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City of Palo Alto Utilities(CPAU)
Efficiency Studies
from Comprehensive
to Customer-Specific
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CPAU Background
• Only CA publicly-owned utility providing electric, gas, water, & telecom (fiber)
• Electric- 26,000 accounts– 1,000 GWh/year, 190 MW peak load– Sales: 78% Commercial, 22% residential
• Long history of comprehensive energy & water efficiency programs (1980) and progressive renewable programs (1999)
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Electric Procurement
< 2005• Purchased 90% electricity from WAPA (low cost)
≥ 2005• Increased market purchases to ≥ 50% (higher
costs), driving double-digit rate increases each year
• Developed Long-term Electric Acquisition Plan• Hired Rocky Mountain Institute to examine
supply and demand-side opportunities.
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0
100
200
300
400
500
600
700
800
900
1000
1100
2006 2015
GWh/Year
Efficiency
Renewables
Existing Hydro(Normal Year)
Market
Deficit (NormalYear)
Load GrowthLoad GrowthStatus Quo
Enhanced efficiency efforts should reduce projected load growth.
Dry 30–60 MM$
Normal 20-40 MM$H
ydro
Var
iab
ility
New Renewables growing to 20%
What can we get from efficiency?Could be sufficient economic potential to offsetprojected load growth of 3-5% over 10 years, but not enough to eliminate deficit position.
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New Focus on Lower Bills
• Cost-effective efficiency programs reduce participating customer’s bills, with small increase in average rates.
• “Least-rate” approach underestimates economic efficiency potential from a total community viewpoint.
• Design efficiency programs to be inclusive. Minimize non-participants that absorb fixed program costs without benefiting from savings.
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RMI Report
• Quantitative and Qualitative• Top-down estimate of efficiency potential
– Gas and electric end uses– Residential and commercial sectors– Grouped measures into programs & sorted on
total resource cost ($/kWhlifetime)
• Study on efficiency program design– Focus on best practices across the nation– Match programs that would work for Palo Alto
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Economic Potential90 GWh = 9% of annual load
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Top Ten under 6¢
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Program Design Ideas
Enhance on-going CPAU programs.
Offer commissioning and building operator training programs.
Coordinate with neighboring utilities to leverage marketing efforts.
Treat low-income efficiency programs as alternatives to increased subsidies of energy purchases by these customers.
Create an integrated package of services, (i.e. site audit, technical assistance, and financial assistance) to lower perceived barriers and encourage implementation.
Consider innovative financing strategies such as on-bill financing and performance contracting. (billing system issues)
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CARE Program
Consultant Assistance for Resource Efficiency• Comprehensive studies tailored to meet
customer needs (Elec, Gas & Water)• Co-funded requires management support and
increases likelihood of implementation• Requires Prof. Engineer evaluation of life-cycle
cost of each alternative
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CARE Lessons Learned
• 146 Studies in 6 years, avg. cost $8,000
• Paradigm shift – From facility manager driven (reduce costs)– To CEO champion (sustainability-focus)– Cost-effective measures done first, now
getting more $$$ to go green
• Leverage focus on climate change, green business awards, LEED certification
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Case Study:
• Premier Properties manage 60 small to medium commercial buildings
• Add a green rider on lease to incorporate green energy costs
• Perform walk-thru audits to identify efficiency opportunities
• Use green to attract new tenants
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Case Study:
• Multi-year initiative to audit all school properties• Collaboration with school facilities staff,
administration, utility, teachers and community volunteers (Sustainable Schools Committee)
• Studies used for Master Development Plan ($378M bond passed 6/08)
• Building System manual provides detailed operating instructions per building
• Triple bottom line has economic, environmental and educational benefits
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Summary
• RMI Efficiency Potential study gets Utility management and City Council support
• Customer Studies get community to take action• There is a gap between economic potential and
what customers implement• Utility & customer staff and budget constraints• Turning to turn-key programs managed by third-
party