Distillate Fuel Oil Space Heating Displacing Natural Gas Space Heating Displacing Residual Fuel Oil Space Heating Displacing Coal Space Heating Heat Pumps for Water Heating Displacing Distillate Fuel Oil Water Heating Displacing Natural Gas Water Heating Realistic Potential Industrial Sector Methodology Favorable Electric End-Use Technologies Technical Potential Heat Pumps Plasma Melting Electrolytic Reduction Electric Induction Melting Electric Arc Furnace Realistic Potential CONCLUSION Key Findings Next Steps BIBLIOGRAPHY A ENERGY EFFICIENCY RATIOS... A-1 Residential Sector... A-1 Commercial Sector... A-2 Industrial Sector... A-4 xxxvii

40 B MARKET SHARES FOR INDUSTRIAL TECHNOLOGIES... B-1 C LIFETIMES FOR DISPLACED FOSSIL-FUELED EQUIPMENT... C-1 Residential Sector... C-1 Commercial Sector... C-2 Industrial Sector... C-3 D PRIMARY TO DELIVERED ELECTRICITY RATIOS... D-1 All Sectors... D-1 E CO 2 EMISSION FACTORS... E-1 Fossil Fuels... E-1 Electricity Generation... E-1 F TECHNICAL POTENTIAL RESULTS RESIDENTIAL SECTOR...F-1 Favorable Electric End-Use Technologies...F-1 Displacing Coal Technologies...F-2 Ground-Source Heat Pumps...F-2 Displacing Distillate Fuel Oil Technologies...F-3 Ground-Source Heat Pumps...F-3 Heat Pump Water Heaters...F-4 Displacing Kerosene Technologies...F-5 Ground-Source Heat Pumps...F-5 Displacing Natural Gas Technologies...F-6 Ground-Source Heat Pumps...F-6 Heat Pump Clothes Dryers...F-7 Heat Pump Water Heaters...F-8 Displacing Propane/LPG Technologies...F-9 Ground-Source Heat Pumps...F-9 Heat Pump Water Heaters...F-10 G TECHNICAL POTENTIAL RESULTS COMMERCIAL SECTOR...G-1 Favorable Electric End-Use Technologies...G-1 Displacing Distillate Fuel Oil Technologies...G-2 Ground-Source Heat Pumps...G-2 Heat Pump Water Heaters...G-3 xxxviii

41 Displacing Natural Gas Technologies...G-4 Ground-Source Heat Pumps Space Cooling...G-4 Ground-Source Heat Pumps Space Heating...G-5 Heat Pump Water Heaters...G-6 Displacing Residual Fuel Oil Technologies...G-7 Ground-Source Heat Pumps...G-7 Displacing Coal Technologies...G-8 Ground-Source Heat Pumps...G-8 H TECHNICAL POTENTIAL RESULTS INDUSTRIAL SECTOR... H-1 Displacing Natural Gas Technologies... H-1 Electric Boilers... H-1 Electric Drives... H-2 Heat Pumps... H-3 Induction Heating... H-4 Radio Frequency Heating... H-5 Microwave Heating... H-6 Electric Infrared Heating... H-7 UV Heating... H-8 Plasma Melting... H-9 Electrolytic Reduction... H-10 Electric Induction Melting... H-11 Displacing Coal/Coke Technologies... H-12 Electric Boilers... H-12 Electric Drives... H-13 Electric Arc Furnace... H-14 Displacing Fuel Oil Technologies... H-15 Electric Boilers... H-15 Electric Drives... H-16 I REALISTIC POTENTIAL RESULTS RESIDENTIAL SECTOR...I-1 Displacing Coal Technologies...I-1 Heat Pumps...I-1 Displacing Distillate Fuel Oil Technologies...I-2 Heat Pumps...I-2 xxxix

42 Electric Instantaneous Water Heaters...I-3 Heat Pump Water Heaters...I-4 Displacing Kerosene Technologies...I-5 Heat Pumps...I-5 Displacing Natural Gas Technologies...I-6 Heat Pumps...I-6 Heat Pump Clothes Dryers...I-7 Heat Pump Water Heaters...I-8 Displacing Propane/LPG Technologies...I-9 Heat Pumps...I-9 Heat Pump Water Heaters...I-10 J REALISTIC POTENTIAL RESULTS COMMERCIAL SECTOR...J-1 Displacing Distillate Fuel Oil Technologies...J-1 Heat Pumps... J-1 Heat Pump Water Heaters...J-2 Displacing Natural Gas Technologies...J-3 Heat Pumps Space Cooling...J-3 Heat Pumps Space Heating...J-4 Heat Pump Water Heaters...J-5 Displacing Residual Fuel Oil Technologies...J-6 Heat Pumps... J-6 Displacing Coal Technologies...J-7 Heat Pumps... J-7 K REALISTIC POTENTIAL RESULTS INDUSTRIAL SECTOR... K-1 Displacing Natural Gas Technologies... K-1 Electric Boilers... K-1 Electric Drives... K-2 Heat Pumps... K-3 Induction Heating... K-4 Radio Frequency Heating... K-5 Microwave Heating... K-6 Electric Infrared Heating... K-7 UV Heating... K-8 xl

43 Plasma Melting... K-9 Electrolytic Reduction... K-10 Electric Induction Melting... K-11 Displacing Coal/Coke Technologies... K-12 Electric Boilers... K-12 Electric Drives... K-13 Electric Arc Furnace... K-14 Displacing Fuel Oil Technologies... K-15 Electric Boilers... K-15 Electric Drives... K-16 L IMPACTS ON ELECTRICITY AND FOSSIL FUEL USE FAVORABLE ELECTRIC TECHNOLOGIES...L-1 Residential Sector...L-1 Technical Potential...L-1 By Technology...L-1 By Region...L-2 Realistic Potential...L-4 By Technology...L-4 By Region...L-6 Commercial Sector...L-8 Technical Potential...L-8 By Technology...L-8 By Region...L-9 Realistic Potential...L-10 By Technology...L-10 By Region...L-11 Industrial Sector...L-13 Technical Potential...L-13 By Technology...L-13 By Region...L-14 Realistic Potential...L-15 By Technology...L-15 By Region...L-16 xli

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45 LIST OF FIGURES Figure 3-1 Forecast of Total Primary Energy Consumption by End-Use Sector Figure 3-2 Forecast of Energy-Related CO 2 Emissions by End-Use Sector Figure 3-3 Total Primary Energy Consumption for the Residential Sector - by Region Figure 3-4 Total Primary Energy Consumption for the Commercial Sector - by Region Figure 3-5 Total Primary Energy Consumption for the Industrial Sector - by Region Figure 3-6 Energy-Related CO 2 Emissions for All Sectors - by Region Figure 3-7 Total Primary Energy Consumption for the Residential Sector - by Fuel Figure 3-8 Total Primary Energy Consumption for the Commercial Sector - by Fuel Figure 3-9 Total Primary Energy Consumption for the Industrial Sector - by Fuel Figure 3-10 Energy-Related CO 2 Emissions for All Sectors - by Fuel Figure 3-11 Total Primary Energy Consumption for the Industrial Sector - by Industry Figure 3-12 Energy-Related CO 2 Emissions for the Industrial Sector - by Industry Figure 4-1 Historic and Forecasted Primary Energy Consumption: Combined Impacts of Three Sectors Compared with Baseline Forecast Figure 4-2 Historic and Forecasted Energy-Related CO 2 Emissions: Combined Impacts of Three Sectors Compared with Baseline Forecast Figure 4-3 Illustration of Residential Sector Energy Use Allocation down to the Technology Level Figure 4-4 Illustration of Commercial Sector Energy Use Allocation down to the Technology Level Figure 4-5 Illustration of Industrial Sector Energy Use Allocation down to the Technology Level xliii

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47 LIST OF TABLES Table 2-1 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil-Fueled Technologies in the Residential Sector Table 2-2 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil-Fueled Technologies in the Commercial Sector Table 2-3 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil-Fueled Technologies in the Industrial Sector Table 2-4 Energy Use Characteristics for Efficient Residential Electric End-Use Technologies Table 2-5 Energy Use Characteristics for Residential Fossil-Fueled End- UseTechnologies Table 2-6 Energy Use Characteristics for Efficient Commercial Electric End-Use Technologies Table 2-7 Energy Use Characteristics for Commercial Fossil-Fueled End-Use Technologies Table 2-8 Energy Use Characteristics for Efficient Industrial Electric End-Use Technologies Table 2-9 Energy Use Characteristics for Industrial Fossil-Fueled End-Use Technologies Table 3-1 Forecast of Total Primary Energy Consumption and Energy-Related CO 2 Emissions by End-Use Sector Annual Values Table 4-1 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Sector Table 4-2 Technical Potential: Annual Impacts on Primary Energy Use and CO 2 Emissions by Sector Table 4-3 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Sector Table 4-4 Realistic Potential: Annual Impacts on Primary Energy Use and CO 2 Emissions by Sector Table 4-5 General Characteristics of the Methodology Used for the Residential Sector Table 4-6 Short List of Favorable Residential Electric End-Use Technologies Capable of Yielding Net Reductions in CO 2 Emissions Table 4-7 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Residential Sector) Table 4-8 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Residential Sector) Table 4-9 Technology Characteristics Heat Pump Clothes Dryers Displacing Natural Gas Clothes Dryers xlv

48 Table 4-10 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Clothes Dryers (Residential Sector) Table 4-11 Technology Characteristics Ground-Source Heat Pumps Displacing Coal Space Heating Table 4-12 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Table 4-13 Technology Characteristics - Ground-Source Heat Pumps Displacing Distillate Fuel Oil Space Heating Table 4-14 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Table 4-15 Technology Characteristics Ground-Source Heat Pumps Displacing Kerosene Space Heating Table 4-16 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Table 4-17 Technology Characteristics Ground-Source Heat Pumps Displacing Natural Gas Space Heating Table 4-18 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Table 4-19 Technology Characteristics Ground-Source Heat Pumps Displacing Propane Space Heating Table 4-20 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Table 4-21 Technology Characteristics Heat Pump Water Heaters Displacing Distillate Fuel Oil Water Heating Table 4-22 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Residential Sector) Table 4-23 Technology Characteristics Heat Pump Water Heaters Displacing Natural Gas Water Heating Table 4-24 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Residential Sector) Table 4-25 Technology Characteristics - Heat Pump Water Heaters Displacing Propane Water Heating Table 4-26 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Residential Sector) Table 4-27 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Residential Sector) Table 4-28 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Residential Sector) Table 4-29 General Characteristics of the Methodology Used for the Commercial Sector Table 4-30 Short List of Favorable Commercial Electric End-Use Technologies Capable of Yielding Net Reductions in CO 2 Emissions Table 4-31 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Commercial Sector) xlvi

49 Table 4-32 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Commercial Sector) Table 4-33 Technology Characteristics Ground-Source Heat Pumps Displacing Natural Gas Space Cooling Table 4-34 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps for Space Cooling (Commercial Sector) Table 4-35 Technology Characteristics Ground-Source Heat Pumps Displacing Distillate Fuel Oil Space Heating Table 4-36 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Commercial Sector) Table 4-37 Technology Characteristics Ground-Source Heat Pumps Displacing Natural Gas Space Heating Table 4-38 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Commercial Sector) Table 4-39 Technology Characteristics Ground-Source Heat Pumps Displacing Residual Fuel Oil Space Heating Table 4-40 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Commercial Sector) Table 4-41 Technology Characteristics Ground-Source Heat Pumps Displacing Coal Space Heating Table 4-42 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Commercial Sector) Table 4-43 Technology Characteristics - Heat Pump Water Heaters Displacing Distillate Fuel Oil Water Heating Table 4-44 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Commercial Sector) Table 4-45 Technology Characteristics - Heat Pump Water Heaters Displacing Natural Gas Water Heating Table 4-46 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Commercial Sector) Table 4-47 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Commercial Sector) Table 4-48 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Commercial Sector) Table 4-49 General Characteristics of the Methodology Used for the Industrial Sector Table 4-50 Short List of Favorable Industrial Electric End-Use Technologies Capable of Yielding Net Reductions in CO 2 Emissions Table 4-51 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-use Technology (Industrial Sector) Table 4-52 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Industrial Sector) Table 4-53 Technology Characteristics - Heat Pump Displacing Natural Gas Furnace Table 4-54 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump (Industrial Sector) xlvii

50 Table 4-55 Technology Characteristics Plasma Melting Displacing Natural Gas Furnace Table 4-56 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Plasma Melting (Industrial Sector) Table 4-57 Technology Characteristics Electrolytic Reduction Displacing Natural Gas Furnace Table 4-58 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Electrolytic Reduction (Industrial Sector) Table 4-59 Technology Characteristics Electric Induction Melting Displacing Natural Gas Furnace Table 4-60 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Electric Induction Melting (Industrial Sector) Table 4-61 Technology Characteristics Electric Arc Furnace Displacing Coke Blast Furnace Table 4-62 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Electric Arc Furnace (Industrial Sector) Table 4-63 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-use Technology (Industrial Sector) Table 4-64 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Industrial Sector) xlviii

51 1 INTRODUCTION Background The production and subsequent use of electricity is generally considered a contributing factor to net carbon dioxide (CO 2 ) emissions. Much focus is currently being placed upon the ability of supply-side options such as renewable power generation and carbon-neutral central electric generation technologies to mitigate CO 2 emissions. Exploring the greater potential for CO 2 reductions also warrants a thorough review of demand-side opportunities. Demand-side opportunities include upgrading or enhancing existing electric end-use appliances, devices, buildings, and systems as well as expanding the application of efficient electric end-use technologies to replace fossil-fueled end-use technologies. The focus is here is the latter: expanding end-use applications of electricity. Converting existing and planned equipment and processes from traditional fossil-fueled end-use technologies to more efficient electric end-use technologies has the potential to reduce overall energy use and cut CO 2 emissions significantly, despite losses in the generation and delivery of electricity. Objectives The objective of this study is to assess the potential for efficient electric end-use technologies to save energy and reduce CO 2 emissions within each of the four census regions of the U.S., namely the Northeast, Midwest, South, and West. The focus is on the potential for converting existing and anticipated fossil-fueled technologies to electrified ones in the residential, commercial, and industrial sectors. Project Approach To achieve the stated objectives, the project team divided the study into four main tasks: Task 1: Identify and Characterize Efficient Electric End-Use Technologies The first task involved identifying and characterizing the electric end-use technologies to be analyzed along with the fossil-fueled technologies they would displace. This task consisted of several steps conducted for each end-use sector (residential, commercial, and industrial): Identification of electric end-use technologies with potential to displace fossil-fueled end-use technologies; Identification of the most appropriate end-uses and geographic regions; Identification of the most appropriate industrial subsectors; 1-1

52 Introduction Characterization of the performance of identified electric end-use technologies, including energy use characteristics and benefits over their fossil-fueled counterparts; and Characterization of the performance of identified fossil-fueled equipment, including energy use characteristics and average equipment lifetimes. Task 2: Develop Baseline Forecasts The second task consisted of developing energy and CO 2 baseline forecasts. These forecasts serve as a reference from which to estimate potential energy savings and reductions in CO 2 emissions from demand-side efforts. Data from the Energy Information Administration s Annual Energy Outlook (AEO) 2008 and supplemental tables were used to formulate the baseline forecasts for both energy consumption and CO 2 emissions. 3,4 Specifically, the AEO 2008 s Reference Scenario was used in order to provide consistency with previous EPRI studies. The energy use and CO 2 emissions data were allocated by end-use sector, census region, fuel type, and major industrial subsector. The baseline forecasts span from 2005 to Task 3: Estimate Energy Savings and CO 2 Reduction Potential Task 3 comprised estimating the potential impacts of expanding end-use applications of electricity on overall energy use and CO 2 emissions. Energy and CO 2 impacts were estimated as a function of several parameters for each electric end-use technology: Impacts by end-use sector (residential, commercial, and industrial); Impacts by displaced fuel type (natural gas, coal/coke, fuel oil, etc.); Impacts by census region (Northeast, Midwest, South, and West); and Impacts by year during the study period of 2009 to The analysis was conducted to estimate the phase-in potential. This potential represents the energy savings and CO 2 reductions achieved if only the portion of the current stock of fossilfueled equipment that has reached the end of its useful life and is due for turnover is replaced. Thus, the saturation of efficient electric end-use technologies is assumed to grow each year as more of the existing fossil-fueled equipment is up for replacement. In addition, any new equipment being brought on line in a given year due to market growth is assumed to be displaced by the applicable electric technologies. The focus is on the Technical Potential, which represents the maximum, technically-feasible impacts that would result if the selected electric end-use technologies were to displace fossilfueled technologies. This potential does not take into account cost-effectiveness or customer response, both of which would realistically decrease technology adoption. 3 Annual Energy Outlook 2008 with Projections to 2030, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, 4 Supplemental Tables to the Annual Energy Outlook 2008, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, 1-2

53 Introduction The study also considers a Realistic Potential. It was beyond the scope of the study to do a thorough evaluation of the effects of economics and customer response on the potential, but the project team used professional judgment and industry experience to estimate more realistic potential values. Task 4: Prepare Final Report This document constitutes the results of the last task, which was to prepare a final report summarizing the results of the study in terms of the potential for energy savings and reductions in CO 2 emissions due to expanding end-use applications of electricity in the residential, commercial, and industrial sectors. Note that two sub-teams were formed to carry out the study. It was decided that the EPRI subteam would be responsible for conducting the residential and commercial portions of the study and the Global sub-team would be responsible for the industrial portion. As a result, though the methodologies used for the three sectors are similar, there are some differences due to the nature of the sectors and the procedures followed by the sub-teams. Final Report Structure Chapter 2 identifies the end-use areas and efficient electric technologies analyzed in the study. It also lists the fossil-fueled technologies considered for replacement. It then provides energy use characteristic data for all of the technologies. Some of the merits of the electric technologies relative to fossil-fueled technologies are highlighted. Chapter 3 consists of the energy and CO 2 baseline forecasts used as the reference cases in the study. The forecasts are presented by end-use sector, census region, fuel type, and industrial subsector. Chapter 4 details the results of the study. For each end-use sector considered, the discussion begins by describing the methodology used to determine the technical and realistic potentials. It then continues by presenting the energy and CO 2 impacts as a function of displaced fossil-fuel type, electric end-use technology, and census region. Of all of the electric end-use technologies analyzed, only those found to yield favorable impacts on total energy use and CO 2 emissions are included in the chapter. Chapter 5 summarizes the key findings presented in the report. It also discusses factors that would alter the results, including different baseline scenarios. It concludes by suggesting some next steps to undertake to further assess how expanding end-use applications of electricity can reduce CO 2 emissions. Chapter 6 lists the resources used in conducting the study and compiling the report. The appendices contain detailed results and supporting data. 1-3

54

55 2 EFFICIENT ELECTRIC END-USE TECHNOLOGIES This chapter identifies the end-use areas and efficient electric technologies analyzed in the study by end-use sector. It also lists the fossil-fueled technologies considered for replacement. It then provides energy use characteristic data for all of the technologies. Some of the merits of the electric technologies relative to fossil-fueled technologies are highlighted. Analyzed Electric End-Use Technologies Table 2-1 through Table 2-3 summarize the electric end-use technologies analyzed in the study as well as the fossil-fueled technologies they are assumed to replace. The technologies are categorized by sector and applicable end-use area. As the tables show, the project team analyzed a total of eight residential, twenty commercial, and twelve industrial electric technologies. Table 2-1 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil- Fueled Technologies in the Residential Sector Efficient Electric End-Use Technology Clothes Drying General Fossil Fuel Technology Category Specific Fossil-Fueled Technology Heat Pump Clothes Dryer - Natural Gas Clothes Dryer Cooking Electric Oven - Natural Gas Oven Inductive Range Top - Natural Gas Range Top Pool/Spa Heating Heat Pump Pool/Spa Heater Fossil-Fueled Pool/Spa Heating Distillate Fuel Oil Pool Heater Natural Gas Pool Heater Propane/LPG Pool Heater Space Cooling Air-Source Heat Pump Natural Gas Space Cooling Natural Gas Heat Pump Ground-Source Heat Pump Natural Gas Space Cooling Natural Gas Heat Pump Space Heating Air-Source Heat Pump Coal Space Heating Coal Heating Stove Distillate Fuel Oil Space Heating Distillate Fuel Oil Boiler 2-1

56 Efficient Electric End-Use Technologies Efficient Electric End-Use Technology General Fossil Fuel Technology Category Specific Fossil-Fueled Technology Distillate Fuel Oil Furnace Kerosene Space Heating Kerosene Furnace Kerosene Portable Heater Natural Gas Space Heating Natural Gas Boiler Natural Gas Furnace Natural Gas Heat Pump Natural Gas Vented Direct Heating Propane/LPG Space Heating Propane/LPG Boiler Propane/LPG Furnace Propane/LPG Vented Direct Heating Ground-Source Heat Pump Same as air-source heat pump - Water Heating Electric Instantaneous Water Heater Distillate Fuel Oil Water Heating Natural Gas Water Heating Propane/LPG Water Heating Distillate Fuel Oil Storage Natural Gas Instantaneous Natural Gas Storage Propane/LPG Instantaneous Propane/LPG Storage Heat Pump Water Heater Same as electric instantaneous - 2-2

57 Efficient Electric End-Use Technologies Table 2-2 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil- Fueled Technologies in the Commercial Sector Efficient Electric End-Use Technology Clothes Drying General Fossil Fuel Technology Category Specific Fossil-Fueled Technology Heat Pump Clothes Dryer - Natural Gas Clothes Dryer Cooking Electric Braising Pan - Natural Gas Braising Pan Electric Broiler - Natural Gas Broiler Electric Griddle - Natural Gas Griddle Electric Fryer, Flat Bottom - Natural Gas Fryer, Flat Bottom Electric Fryer, Open Deep Fat Electric Fryer, Pressure/Kettle - Natural Gas Fryer, Open Deep Fat - Natural Gas Fryer, Pressure/Kettle Electric Oven, Conveyor - Natural Gas Oven, Conveyor Electric Oven, Deck - Natural Gas Oven, Deck Electric Oven, Rotisserie - Natural Gas Oven, Rotisserie Electric Oven, Standard/Convection - Natural Gas Oven, Standard/Convection Electric Range Top - Natural Gas Range Top Electric Steamer, Compartment - Natural Gas Steamer, Compartment Electric Steamer, Kettle - Natural Gas Steamer, Kettle Electric Wok - Natural Gas Wok Pool/Spa Heating Heat Pump Pool/Spa Heater Fossil-Fueled Pool/Spa Heating Distillate Fuel Oil Pool Heater Natural Gas Pool Heater Space Cooling Air-Source Heat Pump Natural Gas Space Cooling - Ground-Source Heat Pump Natural Gas Space Cooling - Space Heating Electric Boiler Fossil-Fueled Boilers Distillate Fuel Oil Boiler 2-3

58 Efficient Electric End-Use Technologies Efficient Electric End-Use Technology General Fossil Fuel Technology Category Specific Fossil-Fueled Technology Natural Gas Boiler Residual Fuel Oil Boiler Air-Source Heat Pump Distillate Fuel Oil Space Heating Distillate Fuel Oil Boiler Distillate Fuel Oil Furnace Natural Gas Space Heating Natural Gas Boiler Natural Gas Furnace Natural Gas Vented Direct Heating Residual Fuel Oil Space Heating Residual Fuel Oil Boiler Ground-Source Heat Pump Same as air-source heat pump Water Heating Heat Pump Water Heater Fuel Oil Water Heating Distillate Fuel Oil Storage Natural Gas Water Heating Natural Gas Instantaneous Natural Gas Storage 2-4

59 Efficient Electric End-Use Technologies Table 2-3 Efficient Electric End-Use Technologies Analyzed for Potential Displacement of Fossil- Fueled Technologies in the Industrial Sector End-Use Area Industrial Sector (Manufacturing Industries) Efficient Electric End-Use Technology Displaced Fossil-Fueled Technology Boilers Electric Boiler Natural Gas Boiler Fuel Oil Boiler Coal-Fired Boiler Electric Drive Natural Gas Boiler Fuel Oil Boiler Coal-Fired Boiler Space Heating Heat Pump Natural Gas Furnace Process Heating Heat Pump Natural Gas Furnace Induction Heating Radio Frequency Heating Microwave Heating Electric Infrared Heating UV Heating Electric Arc Furnace Electric Induction Melting Plasma Melting Electrolytic Reduction Direct-Fired Natural Gas Direct-Fired Natural Gas Direct-Fired Natural Gas Direct-Fired Natural Gas Direct-Fired Natural Gas Coke Blast Furnace Natural Gas Furnace Natural Gas Furnace Natural Gas Furnace The following subsections describe the energy use characteristics of the technologies considered for each sector evaluated in the study. Some additional merits of the electric technologies beyond energy efficiency are also presented. Residential Sector Eight efficient electric technologies were analyzed to find whether they have the potential for expanding end-use applications of electricity in the residential sector. Two additional electric technologies were initially included in the study but were left out due to insufficient data. The following bullet points describe the technologies that were considered but not included in the residential sector analyses: 2-5

60 Efficient Electric End-Use Technologies Heat Pump Dehumidification: Limited data exists regarding energy consumption and efficiency of heat pumps for dehumidification. In addition, heat pumps would displace natural gas consumed for desiccant dehumidification systems, and there is also a lack of data regarding the end-use consumption and dehumidification efficiency of desiccant dehumidifiers. Laundry Water Ozonation: Limited data regarding energy consumption of laundry water ozonation was found in product literature. Also, though anecdotal evidence suggests that this technology has the potential to reduce hot water needs by up to a third, with the corresponding increase in electricity consumption and associated CO 2 emissions the effects of including this technology in the study would be only marginal. Energy Use Characteristics Table 2-4 summarizes the energy use characteristics of the eight electric technologies considered for expanding end-use applications of electricity in the residential sector. In order to estimate the technical potential for emissions reductions, the efficiencies of electric technologies in Table 2-4 represent the highest efficiency units commercially available today, except in the case of heat pump clothes dryers. Certified product directories were used where available to find the highest efficiencies for space heating, space cooling, and water heating technologies. 5,6 Heat pump clothes dryers are not generally available in the U.S. and there is a lack of data regarding their efficiency; therefore, the value listed in Table 2-4 is from a DOE Technical Support Document and represents a prototype developed by a company in the U.S. 7 To find the highest efficiency heat pump pool/spa heaters, heat pump water heaters, and cooking technologies, literature on commercially available products and those under development was surveyed. Table 2-5 summarizes the energy use characteristics of the fossil-fueled technologies that may be replaced. The space heating, space cooling, and water heating efficiencies in Table 2-5 are based primarily on stock efficiency values for For technologies with similar efficiencies in commercially available products, the same stock efficiency values were used. For example, propane furnaces and boilers have similar efficiencies as natural gas furnaces and boilers and, therefore, the same efficiency was used for both. The weighted average of the efficiencies of the main technologies was calculated based on the number of units in the U.S. in Directory of Certified Product Performance, Air-Conditioning, Heating and Refrigeration Institute, Boston, MA: 2008, 6 GAMA and I=B=R Efficiency Rating Certified product directories, Air-Conditioning, Heating and Refrigeration Institute, Arlington, VA: 2008, 7 Technical Support Document: Energy Conservation Standards for Consumer Products: Dishwashers, Clothes Washers, and Clothes Dryers, U.S. Department of Energy, Washington DC: December 1990, 8 Supplemental Tables to the Annual Energy Outlook 2008, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Table

61 Efficient Electric End-Use Technologies Table 2-4 Energy Use Characteristics for Efficient Residential Electric End-Use Technologies Characterization of Efficient Electric End-Use Technologies for the Residential Sector Technology End-Use Efficiency Units Heat Pump Clothes Dryer 8.61 lbs/kwh Electric Convection Oven BTU to food/btu Electric Induction Range Top 0.85 BTU to food/btu Heat Pump Pool/Spa Heater 5.92 COP Air-Source Heat Pump, Cooling 21 SEER Air-Source Heat Pump, Heating 11 HSPF Ground-Source Heat Pump, Cooling 30.1 EER Ground-Source Heat Pump, Heating 5.3 COP Electric Instantaneous Water Heater 0.99 EF Heat Pump Water Heater 3.4 COP Note: The efficiency of clothes dryers is expressed as pounds of laundry dried per kilowatt-hour of input energy. Sources: Heat pump water heater: AERS, 2008; Heat pumps: AHRI, 2008a; Electric instantaneous water heater: AHRI, 2008b; Heat pump clothes dryer: DOE, 1990; Oven: DOE, 2007; Range top: FSTC, 2002; and Heat pump pool/spa heater: Jandy,

62 Efficient Electric End-Use Technologies Table 2-5 Energy Use Characteristics for Residential Fossil-Fueled End-UseTechnologies Characterization of Fossil-Fueled End-Use Technologies for the Residential Sector Electric End-Use Technology for Replacement Displaced Fossil-Fueled Technology End-Use Efficiency Units Heat Pump Clothes Dryers Natural Gas Clothes Dryers 2.35 lbs/kwh Electric Convection Oven Natural Gas Oven 0.07 BTU to food/btu Electric Induction Range Top Natural Gas Range Top 0.41 BTU to food/btu Heat Pump Pool/Spa Heater Distillate Fuel Oil Pool/Spa Heater 0.79 BTU/BTU Gas Pool/Spa Heater 0.82 BTU/BTU Air- or Ground-Source Heat Pump, Cooling Natural Gas Heat Pump 0.67 GCOP Air- or Ground-Source Heat Pump, Heating Coal Space Heating 0.53 BTU/BTU Distillate Fuel Oil Space Heating 0.83 AFUE Kerosene Space Heating 0.87 BTU/BTU Natural Gas Space Heating 0.83 AFUE Propane/LPG Space Heating 0.83 AFUE Electric Instantaneous or Heat Pump Water Heater Distillate Fuel Oil Water Heating 0.57 EF Natural Gas Water Heating 0.59 EF Propane/LPG Water Heating 0.62 EF Notes: 1) The efficiency of clothes dryers is expressed as pounds of laundry dried per equivalent kilowatt-hour of input energy, where 1 kwh = 3,412 BTU. 2) Where not specified, gas refers to natural gas or propane/lpg. Sources: Clothes dryer based on DOE, 1990, EIA 2008a, EIA, 2008b; Mid-range cooking efficiency for ovens and range tops: DOE, 2007; Heating and cooling and water heating technologies: EIA, 2008b; Pool heater, average over products reported in FTC, 2008; and estimated coal space heating efficiency based on typical values. 2-8

63 Efficient Electric End-Use Technologies The efficiency of natural gas clothes dryers was calculated using EIA AEO 2008 forecast data for consumption of natural gas for clothes drying, along with the total number of units in the U.S. 8,9 The stock efficiency for 2009 was obtained based on a typical usage of 359 cycles a year with a standard load of 7 lbs. 7 The units used to describe the efficiency of each of the technologies are common efficiency metrics that describe the amount of useful output per unit of energy input. For the purposes of the technical potential study, all efficiencies were assumed to be constant over the forecast period, which resulted in a constant energy efficiency ratio for each pair of electric and fossil-fueled technologies. See Appendix A for a listing of the energy efficiency ratios used in the technical potential analysis. Merits of Electric End-Use Technologies Beyond Energy Efficiency There are several benefits to the increased use of electric technologies in the residential sector aside from the energy and CO 2 savings that they offer. A few of the specific merits of the electric end-use technologies selected for analysis relative to their fossil-fueled counterparts include the following: Urban Emissions Reduction: Emissions from direct combustion of fossil fuels are moved from homes to central generation sites, which tend to be located farther from city centers. Heat Pumps Leverage Ambient Heat: Therefore, in many heating applications, the primary energy source is the sun, which is a renewable and local energy source. Dehumidification: Heat pump water heaters cool and dehumidify the surrounding air when operating. Manufacturing Development: Wider adoption of heat pump technologies in the U.S. will present the opportunity for manufacturing development in the U.S. and consequently job creation in the green manufacturing sector. One unique characteristic of electricity is that it is the only fuel source that can decrease its CO 2 intensity. On one hand this is due to the ability to change the fuel mix of generation, i.e. increased penetration of nuclear and renewable generation sources. On the other hand, there is increased research and development relating to technologies to reduce the amount of CO 2 entering the atmosphere at fossil-fueled generation sites, i.e. carbon capture and storage. In contrast, direct combustion of fossil fuels will always produce the same amount of CO 2, with only small variations based on fuel composition. 9 Annual Energy Outlook 2008 with Projections to 2030, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Table

64 Efficient Electric End-Use Technologies Commercial Sector Twenty efficient electric technologies were analyzed to find whether they have the potential for expanding end-use applications of electricity in the commercial sector. Three additional electric technologies and two additional fossil fuels were initially included in the study but were left out due to insufficient data. The following bullet points describe the technologies that were considered but not included in the commercial sector analyses: Water Loop Heat Pumps: Water loop heat pumps are water-to-air heat pumps in which the temperature of the heat source, the water loop, is controlled in a narrow range using a boiler/tower system instead of a ground- or water-source loop. For the purposes of this study, a water loop heat pump does not qualify as a replacement for fossil-fueled technologies since it requires an external heat source. Instead, electric boilers are considered and may replace fossil-fueled boilers used in water loop systems. Heat Pump Dehumidification: Limited data exists regarding energy consumption and efficiency of heat pumps for dehumidification. In addition, heat pumps would displace natural gas consumed for desiccant dehumidification systems, and there is also a lack of data regarding the end-use consumption and dehumidification efficiency of desiccant dehumidifiers. Laundry Water Ozonation: Limited data regarding energy consumption of laundry water ozonation was found in product literature. Also, though anecdotal evidence suggests that this technology has the potential to reduce hot water needs by up to a third, with the corresponding increase in electricity consumption and associated CO 2 emissions the effects of including this technology in the study would be only marginal. LPG Space Heating and Water Heating: There is a lack of data regarding the breakout of LPG among end-use categories in the commercial sector. Consumption of LPG in the commercial sector is forecast to be about 2% of total fossil fuel consumption out to 2030; therefore, the effects of displacing LPG consumption would be only marginal. Kerosene Space Heating: There is a lack of data regarding the consumption of kerosene for space heating in the commercial sector. Consumption of kerosene for all end-uses in the commercial sector is forecast to be less than a half of a percent of total fossil fuel consumption out to 2030; therefore, the effects of displacing kerosene consumption would also be only marginal. Energy Use Characteristics Table 2-6 summarizes the energy use characteristics of the twenty electric technologies considered for expanding end-use applications of electricity in the commercial sector. In order to estimate the technical potential for emissions reductions, the efficiencies of electric technologies in Table 2-6 represent the highest efficiency units commercially available today, except in the case of heat pump clothes dryers. Certified product directories were used where available to find 2-10

65 Efficient Electric End-Use Technologies the highest efficiencies for the space heating and cooling technologies. 10 The efficiency of heat pump clothes dryers and heat pump pool/spa heaters are the same as those used in the residential sector. To find the highest efficiency heat pump water heater, literature on commercially available products and those under development was surveyed. Table 2-7 summarizes the energy use characteristics of the fossil-fueled technologies that may be replaced. The space heating, space cooling, and water heating efficiencies in Table 2-7 are stock efficiency values for 2009 and incorporate the effects of equipment turnover. 11 The efficiencies of natural gas clothes dryers and coal space heating are the same values used for the residential sector. The units used to describe the efficiency of each of the technologies are common efficiency metrics that describe the amount of useful output per unit of energy input. For the purposes of the technical potential study, all efficiencies were assumed to be constant over the forecast period, which resulted in a constant energy efficiency ratio for each pair of electric and fossil-fueled technologies. See Appendix A for a listing of the energy efficiency ratios used in the technical potential analysis. Merits of Electric End-Use Technologies Beyond Energy Efficiency There are several benefits to the increased use of electric technologies in the commercial sector aside from the energy and CO 2 savings that they offer. A few of the specific merits of the electric technologies selected for analysis relative to their fossil-fueled counterparts include the following: Urban Emissions Reduction: Emissions from direct combustion of fossil fuels are moved from homes to central generation sites, which tend to be located farther from city centers. Heat Pumps Leverage Ambient Heat: Therefore, in many heating applications, the primary energy source is the sun, which is a renewable and local energy source. Dehumidification: Heat pump water heaters cool and dehumidify the surrounding air when operating. Manufacturing Development: Wider adoption of heat pump technologies in the U.S. will present the opportunity for manufacturing development in the U.S. and consequently job creation in the green manufacturing sector. One unique characteristic of electricity is that it is the only fuel source that can decrease its CO 2 intensity. On one hand this is due to the ability to change the fuel mix of generation, i.e. increased penetration of nuclear and renewable generation sources. On the other hand, there is increased research and development relating to technologies to reduce the amount of CO 2 entering the atmosphere at fossil-fueled generation sites, i.e. carbon capture and storage. In contrast, direct combustion of fossil fuels will always produce the same amount of CO 2, with only small variations based on fuel composition. 10 Directory of Certified Product Performance, Air-Conditioning, Heating and Refrigeration Institute, Boston, MA: 2008, 11 Supplemental Tables to the Annual Energy Outlook 2008, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Table

66 Efficient Electric End-Use Technologies Table 2-6 Energy Use Characteristics for Efficient Commercial Electric End-Use Technologies Characterization of Efficient Electric End-Use Technologies for the Commercial Sector Technology End-Use Efficiency Units Heat Pump Clothes Dryers 8.61 lbs/kwh Electric Braising Pan 0.95 BTU to food/btu Electric Broiler 0.65 BTU to food/btu Electric Griddle 0.75 BTU to food/btu Electric Fryer, Flat Bottom 0.85 BTU to food/btu Electric Fryer, Open Deep Fat 0.87 BTU to food/btu Electric Fryer, Pressure/Kettle 0.85 BTU to food/btu Electric Oven, Conveyor 0.40 BTU to food/btu Electric Oven, Deck 0.60 BTU to food/btu Electric Oven, Rotisserie 0.60 BTU to food/btu Electric Oven, Standard/Convection/Combination 0.80 BTU to food/btu Electric Range Top 0.85 BTU to food/btu Electric Steamer, Compartment 0.80 BTU to food/btu Electric Steamer, Kettle 0.95 BTU to food/btu Electric Wok 0.70 BTU to food/btu Heat Pump Pool/Spa Heater 5.92 COP Electric Boilers 0.98 BTU/BTU Air-Source Heat Pump, Cooling 21 SEER Air-Source Heat Pump, Heating 11 HSPF 2-12

67 Efficient Electric End-Use Technologies Characterization of Efficient Electric End-Use Technologies for the Commercial Sector Technology End-Use Efficiency Units Ground-Source Heat Pump, Cooling 30.1 EER Ground -Source Heat Pump, Heating 5.3 COP Heat Pump Water Heater 3.4 COP Note: The efficiency of clothes dryers is expressed as pounds of laundry dried per kilowatt-hour of input energy. Sources: Heat pump water heater: AERS, 2005; Heat pumps: AHRI, 2008a; Electric Boilers: AHRI, 2008b; Heat pump clothes dryer: DOE, 1990; Open deep fat fryer: EPA, 2008; All other cooking equipment: FSTC, 2002; and Heat pump pool/spa heater: Jandy,

68 Efficient Electric End-Use Technologies Table 2-7 Energy Use Characteristics for Commercial Fossil-Fueled End-Use Technologies Characterization of Fossil-Fueled End-Use Technologies for the Commercial Sector Electric End-Use Technology for Replacement Displaced Fossil-Fueled Technology End-Use Efficiency Units Heat Pump Clothes Dryers Natural Gas Clothes Dryers 2.35 lbs/btu Electric Braising Pan Natural Gas Braising Pan 0.43 BTU to food/btu in Electric Broiler Natural Gas Broiler 0.23 BTU to food/btu in Electric Griddle Natural Gas Griddle 0.38 BTU to food/btu in Electric Fryer, Flat Bottom Natural Gas Fryer, Flat Bottom 0.38 BTU to food/btu in Electric Fryer, Open Deep Fat Natural Gas Fryer, Open Deep Fat 0.45 BTU to food/btu in Electric Fryer, Pressure/Kettle Natural Gas Fryer, Pressure/Kettle 0.38 BTU to food/btu in Electric Oven, Conveyor Natural Gas Oven, Conveyor 0.15 BTU to food/btu in Electric Oven, Deck Natural Gas Oven, Deck 0.25 BTU to food/btu in Electric Oven, Rotisserie Natural Gas Oven, Rotisserie 0.25 BTU to food/btu in Electric Oven, Standard/Convection/Combination Natural Gas Oven, Standard/Convection/Combination 0.40 BTU to food/btu in Electric Range Top Natural Gas Range Top 0.43 BTU to food/btu in Electric Steamer, Compartment Natural Gas Steamer, Compartment 0.35 BTU to food/btu in Electric Steamer, Kettle Natural Gas Steamer, Kettle 0.50 BTU to food/btu in Electric Wok Natural Gas Wok 0.23 BTU to food/btu in Heat Pump Pool/Spa Heater Distillate Fuel Oil Pool/Spa Heater 0.79 BTU/BTU Gas Pool/Spa Heater, Natural Gas and LPG 0.82 BTU/BTU 2-14

69 Efficient Electric End-Use Technologies Characterization of Fossil-Fueled End-Use Technologies for the Commercial Sector Electric End-Use Technology for Replacement Displaced Fossil-Fueled Technology End-Use Efficiency Units Heat Pump, Cooling Natural Gas Space Cooling 0.85 BTU/BTU Electric Boilers and Heat Pumps Distillate Fuel Oil Space Heating 0.78 BTU/BTU Natural Gas Space Heating 0.75 BTU/BTU Residual Fuel Oil Space Heating 0.78 BTU/BTU Coal Space Heating 0.53 BTU/BTU Heat Pump Water Heater Distillate Fuel Oil Water Heating 0.78 BTU/BTU Natural Gas Water Heating 0.82 BTU/BTU Notes: 1) The efficiency of clothes dryers is expressed as pounds of laundry dried per equivalent kilowatt-hour of input energy, where 1 kwh = 3,412 BTU. 2) Where not specified, gas refers to natural gas or propane/lpg. Sources: Clothes dryer based on DOE, 1990, EIA 2008a, EIA 2008b; Efficiencies of cooking equipment are average of max and min cooking-energy efficiencies from Table 1-2, FSTC, 2002; Pool heater, average over products reported in FTC, 2008; Heating and cooling, and water heating efficiencies are 2009 stock efficiencies from EIA, 2008b; and estimated coal space heating efficiency based on typical values 2-15

70 Efficient Electric End-Use Technologies Industrial Sector Energy Use Characteristics Table 2-8 summarizes the energy use characteristics of the industrial electric technologies identified for replacing fossil-fueled technologies in the analysis. Depending on data availability for a given technology, the energy use characteristics are provided in the form of either an enduse energy consumption per unit of production value or an efficiency percentage. The values were obtained from earlier EPRI research as well as from industry experience with the technologies. Note that several of the electric process heating technologies have been given equivalent efficiency values of 74%. It is unlikely that each of these technologies has exactly the same level of efficiency; however, in practice, the project team has observed that 74% is a typical level of efficiency for these types of technologies. Table 2-9 summarizes the energy use characteristics of the industrial fossil-fueled technologies proposed for displacement by electric technologies. Again, depending on data availability for a given technology, the energy use characteristics are provided in the form of either an end-use energy consumption per unit of production value or an efficiency percentage. These values were also obtained from earlier EPRI research as well as from industry experience with the technologies. The values listed in both Table 2-8 and Table 2-9 reflect energy use characteristics of technology options that are currently commercially available. It is possible that advances will occur between now and 2030 that will improve the efficiency of the technologies. For the purposes of this study, we assume that any efficiency advances in electric end-use technologies are equally offset by efficiency advances in the fossil-fueled technologies they replace. Thus, the energy efficiency ratios of the fossil-fueled technologies to the electric technologies are assumed to remain constant throughout the study period. See Appendix A for a listing of the energy efficiency ratios used in subsequent analyses. Merits of Electric End-Use Technologies Beyond Energy Efficiency Beyond energy efficiency, electric end-use technologies have some unique advantages over fossil-fueled technologies in industrial processes. For one, electricity is an orderly energy form, in contrast to thermal energy, which is random. This orderliness means that electrical processes are controllable to a much more precise degree than thermal processes. In addition, since electricity has no inertia, energy input can instantly adjust to varying process conditions such as material temperature, moisture content, or chemical composition. For instance, lasers and electron beams can produce energy densities at the work surface that are a million times more intense than an oxyacetylene torch. 12 Their focal points can be rapidly scanned with computercontrolled mirrors or magnetic fields to deposit energy exactly where needed. This focusing can be a tremendous advantage in, for example, heating of parts precisely at points of maximum wear, thereby eliminating the need to heat and cool the entire piece. As such, electricity can 12 Clark W. Gellings, Saving Energy with Electricity, Discussion Paper, EPRI, Palo Alto, CA:

71 Efficient Electric End-Use Technologies deliver packages of concentrated, precisely-controlled energy and information efficiently to virtually any point. It offers society greater form value than other forms of energy since it is such a high quality energy form. Form value affords flexibility, which in turn allows technical innovation and enormous potential for economic efficiency and growth. A few of the specific merits of the efficient electric end-use technologies selected for analysis relative to their fossil-fueled counterparts include the following: Electric Boilers: Smaller footprint; quicker response to load changes. Electric Drives: Lower maintenance and operating cost; reduced cooling water use; improved process control. Heat Pumps: Reduced waste heat; lowered effluent temperature; improved process control; improved product quality. Electric Technologies for Process Heating: Reduced operating and maintenance costs; improved process control; improved product quality. 2-17

72 Efficient Electric End-Use Technologies Table 2-8 Energy Use Characteristics for Efficient Industrial Electric End-Use Technologies Characterization of Efficient Electric End-Use Technologies for the Industrial Sector Technology End-Use Energy Consumption per Unit of Production Units End-Use Efficiency (%) Notes on Derivation Electric Boilers Electric 100% Efficiency Electric Drives BTU/BTU - Electric drives use as much energy as steam drives Heat Pumps kwh/mbtu - 1 MBTU requires kwh (COP=7) Induction Heating Induction/impulse 74% efficiency Radio Frequency Heating Radio frequency 74% efficiency Microwave Heating Microwave 74% efficiency Electric Infrared Heating Infrared 74% efficiency UV Heating UV 74% efficiency Electric Arc Furnace 500 kwh/ton - Electric arc melting = 500 kwh/ton steel Electric Induction Melting 488 BTU/pound - Induction heating energy/pound steel = 488 BTU Plasma Melting Plasma 70% efficiency Electrolytic Reduction Million BTU/ton - Electrolytic reduction = MMBTU/lb aluminum Sources: EPRI, 1991; EPRI, 1996; and industry experience. 2-18

73 Efficient Electric End-Use Technologies Table 2-9 Energy Use Characteristics for Industrial Fossil-Fueled End-Use Technologies Characterization of Fossil-Fueled End-Use Technologies for the Industrial Sector Electric End-Use Technology for Replacement Displaced Fossil Fueled Technology End-Use Energy Consumption per Unit of Production Units End-Use Efficiency (%) Notes on Derivation Electric Boilers Electric Drives Natural Gas, Coal, and Fuel Oil Boilers Natural Gas, Coal, and Fuel Oil Boilers Fossil-fueled 80% Efficiency 1 BTU/BTU - Electric drives use as much energy as steam drives Heat Pumps Natural Gas Furnace 1 BTU/BTU - Induction Heating Direct Fired Natural Gas Natural 35% efficiency Radio Frequency Heating Direct Fired Natural Gas Natural 35% efficiency Microwave Heating Direct Fired Natural Gas Natural 35% efficiency Electric Infrared Heating Direct Fired Natural Gas Natural 35% efficiency UV Heating Direct Fired Natural Gas Natural 35% efficiency Electric Arc Furnace Coke Blast Furnace 15.6 Million BTU/ton - Blast furnace melting = 0.6 tons coke/ton steel x 2000 lb/ton x 13,000 BTU/lb = 15.6 MMBTU/ton Electric Induction Melting Natural Gas Furnace 1707 BTU/lb - Natural gas furnace heating energy/pound steel = 1707 Btu Plasma Melting Natural Gas Furnace % efficiency Electrolytic Reduction Natural Gas Furnace 175 Million BTU/ton - Conventional furnace = 175 MMBtu/ton Sources: EPRI, 1991; EPRI, 1996; and industry experience. 2-19

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75 3 ENERGY AND CO 2 BASELINE FORECASTS This chapter describes the annual energy and CO 2 baseline forecasts used as the reference cases in the study. The data are derived from the EIA AEO The forecasts are presented by enduse sector, census region, fuel type, and industrial subsector. Note that for all energy data in this chapter, primary energy used by the electricity sector has been allocated to each end-use sector. Therefore, for each sector, the data include all delivered energy as well as electricity-related losses. In addition, the CO 2 data reflect energy-related CO 2 emissions only. Sector Data Table 3-1 summarizes the baseline forecast data used in this study by end-use sector. The current works focuses on the residential, commercial, and industrial sectors, but transportation data have been included as well for completeness. The table lists the total annual energy consumption values and energy-related CO 2 emissions in five-year increments between 2005 and Table 3-1 Forecast of Total Primary Energy Consumption and Energy-Related CO 2 Emissions by End-Use Sector Annual Values Total Primary Energy Consumption by Sector (Quadrillion BTUs per Year) Energy-Related CO 2 Emissions by Sector (Million Metric Tons per Year) Sector Residential ,254 1,259 1,280 1,323 1,379 1,450 Commercial ,065 1,080 1,176 1,265 1,367 1,474 Industrial ,677 1,693 1,718 1,718 1,716 1,733 Transportation ,985 1,980 2,052 2,077 2,110 2,193 Total ,981 6,012 6,226 6,383 6,572 6,850 Sources: 1. EIA, 2008a. Table EIA, 2008b. Table 10. Figure 3-1 and Figure 3-2 graphically depict the baseline forecasts of energy use and CO 2 emissions, respectively. 3-1

76 Energy and CO2 Baseline Forecasts Total Primary Energy Consumption - By Sector Quadrillion BTU Transportation Industrial Commercial Residential Figure 3-1 Forecast of Total Primary Energy Consumption by End-Use Sector Source: EIA, 2008b. Table

77 Energy and CO2 Baseline Forecasts Energy-Related CO 2 Emissions - By Sector Million Metric Tons. 8,000 7,000 6,000 5,000 4,000 3,000 2,000 Transportation Industrial Commercial 1,000 Residential Figure 3-2 Forecast of Energy-Related CO 2 Emissions by End-Use Sector Source: EIA, 2008a. Table 18. As Table 3-1 and Figure 3-1 show, the industrial sector is currently the largest energy user followed by the transportation, residential, and then commercial sectors. By 2030, the industrial sector is still forecasted to be the largest consumer (35.0 quadrillion BTUs per year), but the transportation sector is very close in second place (33.0 quadrillion BTUs per year). In addition, the residential and commercial sectors are projected to be tied for third place (25.0 quadrillion BTUs per year). Overall, total energy consumption is expected to increase by 18% between 2005 and In terms of CO 2 emissions, the Table 3-1 and Figure 3-2 show that the transportation sector is currently the largest producer of emissions followed by the industrial, residential, and then commercial sectors. By 2030, the transportation sector is still forecasted to be the largest emitter (2,193 million metric tons per year), with the industrial sector in second place (1,733 million metric tons per year). However, the commercial sector (1,474 million metric tons per year) is expected to outpace the residential sector (1,450 million metric tons per year) by

78 Energy and CO2 Baseline Forecasts Regional Data Figure 3-3, Figure 3-4, and Figure 3-5 illustrate the regional breakdowns of baseline energy consumption data for the residential, commercial, and industrial sectors, respectively. For the residential sector, the South is currently the largest energy user. The Midwest, Northeast, and then West census regions follow. In 2030, the South is still projected to be the largest consumer (10.2 quadrillion BTUs per year), followed by the Midwest in second place (6.0 quadrillion BTUs per year). However, by this time, the West (4.8 quadrillion BTUs per year) is expected to exceed the Northeast s consumption (3.9 quadrillion BTUs per year). Overall, residential energy consumption is forecasted to increase by 16% between 2005 and In the commercial sector, the regional ordering of energy consumption is similar. As with the residential sector, the South is presently the largest consumer followed by the Midwest, Northeast, and then South. By 2030, the South (9.5 quadrillion BTUs per year) still leads the way followed by the Midwest (5.9 quadrillion BTUs per year), but the West (5.1 quadrillion BTUs per year) passes up the Northeast (4.2 quadrillion BTUs per year). Overall, energy consumption in the commercial sector is forecasted to increase by a dramatic 40% between 2005 and The story for the industrial sector is much the same, with the South being the dominant player followed by the Midwest, West, and Northeast throughout the study period. Overall, industrial energy use is expected to rise by a modest 7% between 2005 and Total Energy Consumption - Residential Quadrillion BTU West South Midwest 0.00 Northeast Figure 3-3 Total Primary Energy Consumption for the Residential Sector - by Region Source: EIA, 2008b. Tables

79 Energy and CO2 Baseline Forecasts Total Energy Consumption - Commercial Quadrillion BTU West South Midwest 0.00 Northeast Figure 3-4 Total Primary Energy Consumption for the Commercial Sector - by Region Source: EIA, 2008b. Tables 1-9. Total Energy Consumption - Industrial Quadrillion BTU West South Midwest 0.00 Northeast Figure 3-5 Total Primary Energy Consumption for the Industrial Sector - by Region Source: EIA, 2008b. Tables

80 Energy and CO2 Baseline Forecasts Figure 3-6 depicts the regional baseline forecast of energy-related CO 2 emissions between 2005 and The data include emissions for all sectors combined (residential, commercial, industrial, and transportation). Throughout the time period evaluated, the South is the major emitter (2,947 million metric tons in 2030), followed by the Midwest (1,677 million metric tons in 2030), the West (1,406 million metric tons in 2030), and then the Northeast (820 million metric tons in 2030). Overall, CO 2 emissions are expected to increase by 15% between 2005 and Energy-Related CO 2 Emissions - By Region 8,000 7,000 Million Metric Tons. 6,000 West 5,000 4,000 South 3,000 2,000 Midwest 1,000 Northeast Figure 3-6 Energy-Related CO 2 Emissions for All Sectors - by Region Source: EIA, 2008b. Tables

81 Energy and CO2 Baseline Forecasts Fuel Data Figure 3-7, Figure 3-8, and Figure 3-9 illustrate baseline energy consumption by fuel type for the residential, commercial, and industrial sectors, respectively. For all sectors, electricity and related losses constitute the major portion of total energy use. For the residential sector, natural gas is the next most significant source of delivered energy, followed by distillate fuel oil, liquefied petroleum gases, renewable energy, kerosene, and then coal. For the commercial sector, natural gas is also the next major source of energy after electricity, followed by distillate fuel oil. Other fuels are present, but consumed in a much smaller degree. In the industrial sector, liquid fuels and other petroleum as well as natural gas rival electricity coupled with electricity-related losses in total energy consumption. Coal, renewables, and biofuels are also significant energy sources for industry. Total Energy Consumption - Residential Quadrillion BTU Coal Kerosene Renewable Energy Liquefied Petroleum Gases Distillate Fuel Oil Natural Gas Electricity Electricity Related Losses Figure 3-7 Total Primary Energy Consumption for the Residential Sector - by Fuel Source: EIA, 2008b. Table

82 Energy and CO2 Baseline Forecasts Total Energy Consumption - Commercial Quadrillion BTU Kerosene Motor Gasoline Coal Liquefied Petroleum Gases Residual Fuel Oil Renewable Energy Distillate Fuel Oil Natural Gas Electricity Electricity Related Losses Figure 3-8 Total Primary Energy Consumption for the Commercial Sector - by Fuel Source: EIA, 2008b. Table 10. Total Energy Consumption - Industrial Quadrillion BTU Biofuels Heat and Coproducts Renewable Energy Coal Electricity Electricity Related Losses Natural Gas Liquid Fuels and Other Petroleum 3-8 Figure 3-9 Total Primary Energy Consumption for the Industrial Sector - by Fuel Source: EIA, 2008b. Table 10.

83 Energy and CO2 Baseline Forecasts Figure 3-10 plots the baseline forecast of energy-related CO 2 emissions by fuel between 2005 and Note that biogenic renewable sources (biofuels) are not counted in these emissions by the EIA since they are considered to be balanced by the carbon sequestration that occurs during their creation. Primary energy used to generate electricity is reflected in the data. The data also include emissions from all end-use sectors, including transportation. Currently, petroleum products are the greatest contributors to CO 2 emissions, followed by coal and then natural gas. By 2030, coal products are expected to be the largest emitters (2,841 million metric tons per year), followed closely by petroleum products (2,767 million metric tons per year) and then by natural gas (1,231 million metric tons per year). Energy-Related CO 2 Emissions - By Fuel Million Metric Tons Coal Natural Gas Petroleum NOTE: CO 2 emissions for other non-biogenic fuels are not shown because they are negligible (~12 million metric tons per year). Figure 3-10 Energy-Related CO 2 Emissions for All Sectors - by Fuel Source: EIA, 2008a. Table

84 Energy and CO2 Baseline Forecasts Industrial Subsector Data Figure 3-11 and Figure 3-12 illustrate the projected breakdowns of energy use and CO 2 emissions by industrial subsector. The CO 2 emissions data generally follow the energy data, with the growth in CO 2 emissions lagging the growth in energy consumption by a bit. Overall, energy-related industrial CO 2 emissions are forecasted to increase by a very modest 3% between 2005 and 2030, while energy use is forecasted to increase by 7%. Currently, the bulk chemical industry is the largest single energy user and CO 2 emitter, followed by the refining, paper, mining, and construction industries. The iron and steel, food, aluminum, glass, cement, and agriculture industries are also significant energy consumers and CO 2 emitters. By 2030, the refining industry is expected to surpass the bulk chemical industry in terms of energy use and CO 2 emissions. Total Energy Consumption - By Industry 40,000 Trillion BTU. 35,000 30,000 25,000 20,000 15,000 10,000 5, Mining Construction Agriculture Glass Industry Aluminum Industry Cement Industry Paper Industry Food Industry Iron and Steel Industries Bulk Chemical Industry Refining Industry Other Figure 3-11 Total Primary Energy Consumption for the Industrial Sector - by Industry Source: EIA, 2008b. Tables

85 Energy and CO2 Baseline Forecasts Energy-Related CO 2 Emissions - By Industry Million Metric Tons 2,000 1,800 1,600 1,400 1,200 1, Mining Construction Agriculture Glass Industry Aluminum Industry Cement Industry Paper Industry Food Industry Iron and Steel Industries Bulk Chemical Industry Refining Industry Other Figure 3-12 Energy-Related CO 2 Emissions for the Industrial Sector - by Industry Source: EIA, 2008b. Tables

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87 4 TECHNICAL AND REALISTIC POTENTIALS This chapter details the results of the study. For each end-use sector considered, the discussion begins by describing the methodology used to determine the technical and realistic potentials. Though the methodologies are similar for the various sectors, there are some differences due to the nature of the sectors and because two different sub-teams conducted the analyses one subteam for the residential and commercial sectors and another sub-team for the industrial sector. The chapter then continues by presenting the technical and realistic potentials for energy savings and CO 2 emissions reductions as a function of end-use sector, displaced fossil-fuel type, electric end-use technology, and census region. The technical potential values represent the maximum, technically-feasible impacts that would result if the selected electric technologies were to displace fossil-fueled technologies. The technical potential does not take into account costeffectiveness or customer response, both of which would realistically decrease technology adoption. For the realistic potential, it was beyond the scope of the study to do a thorough evaluation of the effects of economics and customer response; nevertheless, the project team used professional judgment and industry experience to estimate more realistic potential values. Before presenting the study s methodologies and results in detail, it is important to mention a caveat to the general procedure the project team followed. Forthcoming explanations will show that the type of approach taken for estimating the technical and realistic potentials for saving energy and reducing CO 2 emissions was clearly advantageous to allow detailed analysis of different technology assumptions for different end-use applications. However, energy savings and CO 2 emissions reductions will also be influenced by macroeconomic effects like competition between end-use investments and non-energy investments, as well as by potentially more attractive CO 2 emissions reductions pathways via supply-side technology development and deployment. An integrated assessment model would be needed to analyze the effects of these issues more fully. Table 4-1 and Table 4-2 summarize the technical potential results by end-use sector. Table 4-1 contains cumulative data, while Table 4-2 contains annual values. The cumulative numbers represent cumulative impacts between the study s start year of 2009 and the given year. Thus, a value listed for a given year includes all impacts accumulated between 2009 and that year. In contrast, the annual numbers represent the impacts for the given year they are essentially a snap-shot in time. The project team favored presenting cumulative values in this report since they illustrate the entire potential for saving energy and reducing CO 2 emissions throughout the study period. As such, most of the data that follow are provided in terms of cumulative values. Table 4-1 and Table 4-2 show that the residential sector has the greatest promise for beneficial impacts. The commercial and industrial sectors follow with values that are roughly comparable to each other. Between 2009 and 2030, the cumulative technical impacts of all sectors combined are energy savings of 71.1 quadrillion BTUs and CO 2 emissions reductions of 4,400 million metric tons. These values equate to annual impacts of 5.32 quadrillion BTUs per year and 320 million metric tons per year in

88 Technical and Realistic Potentials Table 4-1 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Sector Favorable Electric Technologies Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Sector Residential ,560 Commercial Industrial U.S ,470 4,400 Table 4-2 Technical Potential: Annual Impacts on Primary Energy Use and CO 2 Emissions by Sector Favorable Electric Technologies Decrease in Primary Energy Use (Quadrillion BTUs per Year) Decrease in CO 2 Emissions (Million Metric Tons per Year) Sector Residential Commercial Industrial U.S Table 4-3 and Table 4-4 present the analogous results for the realistic potential. In the realistic case, the industrial sector has the highest potential for energy savings, followed by the residential sector and then commercial sector. In regards to the realistic potential for CO 2 reductions, the residential sector holds the greatest promise, followed by the industrial sector and then the commercial sector. Between 2009 and 2030, the cumulative realistic impacts of all sectors combined are energy savings of 21.0 quadrillion BTUs and CO 2 emissions reductions of 1,490 million metric tons. These values equate to annual impacts of 1.71 quadrillion BTUs per year and 114 million metric tons per year in

89 Technical and Realistic Potentials Table 4-3 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Sector Favorable Electric Technologies Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Sector Residential Commercial Industrial U.S ,490 Table 4-4 Realistic Potential: Annual Impacts on Primary Energy Use and CO 2 Emissions by Sector Favorable Electric Technologies Decrease in Primary Energy Use (Quadrillion BTUs per Year) Decrease in CO 2 Emissions (Million Metric Tons per Year) Sector Residential Commercial Industrial U.S Figure 4-1 and Figure 4-2 graphically display the combined impacts of the three sectors relative to the baseline forecasts for primary energy consumption and CO 2 emissions, respectively. The primary energy baseline data include all delivered energy for the residential, commercial, industrial, and transportation sectors as well as electricity-related losses. Similarly, the CO 2 baseline forecast includes total energy-related CO 2 emissions across all sectors. Both technical and realistic potential impacts are plotted against the baselines. In terms of the potential for energy savings (Figure 4-1), the technical potential is associated with a 4.5% reduction relative to the baseline in the year 2030, while the realistic potential yields a 1.5% decrease in For CO 2 emissions, the technical potential reduces baseline emissions by 4.7% in the year 2030 and the realistic potential reduces baseline emissions by 1.7% during the same year. 4-3

90 Technical and Realistic Potentials Comparison with Baseline Forecast Primary Energy Historic Forecast Historic EIA Reference Case Realistic Potential Technical Potential 4.5% 1.5% Figure 4-1 Historic and Forecasted Primary Energy Consumption: Combined Impacts of Three Sectors Compared with Baseline Forecast 7,000 Comparison with Baseline Forecast 1.7% CO2 Emissions (Million Metric Tons). 6,500 6,000 5,500 5,000 4,500 4,000 Historic Forecast 4.7% Historic EIA Reference Case Realistic Potential Technical Potential Figure 4-2 Historic and Forecasted Energy-Related CO 2 Emissions: Combined Impacts of Three Sectors Compared with Baseline Forecast 4-4

91 Technical and Realistic Potentials Residential Sector Methodology This section describes the methodology followed to determine the technical and realistic potentials for saving energy and reducing CO 2 emissions by expanding end-use applications of electricity in the residential sector. Table 4-5 summarizes the general parameters used in the residential sector savings estimate. The analysis considered displacing fossil-fueled technologies operated with five main fuel types: coal, distillate fuel oil, kerosene, natural gas, and propane/lpg. In addition, replacement electric technologies were evaluated for three end-use areas: clothes drying, space heating, and water heating. The study investigated the effects of replacing all fossil fuel consumption for each of the fuels and end-uses on a phase-in basis in the four U.S. census regions: Northeast, Midwest, South, and West. Energy and CO 2 emissions data from the EIA AEO 2008 were used for the baseline information. 13 The timeframe of the analysis was 2009 through Table 4-5 General Characteristics of the Methodology Used for the Residential Sector Purpose Fuel Types Considered End-Use Areas Census Regions To evaluate the technical and realistic potential for saving energy and reducing CO 2 emissions by replacing fossil-fueled end-use technologies with efficient electric end-use technologies Natural gas, distillate fuel oil, propane/lpg, kerosene, and coal Clothes drying, space heating, and water heating Northeast, Midwest, South, and West Baseline for Comparison EIA AEO 2008 Timeframe The specific steps included in the methodology are listed below. 1. Identification and Characterization of Electric Technologies: To begin with, highly efficient electric end-use technologies with the potential for energy savings over fossil-fueled technologies were identified. The most efficient products available today or in the process of commercialization were used to evaluate the savings potential. 2. Identification and Characterization of Fossil-Fueled Technologies: Every fossil-fueled technology that could be replaced by the previously identified electric technologies was identified. Certified product listings and similar literature were used to evaluate the average efficiency of products commercially available today. 3. Baseline Forecasts: The project team used data from the EIA AEO 2008 to develop energy and CO 2 baseline forecasts through 2030 (see Chapter 3) Annual Energy Outlook 2008 with Projections to 2030, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Table

92 Technical and Realistic Potentials 4. Breakout by Fuel: The energy use was broken down by fuel type: natural gas, coal, fuel oil, distillate fuel oil, kerosene, propane/lpg and electricity. 5. Breakout by End-Use: Using the EIA AEO 2008, consumption of natural gas, distillate fuel oil, and propane/lpg were broken down by end-use. Further inspection of the residential forecast showed that all coal and kerosene consumption were allotted to space heating; therefore no additional end-use breakdown was needed Breakout by Region: For each fuel type, the energy use was then allocated to the four census regions: Northeast, Midwest, South, and West. The Household Energy Consumption and Expenditures Tables in EIA s 2001 Residential Energy Consumption Survey (RECS) were used to allocate natural gas, distillate fuel oil, and propane/lpg space and water heating consumption to each region. 14 With all kerosene and coal consumed for space heating, the regional forecasts for these fuels came directly from the Supplemental Tables to the AEO Natural gas consumption for clothes drying was estimated based on the number of units in each region from the 2005 RECS, and the unit energy consumption of the clothes dryers. 16 Figure 4-3 illustrates the end-use energy allocation process. 7. Phase-Out of Fossil-Fueled Technologies: Next, the equipment lives listed in Appendix C were used to phase-out fossil-fueled technologies. The result was a modified energy consumption forecast that reflected the displaced fossil-fueled technologies for each type of fossil fuel analyzed. From this, the cumulative decrease in fossil fuel use due to expanding end-use applications of electricity was calculated through the study period of 2009 to Increase in Electricity due to Phase-In of Electric Technologies: Using the fossil fuel savings resulting from Step 7 and the energy efficiency ratios, the associated increase in delivered electricity use was determined. The energy efficiency ratios were based on general technology categories and represented stock efficiency where possible. The efficiency ratios are available in Appendix A. 9. Net Decrease in Primary Energy Use: The increase in primary electricity use was calculated next using the primary-to-delivered electricity ratios listed and described in Appendix D. The increase in primary electricity use was subtracted from the decrease in fossil fuel use to find the net decrease in primary energy use due to expanding end-use applications of electricity at the regional and technology level. 10. Decrease in CO 2 Emissions due to Reduced Fossil Fuel Use: The decrease in CO 2 emissions due to phase-out of fossil-fueled technologies was determined based on energy savings using the fossil fuel emission factors provided in Appendix E Residential Energy Consumption Survey, Energy Information Administration, U.S. Department of Energy, Washington DC: released 2004, 15 Supplemental Tables to the Annual Energy Outlook 2008, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Tables Residential Energy Consumption Survey Detailed Tables, Energy Information Administration, U.S. Department of Energy, Washington DC: released April 2008, Table HC

93 Technical and Realistic Potentials Sector Residential Sector Fuel Type Coal Kerosene Natural Gas Propane /LPG Distillate Fuel Oil End-Use Clothes Drying Space Heating Water Heating Region Northeast Midwest South West Technology Coal Space Heating Fuel Oil Space Heating Natural Gas Water Heating Etc. Figure 4-3 Illustration of Residential Sector Energy Use Allocation down to the Technology Level 4-7

94 Technical and Realistic Potentials 11. Increase in CO 2 Emissions due to Electric Technologies: Then, the corresponding increase in CO 2 emissions due to increased electricity use was calculated using the emissions factors for electricity generation tabulated in Appendix E. The factors were derived by coupling electricity sales and CO 2 emissions data from the EIA AEO ,18 with regional emission factors from egrid Net Decrease in CO 2 Emissions Screening Step: The net CO 2 savings were calculated by subtracting the increase in electricity-related CO 2 from the reduction in fossil fuel-related CO 2. If displacing a fossil-fueled technology with an electric technology increased overall CO 2 emissions, the technology failed the screening criteria required for being a beneficial electric technology. Thus, this step yielded a short list of favorable electric end-use technologies. 13. Technical and Realistic Potentials: The technical and realistic potentials for energy savings and reductions in CO 2 emissions were calculated for the short list of favorable technologies. Favorable Electric End-Use Technologies The results of the screening process yielded the short list of favorable electric end-use technologies shown in Table 4-6. Of the eight residential electric technologies analyzed, six resulted in net reductions in CO 2 emissions under the scenario evaluated. All of the favorable technologies offered net energy and CO 2 savings potential in each of the census regions with the exception of heat pump clothes dryers in the Midwest, and electric instantaneous water heaters which were favorable only when displacing distillate fuel oil in the Northeast. It is very important to stress here that the outcome of the screening exercise is highly dependent on the projected CO 2 intensity of the electricity generation mix of the future. As already explained, the baseline forecast used for the current study was derived from the EIA AEO This forecast information does not presume that future policy changes may lower the CO 2 intensity of the generation mix during the study period. However, with the present momentum to curb greenhouse gas emissions, there is a possibility that policies affecting the CO 2 intensity will be enacted in the near future. With a lower CO 2 intensity of the generation mix, more of the efficient electric end-use technologies analyzed would fall under the favorable category. Indeed, additional electric technologies would cross the line and become favorable if the CO 2 emissions factors decreased even modestly between now and For example, heat pump clothes dryers would also have savings potential in the Midwest with a 10% reduction in CO 2 emissions factors. 17 Annual Energy Outlook 2008 with Projections to 2030, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Table Supplemental Tables to the Annual Energy Outlook 2008, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Tables Year 2004 Summary Tables, egrid2006, Version 2.1, U.S. Environmental Protection Agency, Washington, DC: April 2007, 4-8

95 Technical and Realistic Potentials Table 4-6 Short List of Favorable Residential Electric End-Use Technologies Capable of Yielding Net Reductions in CO 2 Emissions Electric End-Use Technologies Yielding Net Reductions in CO 2 Emissions Electric Technologies Analyzed (Long List) Net Decrease in CO 2 Emissions? Favorable Electric Technologies (Short List) Heat Pump Clothes Dryer Yes (All but Midwest) Heat Pump Clothes Dryer Heat Pump Pool/Spa Heater Yes Heat Pump Pool/Spa Heater Air-Source Heat Pump, Cooling Yes Air-Source Heat Pump, Cooling Air-Source Heat Pump, Heating Yes Air-Source Heat Pump, Heating Ground-Source Heat Pump, Cooling Yes Ground-Source Heat Pump, Cooling Ground-Source Heat Pump, Heating Yes Ground-Source Heat Pump, Heating Electric Instantaneous Water Heater Yes (Only Northeast) a Electric Instantaneous Water Heater Heat Pump Water Heater Yes Heat Pump Water Heater Electric Convection Oven Electric Induction Range Top No No a Net decrease in CO 2 emissions only when displacing distillate fuel oil water heating in the Northeast. A couple of the favorable technologies in Table 4-6 were not included in the subsequent savings estimates where sufficient end-use data was not available. Overall, the impact of including these technologies was assumed to be marginal compared to the effects of displacement of space heating and water heating which account for 93% of fossil fuel consumption in the residential sector. 13 The following technologies were not included in the savings estimates: Heat Pump Pool/Spa Heaters: Lack of end-use consumption data at a national and regional level. Heat Pumps for Space Cooling: Marginal fossil fuel consumption accounting for less than a thousandth of a percent of natural gas consumption over the entire forecast period. Technical Potential This section summarizes the results of the technical potential analysis for the favorable residential electric end-use technologies. For the purpose of evaluating the technical potential for energy and CO 2 savings, ground-source heat pumps were used to displace space heating consumption in all the census regions. Air-source heat pumps are less efficient at this point, particularly for space heating because their heating efficiency is dependent on the outdoor temperature. Table 4-7 shows the cumulative impacts on primary energy use and CO 2 emissions by electric technology; in addition, the total represents the nationwide energy and CO 2 savings. Space 4-9

96 Technical and Realistic Potentials heating represents about 74% of residential fossil fuel consumption annually over the forecast period and presents the biggest potential for energy and CO 2 savings. 13 Displacement of fossilfueled space heating with heat pumps results in cumulative energy savings of 32.3 quadrillion BTUs and cumulative CO 2 savings of 1,970 million metric tons from 2009 to Fossil-fueled water heating represents about 18% of fossil fuel consumption in the residential sector over the forecast period. 13 Heat pump water heaters have the potential to save 9.59 quadrillion BTUs and reduce CO 2 emissions by 573 million metric tons. Finally, heat pump clothes dryers have the potential to save 0.14 quadrillion BTUs and to reduce CO 2 emissions by 14.4 million metric tons. In total, these three electric technologies have the potential to reduce primary energy consumption by 42.1 quadrillion BTUs and reduce CO 2 emissions by 2,557 million metric tons from 2009 to Table 4-7 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Favorable Electric End- Use Technology Heat Pump Clothes Dryer Heat Pump Space Heating ,252 1,970 Heat Pump Water Heater Total ,669 2,557 Table 4-8 shows the technical potential results by census region. All favorable electric technologies for a specific region are included in the values provided for that region. The Northeast has the most potential for beneficial emissions impacts, with 10.5 quadrillion BTUs of energy savings and 832 million metric tons of CO 2 emissions reductions projected between 2009 and The Midwest follows with slightly higher potential energy savings of 12.8 quadrillion BTUs and the potential to reduce CO 2 emissions by 636 million metric tons. The potential for the South is 11.1 quadrillion BTUs of energy savings and 582 million metric tons of emissions reductions. Lastly, the West has a potential to save 7.7 quadrillion BTUs and to reduce CO 2 emissions by 507 million metric tons. It is interesting to note that although the cumulative energy savings are higher in the Midwest and South, the Northeast still has a higher potential for emissions reductions. This is mainly due to the fact that the CO 2 intensity of electricity is higher in both the Midwest and the South and therefore the net CO 2 savings are not as high. 4-10

97 Technical and Realistic Potentials Table 4-8 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) All Favorable Electric End-Use Technologies Northeast Midwest South West U.S ,669 2,557 Note that in the previous two tables and throughout the discussion of the technical and realistic potential results, the decrease in primary energy use was calculated by subtracting the increase in primary electricity use from the decrease in fossil fuel use due to expanding end-use applications of electricity. Appendix L includes the corresponding increases in delivered and primary electricity use and the decreases in fossil fuel use by region and electric technology type for the cases of technical potential and realistic potential. Heat Pump Clothes Drying Table 4-9 summarizes the characteristics investigated for heat pump clothes dryers displacing natural gas clothes drying in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all but the Midwest census region. Table 4-9 Technology Characteristics Heat Pump Clothes Dryers Displacing Natural Gas Clothes Dryers Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Heat Pump Clothes Dryer Natural Gas Clothes Dryer 12 years EE Ratio Pass/Fail Pass in all but Midwest The greatest potential for savings is in the West with a potential for saving quadrillion BTUs and 7.58 million metric tons of CO 2 through The total savings due to heat pump clothes dryers are marginal compared to heat pump space and water heating, and in fact there is 4-11

98 Technical and Realistic Potentials an increase in CO 2 emissions in the Midwest. This is due to the fact that the CO 2 intensity of electricity is the greatest in the Midwest and the efficiency of the electrical system is the lowest of all of the census regions. With a 10% reduction in the CO 2 intensity of electricity in the Midwest, heat pump clothes dryers would have the potential to reduce CO 2 emissions throughout the entire U.S. For the entire residential sector, displacing natural gas consumed for clothes drying results in potential primary energy savings of quadrillion BTUs with potential CO 2 emissions reductions of 13.8 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table Table 4-10 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Clothes Dryers (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Heat Pump Clothes Dryers Northeast Midwest (0.01) (0.09) (0.21) (0.34) (0.52) South West U.S Heat Pumps for Space Heating Space heating is the heat pump application with the most potential for reduction of primary energy consumption and CO 2 emissions in the residential sector. From 2009 to 2030 space heating is forecast to account for about 74% of fossil fuel consumption in the residential sector. 13 In the U.S. today there are a number of fossil fuels that are burned directly to heat homes, including natural gas, distillate fuel oil, liquefied petroleum gases, wood, kerosene and coal. The types of equipment that use these fuels also vary and may be a standard forced-air furnace system, a boiler system, or a heating stove, to name a few. The following tables summarize the characteristics used to determine primary energy and CO 2 emissions reductions potential along with the resulting savings found for each technology. Displacing Coal Space Heating Table 4-11 summarizes the characteristics investigated for ground-source heat pumps displacing coal consumed for space heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. 4-12

99 Technical and Realistic Potentials Table 4-11 Technology Characteristics Ground-Source Heat Pumps Displacing Coal Space Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Ground-Source Heat Pump Coal Space Heating 20 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the Midwest with a potential for reducing primary energy consumption by quadrillion BTUs and reducing CO 2 emissions by 2.79 million metric tons through This is because the Midwest consumes at least 58% more coal for space heating than any of the other regions over the forecast period. 15 For the entire residential sector displacing coal consumed for space heating results in potential primary energy savings of quadrillion BTUs with potential CO 2 emissions reductions of 7.97 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table Table 4-12 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Ground- Source Heat Pumps Northeast Midwest South West U.S Displacing Distillate Fuel Oil Space Heating Table 4-13 summarizes the characteristics investigated for ground-source heat pumps displacing distillate fuel oil consumed for space heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. 4-13

100 Technical and Realistic Potentials Table 4-13 Technology Characteristics - Ground-Source Heat Pumps Displacing Distillate Fuel Oil Space Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Ground-Source Heat Pump Distillate Fuel Oil Space Heating 26 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the Northeast with a potential for reducing primary energy consumption by 2.48 quadrillion BTUs and reducing CO 2 emissions by 257 million metric tons through The difference in savings compared to the other regions is due to the fact that the Northeast consumes six times the amount of fuel oil for space heating compared to the Midwest or the South and 37 times as much as the West. 15 For the entire residential sector displacing distillate fuel oil consumed for space heating results in potential primary energy savings of 3.22 quadrillion BTUs with potential CO 2 emissions reductions of 323 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table Table 4-14 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Ground- Source Heat Pumps Northeast Midwest South West U.S Displacing Kerosene Space Heating Table 4-15 summarizes the characteristics investigated for ground-source heat pumps displacing kerosene consumed for space heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. 4-14

101 Technical and Realistic Potentials Table 4-15 Technology Characteristics Ground-Source Heat Pumps Displacing Kerosene Space Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Heat Pump Kerosene Space Heating 15 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the Northeast with a potential for reducing primary energy consumption by quadrillion BTUs and reducing CO 2 emissions by 40.3 million metric tons through This is because the Northeast consumes much more kerosene for space heating than the other census regions. 15 For the entire residential sector displacing kerosene consumed for space heating results in potential primary energy savings of quadrillion BTUs with potential CO 2 emissions reductions of 62.3 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table Table 4-16 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Ground- Source Heat Pumps Northeast Midwest South West U.S Displacing Natural Gas Space Heating Table 4-17 summarizes the characteristics investigated for ground-source heat pumps displacing natural gas consumed for space heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. 4-15

102 Technical and Realistic Potentials Table 4-17 Technology Characteristics Ground-Source Heat Pumps Displacing Natural Gas Space Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Ground-Source Heat Pump Natural Gas Space Heating 17 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the Midwest with a potential for reducing primary energy consumption by 9.52 quadrillion BTUs and reducing CO 2 emissions by 454 million metric tons through For the entire residential sector, displacing natural gas consumed for space heating results in potential primary energy savings of 26.6 quadrillion BTUs with potential CO 2 emissions reductions of 1,451 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table Table 4-18 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Ground- Source Heat Pumps Northeast Midwest South West U.S ,451 Displacing Propane/LPG Space Heating Table 4-19 summarizes the characteristics investigated for ground-source heat pumps displacing propane/lpg consumed for space heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. 4-16

103 Technical and Realistic Potentials Table 4-19 Technology Characteristics Ground-Source Heat Pumps Displacing Propane Space Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Ground-Source Heat Pump Propane/LPG Space Heating 15 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the South with a potential for reducing primary energy consumption by 0.71 quadrillion BTUs and reducing CO 2 emissions by 47 million metric tons through For the entire residential sector, displacing propane/lpg consumed for space heating results in potential primary energy savings of 1.77 quadrillion BTUs with potential CO 2 emissions reductions of 125 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table Table 4-20 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Ground-Source Heat Pumps (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Ground- Source Heat Pumps Northeast Midwest South West U.S Heat Pumps for Water Heating Heat pump technology has also been applied to domestic hot water heating and may be used to supplement or provide all of the hot water needed for a household. Heat pump water heaters that are commercially available today come in the form of an add-on unit that is integrated with an existing electric resistance storage water heater. The electrical heating element is used as a backup in the event that the heat pump cannot meet hot water needs on its own. In addition, drop-in replacement units are being developed that include the heat pump assembly, storage tank, and the electric resistance element all in a single unit. 4-17

104 Technical and Realistic Potentials The most efficient residential heat pump water heater found while surveying available products is the E-Tech R-106 Heat Pump Water Heater. This add-on unit has the capability to provide up to 350 gallons of hot water a day, and integrates with an existing electrical unit. In addition to hot water supply, heat pump water heaters have the benefit of cooling and dehumidifying the surrounding space. Like other air-source heat pumps, the water heater is extracting ambient heat from the surrounding air and amplifying it to heat the water. In addition to removing heat from the air, the E-Tech unit also removes moisture at a rate of 1.6 pints/hour. 20 Displacing Distillate Fuel Oil Water Heating Table 4-21 summarizes the characteristics investigated for heat pump water heaters displacing distillate fuel oil consumed for water heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. Table 4-21 Technology Characteristics Heat Pump Water Heaters Displacing Distillate Fuel Oil Water Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Heat Pump Water Heater Distillate Fuel Oil Water Heating 13 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the Northeast with a potential for reducing primary energy consumption by quadrillion BTUs and reducing CO 2 emissions by 63 million metric tons through Similarly to the case of displacement of fuel oil for space heating, the savings are much greater in the Northeast because it consumes about 20 times the amount of fuel oil for water heating as the South, and hundreds of times as much as in the Midwest and West. 15 For the entire residential sector, displacing distillate fuel oil consumed for water heating results in potential primary energy savings of quadrillion BTUs with potential CO 2 emissions reductions of 66.5 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table E-Tech R106K5 Residential High Efficiency Heat Pump Water Heater Product Data Sheet, Applied Energy Recovery Systems, Inc., Norcross, GA: Revised: January, 2008,

105 Technical and Realistic Potentials Table 4-22 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Heat Pump Water Heaters Northeast Midwest South West U.S Displacing Natural Gas Water Heating Table 4-23 summarizes the characteristics investigated for heat pump water heaters displacing natural gas consumed for water heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. Table 4-23 Technology Characteristics Heat Pump Water Heaters Displacing Natural Gas Water Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Heat Pump Water Heater Natural Gas Water Heating 11 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the West with a potential for reducing primary energy consumption by 2.31 quadrillion BTUs and reducing CO 2 emissions by 152 million metric tons through For the entire residential sector, displacing natural consumed for water heating results in potential primary energy savings of 8.65 quadrillion BTUs with potential CO 2 emissions reductions of 481 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table

106 Technical and Realistic Potentials Table 4-24 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Heat Pump Water Heaters Northeast Midwest South West U.S Displacing Propane/LPG Water Heating Table 4-25 summarizes the characteristics investigated for heat pump water heaters displacing propane/lpg consumed for water heating in the residential sector. This technology has the potential to achieve energy and CO 2 reductions in all census regions. Table 4-25 Technology Characteristics - Heat Pump Water Heaters Displacing Propane Water Heating Electric Technology Fossil-Fueled Technology Lifetime of FF Equipment Heat Pump Water Heater Propane/LPG Water Heating 11 years EE Ratio Pass/Fail Pass in all regions The greatest potential for savings is in the Midwest with a potential for reducing primary energy consumption by quadrillion BTUs and reducing CO 2 emissions by 8.32 million metric tons through For the entire residential sector, displacing propane/lpg consumed for water heating results in potential primary energy savings of quadrillion BTUs with potential CO 2 emissions reductions of 24.6 million metric tons through The cumulative energy and CO 2 emissions savings potential for each of the census regions are shown in Table

107 Technical and Realistic Potentials Table 4-26 Technical Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions Heat Pump Water Heaters (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Heat Pump Water Heaters Northeast Midwest South West U.S Realistic Potential To estimate a more realistic potential for CO 2 savings, the technical potential analysis was modified to incorporate more realistic parameters. The following changes were made in the technical potential analysis: 1. The phase-in penetration of electric technologies grew at half the rate of the technical potential, and the maximum fossil-fuel displacement for all end uses and technologies was 50%; 2. The efficiency of heat pump water heaters was reduced to a baseline of 2.5 COP; 3. Air-source heat pumps were used for displacement of all fossil-fueled space heating in the South and West census regions; 4. Ground-source heat pumps were used for displacement of all space heating consumption in the Northeast and Midwest as in the technical potential; 5. Air- and ground-source heat pump baseline efficiencies were near current ENERGY STAR ratings; 21,22 6. The efficiencies of all heat pumps used for space heating and heat pump water heaters were assumed to increase modestly over the forecast period, with a final value less than those used in the technical potential; 21 ENERGY STAR Program Requirements for Air-Source Heat Pumps and Central Air Conditioner Equipment, ENERGY STAR, U.S. Environmental Protection Agency, Washington, DC; April, 2006, ty_criteria.pdf. 22 ENERGY STAR Program Requirements for Geothermal Heat Pumps, ENERGY STAR, U.S. Environmental Protection Agency, Washington, DC; April, 2001,

108 Technical and Realistic Potentials 7. Electric instantaneous water heaters were used to replace half of the displaced distillate fuel oil for water heating in the Northeast (not favorable in other regions) with heat pumps displacing the rest; and 8. Fossil-fueled technology efficiencies remained the same as those in the technical potential and were constant over the forecast period. Due to the higher cost of ground-source heat pumps, air-source heat pumps were applied wherever feasible in the realistic potential. The efficiency of heat pumps for space heating drops considerably when the outside temperature is below 20 to 30 F, therefore air-source heat pumps were considered for space heating applications in the South and West census regions where winters are milder. Regional average monthly temperature data from the National Climatic Data Center was used to find which regions are best suited for ground-source heat pumps. 23 Table 4-27 summarizes the realistic potential for cumulative net primary energy savings and CO 2 emissions reductions by electric end-use technology. The technologies that failed in the realistic potential are heat pump clothes dryers in the Midwest, and heat pumps displacing natural gas for space heating in the South and therefore the savings are not included in the data. The residential sector as a whole has the potential to reduce primary energy consumption by 8.13 quadrillion BTUs and reduce CO 2 emissions by 652 million metric tons between 2009 and Compared to the technical potential the net energy reductions are 85% lower and the CO 2 savings are 75% less. Table 4-27 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Favorable Electric End-Use Technology (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) Favorable Electric End-Use Technology Heat Pump Clothes Dryer Heat Pump Space Heating Heat Pump Water Heating Electric Instantaneous Water Heater (0.00) (0.03) (0.09) (0.16) (0.22) Total State, Regional, and National Monthly Temperature, Weighted by Area, (and previous normal periods), Historical Climatography Series No. 4-1, National Climatic Data Center, NOAA, Asheville, NC: August, 2002,

109 Technical and Realistic Potentials Table 4-28 summarizes the realistic potential for cumulative net primary energy savings and CO 2 emissions reductions by region. The Northeast has the most potential for beneficial emissions impacts, with 2.99 quadrillion BTUs of energy savings and 328 million metric tons of CO 2 emissions reductions projected by The Midwest follows with slightly higher potential energy savings of 3.37 quadrillion BTUs and CO 2 emissions reductions of 145 million metric tons. The potential for the South is 1.12 quadrillion BTUs of energy savings and 63.2 million metric tons of emissions reductions. Lastly, the West has a potential to save 0.64 quadrillion BTUs and to reduce CO 2 emissions by 117 million metric tons. Again, although the cumulative energy savings are higher in the Midwest, the Northeast still has a higher potential for emissions reductions. This is mainly due to the fact that the CO 2 intensity of electricity is higher in the Midwest and therefore the net CO 2 savings are not as high. Table 4-28 Realistic Potential: Cumulative Impacts on Primary Energy Use and CO 2 Emissions by Region (Residential Sector) Decrease in Primary Energy Use Decrease in CO 2 Emissions (Million Metric Tons) All Favorable Electric End-Use Technologies Northeast Midwest South West U.S

110 Technical and Realistic Potentials Commercial Sector Methodology This section describes the methodology followed to determine the technical and realistic potentials for saving energy and reducing CO 2 emissions by expanding end-use applications of electricity in the commercial sector. Table 4-29 summarizes the general parameters used in the commercial sector savings estimate. The analysis considered displacing fossil-fueled technologies operated with four main fuel types: natural gas, distillate fuel oil, residual fuel oil, and coal. In addition, replacement electric technologies were evaluated for three end-use areas: space cooling, space heating, and water heating. The study investigated the effects of replacing all fossil fuel consumption for each of the fuels and end-uses on a phase-in basis in the four U.S. census regions: Northeast, Midwest, South, and West. Energy and CO 2 emissions data from the EIA AEO 2008 were used for the baseline information. 24 The timeframe of the analysis was 2009 through Table 4-29 General Characteristics of the Methodology Used for the Commercial Sector Purpose Fuel Types Considered End-Use Areas Census Regions To evaluate the technical and realistic potential for saving energy and reducing CO 2 emissions by replacing fossil-fueled end-use technologies with efficient electric end-use technologies Natural gas, distillate fuel oil, residual fuel oil, and coal Space cooling, space heating, and water heating Northeast, Midwest, South, and West Baseline for Comparison EIA AEO 2008 Timeframe The specific steps included in the methodology are listed below. 1. Identification and Characterization of Electric Technologies: To begin with, highly efficient electric end-use technologies with the potential for energy savings over fossil-fueled technologies were identified. The most efficient products available today or in the process of commercialization were used to evaluate the technical savings potential. 2. Identification and Characterization of Fossil-Fueled Technologies: Every fossil-fueled technology that could be replaced by the previously identified electric end-use technologies was identified. Certified product listings and similar literature were used to evaluate average efficiency of products commercially available today. 3. Baseline Forecasts: The project team used data from the EIA AEO 2008 to develop energy and CO 2 baseline forecasts through 2030 (see Chapter 3) Annual Energy Outlook 2008 with Projections to 2030, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Table

111 Technical and Realistic Potentials 4. Breakout by Fuel: The energy use was broken down by fuel type: natural gas, coal, distillate fuel oil, residual fuel oil, and electricity. 5. Breakout by End-Use: Using the EIA AEO 2008, consumption of natural gas and distillate fuel oil were broken down by end-use. 24 Inspection of end-use consumption data available in the 2008 Buildings Energy Data Book showed that all residual fuel oil and coal consumption were allotted to space heating; therefore, no additional end-use breakdown was needed Breakout by Region: For each fuel type, the energy use was then allocated to the four census regions: Northeast, Midwest, South, and West. EIA s 2002 Commercial Buildings Energy Consumption Survey (CBECS) was used to allocate natural gas and distillate fuel oil consumption for space heating, space cooling, and water heating to each region based on building square footage. 26 With all residual fuel oil and coal consumed for space heating, the regional forecasts for these fuels came directly from the Supplemental Tables to the AEO Figure 4-4 illustrates the end-use energy allocation process. 7. Phase-Out of Fossil-Fueled Technologies: Next, the equipment lives listed in Appendix C were used to phase-out fossil-fueled technologies. The result was a modified energy consumption forecast that reflected the displaced fossil-fueled technologies for each type of fossil fuel analyzed. From this, the cumulative decrease in fossil fuel use due to expanding end-use applications of electricity was calculated through the study period of 2009 to Increase in Electricity due to Phase-In of Electric Technologies: Using the fossil fuel savings resulting from Step 7 and the energy efficiency ratios, the associated increase in delivered electricity use was determined. The energy efficiency ratios were based on general technology categories and represented stock efficiency where possible. The efficiency ratios are available in Appendix A. 9. Net Decrease in Primary Energy Use: The increase in primary electricity use was calculated next using the primary-to-delivered electricity ratios listed and described in Appendix D. The increase in primary electricity use was subtracted from the decrease in fossil fuel use to find the net decrease in primary energy use due to expanding end-use applications of electricity at the regional and technology level. 10. Decrease in CO 2 Emissions due to Reduced Fossil Fuel Use: The decrease in CO 2 emissions due to phase-out of fossil-fueled technologies was determined based on energy savings using the fossil fuel emission factors provided in Appendix E Buildings Energy Data Book, Energy Efficiency and Renewable Energy, U.S. Department of Energy, Washington DC: September 2008, Commercial Buildings Energy Consumption Survey, Energy Information Administration, U.S. Department of Energy, Washington DC: released December 2006, 27 Supplemental Tables to the Annual Energy Outlook 2008, Energy Information Administration, U.S. Department of Energy, Washington DC: June 2008, Tables

112 Technical and Realistic Potentials Sector Commercial Sector Fuel Type Natural Gas Distillate Fuel Oil Residual Fuel Oil Coal End-Use Space Cooling Space Heating Water Heating Region Northeast Midwest South West Technology Natural Gas Space Cooling Coal Space Heating Fuel Oil Water Heating Etc. Figure 4-4 Illustration of Commercial Sector Energy Use Allocation down to the Technology Level 4-26