Energy Efficiency Trends and Opportunities

Emily Levin – Presentation to NH EERS Committee

November 18, 2019

Energy Efficiency Trends• Trends in electric energy efficiency

• Lighting transition

• Data, controls, and systems – oh my!

• EE portfolio diversification

• Expanding beyond traditional EE

• Building electrification

• Grid integration, flexibility, and non-wires alternatives

• Looking ahead

• Shifting goals and performance metrics for EE programs

The Lighting Transition: Implications for EE Programs

Lighting is Largest Share of Portfolio SavingsRhode Island Maryland

Lighting is Largest Share of Portfolio Savings

ISO New

England

Region

Lighting Market is Rapidly Changing• Residential: EISA phased out

general service incandescent lamps in 2012-2014• Phase II – EISA 2020: Backstop of 45

lumens per watt bars manufacture, import, and sales of general service lamps that don’t meet the backstop by Jan 1, 2020

• Trump administration recently reversed this rule, creating uncertainty

• Commercial: DOE rules phased out most T12 and T8 linear fixtures

DOE Market Forecast for Installed Lighting 2015-2035

Program Savings from Lighting are Diminishing

• Federal standards are setting a new “baseline”

• Less efficiency savings above baseline

• LEDs and halogens are becoming the default choice

• Prices are falling quickly• Rapid advancements in technology• Consumers prefer LEDs to CFLs

• Many sockets already have LEDs or CFLs so there are fewer sockets to fill

Overarching Portfolio Impacts

• Lighting is easy to install and relatively low cost

• Programs will have to rely on costlier measures, which often require more time and effort to install

• The results:• Higher cost per unit savings

• Less overall savings for similar budgets

• But a lot of cost-effective energy savings still available!

Residential Lighting Savings are Projected to Drop Substantially by 2020

Efficiency

Vermont model

Declining NTG Ratios a Major Challenge for EE Programs that Rely on Net Savings

Residential Portfolio Impacts• Residential lighting market will be largely transformed in states around NH (MA, VT) by the end of 2020

• Efficiency Vermont eliminating screw-based bulbs from portfolio starting January 1, 2021

• Likely still opportunities to support low-income and hard-to-reach markets with LED adoption

• Trump Administration rollbacks of EISA Phase II create uncertainty

C&I Lighting: Not a Cliff

Source: Energy Savings Potential of DLC Commercial Lighting and Networked Lighting

Controls, DesignLights Consortium, July 2018

LED C&I Fixtures Market Adoption Curve

Efficiency Vermont model: Continued

strong savings for 2021-2023 period

C&I Lighting Opportunities• Linear/troffer retrofits to LED, especially 2018-2020

• Controls if installed at the time of LED upgrade

• Connected lighting with demand response potential

Interior

Exterior

Key Points✓ While EE is getting more expensive due to the lighting transition, it is still

highly cost-effective and there are plenty of savings left to capture

Synapse modeling results:

• EE has national net benefits of $9.6 billion in 2030 under a Progressive Efficiency scenario

• Average 2030 annual bill savings of $147 for residential customers in the Progressive EE scenario

• EE reduces regional annual energy needs by 20% by 2030 in the Progressive EE case

• 34% less gas generation in the Progressive EE case compared to 2017

Data, Controls, and Systems

Advanced Metering Infrastructure (AMI)

Connected Home Devices

Controls and Automation• Driven by:

• Low-cost embedded computing

• Ubiquitous networks (WiFi & Cell)

• Interoperability standards

• Not new; already common for large customers

• Becoming cheap & easy to scale to residential and small business

Machine Learning• A more advanced form of search or pattern recognition

• Useful for analyzing huge amounts of data • Customer classification for targeting or comparison groups

• Predictive algorithms for peak events or EE baseline estimation

• Advanced controls with “learning” algorithms

Generates visuals for

human consumption

Uses models to select

algorithm for better

management

Builds predictive models

Gathers data from sources (i.e., smart

thermostats)

Customer Targeting Using AMI Data

Remote Energy Audits

Data-Driven Programs: Residential

• Home energy reports

• Behavioral demand response• Example: BGE Smart Energy

Rewards

• Behavioral messaging leveraging smart devices

• Pay for performance

Smart Thermostats

• Cheap, connected sensors produce lots of data

• The challenge is harnessing the data to drive energy and demand savings:

• Customer engagement

• HVAC optimization

• Demand response

Data-Driven Programs: Commercial & Industrial

Gartner’s Hype Cycle for Emerging Tech

Internet of Things

EE Portfolio Diversification: Vermont Example

Efficiency Vermont: Lighting as % of Portfolio Savings

Residential Shift Key Trends• No one measure can

replace LED bulbs @ 40,000 MWh

• Range of backfill measures

• Increased cold-climate heat pump adoption

• Increased need for efficient cooling

• Smart home tech R&D

• Lighting fixtures remain in portfolio

C&I Shift Key Trends• Continued growth

refrigeration and industrial process measures

• Continuous Energy Improvement program supports growing behavioral C&I measures

• LED fixtures and controls remain important measures

Building Electrification

0

10000

20000

30000

40000

50000

60000

70000

0

50

100

150

200

250

300

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

CO

2M

ass

(Mill

ion

To

ns)

NO

x an

d S

O2

Mas

s (T

ho

usa

nd

To

ns)

New England New York

CO2CO2 NOXSO2

SO2NOX

Emissions from Electricity Generation 2001-2014 (New York and New England)

Northeast Electric Grid is Getting Cleaner

Source: U.S. EIA Energy Mapping System

Natural Gas Pipeline in Northeast US

State

Housing

Units

Heated

with

Natural

Gas

CT 33.6%

MA 50.1%

ME 6.0%

NH 19.7%

NY 56.8%

RI 51.8%

VT 16.5%Source: U.S. Census Data 2015

Limited Access to Natural Gas in the Region

Heat Pumps Have Lowest GHG Emissions

Building Electrification

• Heat pumps use electricity to move heat, which is very efficient

• Most northeastern states have set “clean heating” or “energy optimization” goals

• Heat pump water heaters

• Use 60% less energy than electric tank

Air-Source Heat Pump Usage in the Northeast• Most common application:

o Ductless mini-splito Installed in home with oil or propane boilero Home retains backup fossil fuel systemo Adds new cooling load

• Cost-effective compared to heating with oil or propane; not yet for natural gas

• Wide variability in use of heat pump vs. backup system

• NEEP Cold Climate specification designates products that meet heating performance standards at low temperatures

State PolicyBinding

Target?

Dedicated Funding

Source?

CT Comprehensive Energy Strategy No No

MA Alternative Portfolio Standard Yes Yes

ME

LD 1766 “An Act To Transform Maine's Heat

Pump Market To Advance Economic Security and

Climate Objectives” sets goal of installing 100,000

heat pumps in Maine by 2025

Yes Yes

NHThermal Renewable Energy Certificate program

but ASHPs not currently included No No

NYREV Clean Energy Fund; target for MMBtu

savings for ASHPs under New Efficiency NYYes Yes

RIResilient Rhode Island Act

Power Sector TransformationNo No

VT

Comprehensive Energy Plan

Renewable Energy Standard including energy

transformation

Yes Yes

State Policies Promoting Heat Pumps

ME & VT: Driving Adoption of Cold-Climate Heat Pumps

CEP Target of

35,000 by 2025

• Robust incentives

• Upstream/midstream programs to engage manufacturers and distributors

• Extensive marketing

• Strong customer economics for customers that heat with oil & propane

MA & NY: Clean Heating & Cooling Campaigns

• CH&C Campaigns help homes and businesses in the same area install these technologies through locally organized community outreach

• Competitive solicitation process that aggregates homeowner buying power to lower installation prices for participants

MA: Heat Pump Controls to Manage Backup Heat

Mass Save rebates for mini-split heat pumps: https://www.masssave.com/en/saving/residential-rebates/electric-heating-and-cooling/

Much higher “fuel optimization” rebate for fuel switching from oil or propane ($150-350/ton for standard install)

Integrated controls required unless central heating system is removed

VT & NY: Weatherization + Heat Pumps

http://bppa-vt.org/page-1737726

• Vermont Zero Energy Now Pilot:

• Wx + heat pumps + PV

• 50-80% reduction in total energy use

• NYSERDA Heat Pump Ready Pilot:

• Demonstrate affordable standard packages of whole house load reduction measures (air sealing, insulation, duct repair/sealing, low E windows, smart controls)

• Create a viable and innovative service model for contractors

Electrification & Efficiency: Strategic Partners✓ The grid has capacity for electrification at the right time and

place

✓ Efficiency reduces peak demand and creates space for electrification on the grid

✓ Demand flexibility is key to mitigate peak impacts

✓ Building shell improvements make heat pump heating and cooling loads more flexible and avoid oversized HVAC and PV systems

Distributed Energy Resources, Flexibility, & Grid Integration

Key Trends

The DER Toolbox: Deploying Electrification & Efficiency Strategically

The

New

EfficiencyTraditional

Energy Efficiency & the Grid

Efficiency

ProgramCoordinated Flexible

Loads

Time & Geographic

loads

• Smart charging

• Connected loads

• Bring your own device

(BYOD)

• Time and geotargeted

initiatives

Demand Response is Getting Smarter 1

Demand Response is Getting Smarter 2

Four Types of Demand Flexibility

VT: Time-Targeted EE using AMI Data (Shape)

Goal: Flatten Vermont’s Growing Duck through Time-Targeted EE

Savings Curve for LEDs on High Stress Cold Days

Savings Curve for High Efficiency Pool Pumps on High Stress Hot Days

• Demand response + flexible loads

• Anomalous loads

• Rate guidance

• P4P & BYOD Programs

• Customer engagement & behavior change

Time-Targeted EE: Insights from Advanced Home Energy Monitors

VT: Bring Your Own Device Demand Flexibility (Shift)

• Pilot testing grid-interactive water heaters as a virtual thermal battery

• Soon expanding to EV charging

• Collaboration between WEC and Efficiency Vermont

VT: C&I Demand Flexibility (Shift)

• Collaborative effort between Dynamic Organics, Efficiency Vermont and Green Mountain Power

• Existing ice storage system at Brattleboro Retreat• Installed 4 years ago, never commissioned and improperly controlled

• Wasting $12,000 per year

• Savings of $28,000 by optimizing and aligning building and grid efficiencies

$10,500 Efficiency

+ $ 5,000 Off-Peak Demand Charge Forgiveness

+ $13,000 RNS/FCM Savings (bill credit from GMP for avoided capacity

charges)

===========

$28,500 * Total Annual Savings Estimate

* Only includes Efficiency, Demand Forgiveness, and RNS (3), FCM (1)

MA: Battery Storage• MA 2019-2021 EE plan includes behind-

the-meter (BTM) battery storage as part of new focus on “active demand reduction”

• Passed TRC test

• Incentives: $100/kWh average load reduction for “targeted” dispatch program; $200/kWh average load reduction for daily dispatch program

• A commercial customer installing a 60-kWh battery system might be able to earn $2,000/year or $10,000 over the 5-year contract plus additional demand charge savings

VT: Geotargeted EE 2009-2011

Northern Chittenden County Addition to 2007-2008 Area

Newport - Removed

Rutland –New Area in 2009-2011

St. Albans & Northern Chittenden County Existing Area Maintained

Southern LoopExisting Area Maintained

Approx. # AccountsResidential: 62,000Commercial: 11,000Industrial: 15

Targets & ResultsCumulative

Summer Peak Target 8,100 kWActual 11,957 kW

Winter Peak Target 2,400 kWActual 2,807 kW

• Large C&I• Custom projects with high kW

savings

• Small Business• Targeted markets

(convenience stores, restaurants, etc.)

• Targeted technologies (pool pumps, refrigeration, etc.)

• Direct install, enhanced incentives

• Residential• Increased marketing,

incentives, community efforts• Primarily lighting, appliances,

pool pumps

• Central Hudson Gas and Electric Company, NY

• Goal: Defer distribution system upgrades in areas where peak demand is nearing system capacity

• Solution: provide cash rewards and free control equipment to residential customers in targeted areas that use central AC and/or pool pumps, and commercial customers with large loads

NY: Geotargeted Demand Response to Reduce Infrastructure Upgrades

• Boothbay pilot project combined solar, storage, demand response and EE to reduce demand

• 2019 NWA law requires certain utility proposals for transmission or distribution system upgrades or expansions to be reviewed to see if NWAs present a viable, cost-effective alternative solution

• When BTM NWA resources are determined to be viable and cost-effective option then the law directs Efficiency Maine to develop and deploy those resources

ME: Non-Wires Alternatives (NWAs)_

Integrated DERs• IDER: Integrated delivery to customers of at least two DERs:

efficiency, demand response, renewables, and storage

• Southern California Edison’s Preferred Resource Pilot is using IDER to defer upgrades to a constrained substation

IDER: Getting Started

1. Pilot, pilot, pilot!

2. Bring Your Own Thermostat (BYOT) program to enroll smart

thermostats in demand response

3. Bundle energy efficiency and demand response:

• Promote installation of efficient equipment with smart controls

• Get data permissions with incentive agreements

4. Behavioral demand response at peak times

5. Time-of-use rates for electric vehicles

Next-Generation Goals for EE Programs

Next-Generation Goals

• States are beginning to align EE program goals (and utility

performance incentives) with state policy goals:

• Peak demand reduction

• Fuel-neutral energy savings or GHG reduction

• Market transformation indicators

• Energy or GHG savings for low-income customers or other target

groups

MA Clean Energy Bill• MA Legislature passed clean energy bill on July 31, 2018

• Key provisions of H.4857, An Act to Advance Clean Energy:

• Replaces “electric” with “energy” in EE statute

• Adds energy storage, active demand management, and strategic

electrification as eligible under EE programs

• Adds programs that result in customers switching to renewable energy sources

or other clean energy technologies to EE plans

• Broadens cost-effectiveness screening to ensure that programs "obtain energy

savings and other benefits with value greater than the costs of the program"

rather than energy savings and system benefits

• Requires cost-effectiveness at sector level rather than measure level

Massachusetts: EE Program Metrics in 2019-2020 Period

Old Goal New Goal Advantage

Lifetime kWh

savings

Lifetime MMBtu

savings

• Converts electric, oil, and propane savings

to common units

• Encourages energy optimization by

providing holistic view of tradeoffs such as

electrification

NAPeak kW

savings

• Measures savings from both active and

passive demand reduction

New York: Incenting Key Outcomes

• Under REV, New York seeks to:

• Transition from cost-of-service to performance-based ratemaking

• Provide incentives (earning adjustment mechanisms or EAMs) to utilities for achieving desired outcomes

• New Efficiency New York plan includes both EE and heat pump adoption as key components of statewide 185 TBtu by 2025 savings target

Efficiency Vermont Future Vision

• Proposing new performance goals for 2021-2023 period:

• Flexible kW

• GHG reduction

Key Points✓ Energy efficiency is evolving from a reliance on widgets like lighting to

data-driven, system-level strategies

✓ While EE is getting more expensive due to the lighting transition, it is

still highly cost-effective and there is plenty of savings left to capture

✓ EE and DERs can be integrated to meet both customer and grid needs

✓ Efficiency programs know how to engage contractors, design programs,

and provide technical assistance. Customers are now navigating an

increasingly complex energy landscape and these skills are needed

more than ever

✓ To realize the potential, success metrics for EE programs may need to

evolve

Thank you!Thank you!Thank you!Emily Levin

Managing Consultant, Energy Programs

802-540-7694

elevin@veic.org