Division of Energy Resources Creating A Greener Energy Future For the Commonwealth MA Perspectives on Building Priorities for Climate and Energy Policy Philip Giudice Commissioner Phil.Giudice@State.MA.US January 14, 2009
Circumstance: Economic waste 2 Source: McKinsey 2008
Circumstance: Ratepayer Funded Efficiency 3,000 2,500 2,000 $ millions 1,500 1,000 500 Other Load Mgt Energy Efficiency 3 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Circumstance: 3,764 GWh Efficiency 2006 GWh 65,000 60,000 55,000 50,000 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 Net Consumed Renew Other Hydro Oil Egy Eff Nuc Coal Import 45,000 NGas 4 40,000 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Source: DOER, EIA
5 Circumstance: Efficiency is low cost option Cents per kwh 10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Source: DOER Relative Electricity Cost 5.54 5.70 3.76 8.91 3.29 3.20 7.3 Spot Wholesale 7.8 3.6 3.6 Efficiency 2003 2004 2005 2006 2007
Electricity Prices Across U.S. 6 Source: EIA
7 Creating A Greener Energy Future For the Commonwealth Circumstance: very high electric prices 2007 Retail Electric Price (Cents per kwh) 20 15 M A 10 5 0 HI CT NY MA NH NJ ME RI AK CA VT MD DE FL TX NV PA MI IL AZ LA WI MS OH GA NC CO AL MT NM MN OK SC VA TN OR AR KS SD IA IN MO UT WA ND NE KY WY WV ID Source: EIA Form 826
Circumstance: Unknowable future 10.00 9.00 Annual forecast: colored lines Actual: black line with diamonds 8.00 7.00 Natural Gas price per MMBTU 6.00 5.00 4.00 3.00 8 2.00 1.00 Actual 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Circumstance: availability of cheap oil 2004 Scenario 9
Circumstance: Meeting Peak Demand 100% 95% 90% 15% of Capacity for 1% of Hours Peak Capacity 85% 80% 75% 70% 10 65% 90% 91% 92% 93% 94% 95% 96% 97% 98% 99% 100% Annual Hours Source: ISO NE 2007 NEMA load zone
Circumstance: Few High Priced Hours 2007 NEMA LMP NEMA 2007 LMP 350 350 300 300 250 250 $ per MWh 200 150 $ per MWh 200 150 100 50 0 1 51 101 151 100 Hours 50 11 0 1 1001 2001 3001 4001 5001 6001 7001 8001 Source: ISO NE Hours
Opportunity: Green building 12 Source: Perkins+Will
Opportunity: Green building 13
Opportunity: Residential GWh 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 Today: $2.9 billion/yr Future: $2.2 billion/yr 2006 consumption: 19,601 GWh Future consumption: 15,050 GWh Savings potential: 4,551 GWh Lighting 1,439 Refrigeration 1,450 Water Heating 14 Drying Clothes 907 Air Conditioning 392 Furnace Fans 212 Other HVAC 23 Washing Clothes 114 14 0 Source: DOER, EIA Now Mile1 Mile2 Future
Opportunity: Simple Change Drive Result 1.8 TWh savings possible just w/ CFLs 3.2% reduction CFL Other Total Sockets Today 11,000,000 89,000,000 100,000,000 TWh Today TWh Possible 0.1 2.4 2.5 0.7 15
Opportunity: no magic bullets Electricity Usage in Commercial Buildings Electricity Usage in New England Households Cooking Other Space Heat Laundry Other AC Space Heat Refrigeration Cooling Computer TV Home Electronics Other Appliances Office Equipment Ventilation Lighting 16 Source: EIA Lighting Hot Water Hot Water Refrigerator
Priorities Stop wasting energy/ market failures abound Understand how its being used now Understand relevant options Change Building codes Raise the bar a lot Educate all and assure compliance Adopt substantially more energy efficient appliance and equipment standards 17
Priorities: MA Initiatives 18 Executive LBE RGGI 35% reduction by 2020 Funding efficiency expansion ZNEB Performance based outcomes 5 homes Pilot retrofit super insulation CERT/Energy Leaders competions MEPA Legislation Green Jobs Energy Efficiency Innovation Institute Ocean Management Clean Energy Biofuel Green Communities Building Codes Inspector Training Least cost procurement Community challenge grants Renewables/net metering Global Warming Solutions 80% GHG reduction by 2050
Beautiful or wasteful? 19