northwest power and conservation council regional conservation update: news from the front january...

Northwest Power and ConservationCouncil

Regional Conservation Update:Regional Conservation Update:News From the FrontNews From the Front

January 24, 2007

Tom EckmanTom Eckman

Northwest Power and Northwest Power and Conservation CouncilConservation Council


What You’re About To HearWhat You’re About To Hear

A Short HistoryA Short History

– WhatWhat We’veWe’ve Accomplished in the past Accomplished in the past 25 years25 years

Some Current EventsSome Current Events

– How We’re Doing on the 5How We’re Doing on the 5thth Plan’s Targets Plan’s Targets

The Road AheadThe Road Ahead

– Are We In for Another “Mister Toad’s Wild Ride?”Are We In for Another “Mister Toad’s Wild Ride?”


PNW Energy Efficiency PNW Energy Efficiency AchievementsAchievements1978 – 20051978 – 2005

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Avera

ge M

egaw

att

s

1978 1982 1986 1990 1994 1998 2002

BPA and Utility Programs Alliance Programs State Codes Federal Standards

Since 1978 Utility & BPA Since 1978 Utility & BPA Programs, Energy Codes & Programs, Energy Codes & Federal Efficiency Standards Have Federal Efficiency Standards Have Produced Produced OverOver 3000 aMW of 3000 aMW of Savings.Savings.


Energy Efficiency Resources Energy Efficiency Resources Significantly Reduced Projected PNW Significantly Reduced Projected PNW

Electricity SalesElectricity Sales

14,000

16,000

18,000

20,000

22,000

24,000

1980 1985 1990 1995 2000

Avera

ge M

egaw

att

s

Medium High ForecastMedium LowMedium High Minus ConservationActual


Energy Efficiency Met Nearly 40% of Energy Efficiency Met Nearly 40% of PNW Regional Firm Sales Growth PNW Regional Firm Sales Growth

Between 1980 - 2003Between 1980 - 2003

61%

39%

Generation Conservation


Utility Acquired Energy Efficiency Has Been Utility Acquired Energy Efficiency Has Been A BARGAIN!A BARGAIN!

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100

May

-96

Nov-9

6

May

-97

Nov-9

7

May

-98

Nov-9

8

May

-99

Nov-9

9

May

-00

Nov-0

0

May

-01

Nov-0

1

May

-02

Nov-0

2

May

-03

Nov-0

3

May

-04

Nov-0

4

May

-05

Wh

ole

sale

Ele

ctri

city

Pri

ce (

20

00

$/M

WH

)

Levelized Cost of EfficiencyAcquisitionsWholesale Market Price


Regional Utility Conservation Acquisitions Have Regional Utility Conservation Acquisitions Have Also Helped Balance Loads & ResourcesAlso Helped Balance Loads & Resources

0

20

40

60

80

100

120

140

160

1978 1982 1986 1990 1994 1998 2002

Con

serv

ati

on

Acq

uis

itio

ns

(aM

W)

Response to West Coast

Energy CrisisResponse to

NW Recession

Response to “Restructuring

Discussions”

Creating Mr. Toad’s Wild Ride for the PNW’s Energy Efficiency IndustryCreating Mr. Toad’s Wild Ride for the PNW’s Energy Efficiency Industry

Short Term Memory Loss?


So What’s 3100 aMW?So What’s 3100 aMW?

It’s enough electricity to serve the It’s enough electricity to serve the entireentire state of Idahostate of Idaho and and all of Western all of Western MontanaMontana

It’s enough electricity to meet nearly It’s enough electricity to meet nearly 60% of Oregon total electricity use60% of Oregon total electricity use

It saved the region’s consumers more It saved the region’s consumers more than than $1.25 billion$1.25 billion in 2004 in 2004

It lowered 2004 PNW carbon emissions It lowered 2004 PNW carbon emissions by an estimated by an estimated 13 million13 million tons. tons.


IS THAT AS GOOD AS IT GETSIS THAT AS GOOD AS IT GETS?

With All We’ve AccomplishWith All We’ve Accomplish You Might Ask YourselfYou Might Ask Yourself

55thth Plan Relies on Conservation and Plan Relies on Conservation and

Renewable Resources to Meet Load GrowthRenewable Resources to Meet Load Growth**

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

2004 2007 2010 2013 2016 2019 2022

Cu

mu

lati

ve C

ap

acit

y (

MW

)*

Coal (ICG) (MW)

CCGTurbine (MW)

SCGTurbine (MW)

DR (MW)

Wind (MW)

Conservation (aMW)

**Actual future conditions (gas prices, CO2 control, conservation accomplishments) will Actual future conditions (gas prices, CO2 control, conservation accomplishments) will change resource development schedule and amountschange resource development schedule and amounts


Accelerating Conservation Accelerating Conservation Development Reduces Cost & Development Reduces Cost &

RiskRisk

$20

$22

$24

$26

$28

$30

$32

$34

$36

$38

$40

Option 1 - Accelerated Option 2 - Sustained Option 3 - Status Quo

NPV

(bill

ion

20

04

$)

NPV System Cost NPV System Risk


Accelerating Conservation Reduces Accelerating Conservation Reduces Carbon Dioxide EmissionsCarbon Dioxide Emissions

0

20

40

60

80

100

120

140

Option 1 -Accelerated

Option 2 -Sustained

Option 3 - StatusQuo

Cum

ula

tive E

mis

sions

(Tons)


Meeting 5Meeting 5thth Plan’s Conservation Targets Plan’s Conservation Targets Reduces Forecast PNW Power System Reduces Forecast PNW Power System CO2 Emissions in 2025 by Nearly 20%CO2 Emissions in 2025 by Nearly 20%

0

10

20

30

40

50

60

70

With 5th Plan's Conservation Without 5th Plan'sConservation

2025 C

O2 E

mis

sions

(tons)


Are We Achieving the 5Are We Achieving the 5thth Plans PlansNear-Term Conservation Targets? Near-Term Conservation Targets?

(2005-2009) = 700 aMW(2005-2009) = 700 aMW

0

20

40

60

80

100

120

140

160

2005 2006 2007 2008 2009

Resourc

e (

aM

W)

Residential - Lost Opportunity

Commercial - Lost Opportunity

I rrigated Agriculture - Non LostOpportunity

Industrial - Non Lost Opportunity

Residential - Non Lost Opportunity

Commercial - Non Lost Opportunity


Not All Not All Returns Returns

Have Been Have Been CountedCounted

62 Utilities62 Utilities88% of Regional 88% of Regional

LoadLoad

Council’s Regional Technical Forum Is Council’s Regional Technical Forum Is Surveying Utility Progress on ConservationSurveying Utility Progress on Conservation


Early Returns Show We’re Early Returns Show We’re Close on the Savings Close on the Savings

0

25

50

75

100

125

150

Savings (aMW) Savings (aMW)

Savin

gs

(aM

W)

Alliance Programs(Utility and BonnevilleFunded)

Bonneville FundedConservation

Utility FundedConservation

2005 Target 2006 Target


Conservation Appears to Be Lower Conservation Appears to Be Lower Cost . . . At Least To UtilitiesCost . . . At Least To Utilities

$152*

$0

$50

$100

$150

$200

Uti

lity E

xpendit

ure

(M

illio

n 2

000$) 55thth Plan Estimate of Utility Cost of Plan Estimate of Utility Cost of

Conservation for “share” of Target: Conservation for “share” of Target: $180 to $225 million$180 to $225 million

May Hit savings targets with May Hit savings targets with lower than expected costlower than expected cost

No data yet on levelized No data yet on levelized cost to compare to cost to compare to wholesale power costswholesale power costs

Equivalent to 1.75% of Regional Retail Revenues


Utility Cost of ConservationUtility Cost of ConservationContinue to DecreaseContinue to Decrease

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Fir

st Y

ear

Cost

/aM

W(m

illio

n 2

000$)

20

05

C

os

t R

an

ge


Are Are Individual Individual Utilities Utilities “Making “Making

Their Their Targets?” Targets?”


Caveats on Utility “Targets”Caveats on Utility “Targets”

““Targets” are based Targets” are based share of regional load, share of regional load, hence assume all hence assume all utilities look like the utilities look like the “region” – NOT SO!“region” – NOT SO!

Conservation potential Conservation potential varies due to customer varies due to customer mix, gas/electric mix, gas/electric market share, load market share, load growth,etc.growth,etc.

Utility IRPs will differ Utility IRPs will differ from Council Planfrom Council Plan

Lumpy-factor: Lumpy-factor: Annual program Annual program volume variesvolume varies

Still, many utilities Still, many utilities want to know their want to know their “share” of the regional “share” of the regional conservation targetsconservation targets


2005 Findings by Utility2005 Findings by Utility 16 Largest Utilities or 85% of Regional Loads16 Largest Utilities or 85% of Regional Loads

Four utilities far exceed targetsFour utilities far exceed targets– 15 to 35% above “share” of regional target 15 to 35% above “share” of regional target

Eight utilities fell shortEight utilities fell short– Seven achieved less than half of their “share” of Seven achieved less than half of their “share” of

regional target regional target

Four utilities within 10% of target Four utilities within 10% of target


0%

20%

40%

60%

80%

100%

120%

140%

Ener

gy T

rust

PSE

EWEB

Avist

a

Pacifi

Corp

- WA

Bento

n PU

DSCL

Snoho

mish

PUD

North

Wes

tern

(W M

T)

Pacifi

Corp

- ID

IPC

Chelan

PUD

Grant

PUD

Cowlit

z PU

D

Clark

PUD

Taco

ma

Power

Savin

gs R

ela

tive t

o 5

th P

lan

Targ

et

2005 Results2005 Results16 Largest Utilities – 85% of Regional Loads16 Largest Utilities – 85% of Regional Loads


0%

20%

40%

60%

80%

100%

120%

140%

Pacifi

Corp

- W

APS

E

EWEB

Ener

gy T

rust

Snoho

mish

PUD

SCL

Avist

aIP

C

North

Wes

tern

(W M

T)

Pacifi

Corp

- ID

Grant

PUD

Bento

n PU

D

Chelan

PUD

Cowlit

z PU

D

Clark

PUD

Taco

ma

Power

Savin

gs R

ela

tive t

o 5

th P

lan

Targ

et

2006 2006 PreliminaryPreliminary Results Results16 Largest Utilities – 85% of Regional Loads16 Largest Utilities – 85% of Regional Loads


0%

20%

40%

60%

80%

100%

120%

140%

160%

Ener

gy T

rust

Pacifi

Corp

- W

APS

E

EWEB

Avist

aSCL

Snoho

mish

PUD

Bento

n PU

D

North

Wes

tern

(W M

T) IPC

Grant

PUD

Chelan

PUD

Cowlit

z PU

D

Pacifi

Corp

- ID

Clark

PUD

Taco

ma

Power

Savin

gs R

ela

tive t

o 5

th P

lan

Targ

et

Average 2005-06 Average 2005-06 PreliminaryPreliminary Results Results16 Largest Utilities – 85% of Regional Loads16 Largest Utilities – 85% of Regional Loads


Bonneville Achieved It’s Bonneville Achieved It’s 2002-2006 Targets2002-2006 Targets

0

10

20

30

40

50

60

70

2002 2003 2004 2005 2006

An

nu

al

Acc

om

plis

hm

en

ts (

aM

W) BPA's Original FY02-FY06

Rate Period Target

BPA's Revised FY02-FY06Target (5th Plan)

BPA's Actual Achievements

BPA's Achievements(Adjusted for carry over)


However, BPA Has Exhausted However, BPA Has Exhausted Its “Surplus”Its “Surplus”

0

10

20

30

40

50

60

70

2002 2003 2004 2005 2006 2007 2008 2009

Savin

gs

(aM

W)

FY07 Achievements Must Be Nearly 50% Above FY06


With Bonneville’s “Carry Over” The Region With Bonneville’s “Carry Over” The Region

Exceeds the 5Exceeds the 5thth Plan 2005 -2006 Targets Plan 2005 -2006 Targets

0

25

50

75

100

125

150

2005 Preliminary Projected 2006

Savin

gs

(aM

W)

Alliance Programs(Utility and BonnevilleFunded)

Bonneville Conservation(Carry Over)

Bonneville Conservation

Utility Conservation

2005 Target 2006 Target


The Road Ahead – The Road Ahead – Is this the Renaissance?Is this the Renaissance?


The Road Ahead – A Brighter The Road Ahead – A Brighter Future @ Lower WattageFuture @ Lower Wattage

Over 7 million CFLs sold in 2005Over 7 million CFLs sold in 2005– PNW has 16% of all US installsPNW has 16% of all US installs

BPA has several new regional BPA has several new regional initiatives underway initiatives underway

State & Federal standards for 17 appliancesState & Federal standards for 17 appliances– Help hit targets beginning 2008Help hit targets beginning 2008

Commercial & Commercial & Industrial program Industrial program participation is upparticipation is up


The Road Ahead – Utilities The Road Ahead – Utilities Appear to Be “Ramping Up”Appear to Be “Ramping Up”

PSE is developing a “green utility” strategyPSE is developing a “green utility” strategy Avista has increased its annual efficiency Avista has increased its annual efficiency

goal by 20% -- and management has asked goal by 20% -- and management has asked staff to “squeeze out more efficiency” staff to “squeeze out more efficiency” company widecompany wide

Idaho Power expects to nearly double its Idaho Power expects to nearly double its efficiency expenditures next yearefficiency expenditures next year

PGE has initiated discussions that could PGE has initiated discussions that could lead to an increase in Energy Trust fundinglead to an increase in Energy Trust funding


I-937 PassedI-937 Passed


Now It Must Be Now It Must Be ImplementedImplemented


I-937 Failed In Most Counties Served by Public Utilities I-937 Failed In Most Counties Served by Public Utilities Who Do Not Appear to Be Achieving the 5Who Do Not Appear to Be Achieving the 5thth Plan’s Plan’s

TargetsTargets

0%

20%

40%

60%

80%

100%

120%

140%

Perc

ent

of

5th

Pla

n T

arg

et

I-937 Failed in the Counties Served by these Utilities


After A Quarter CenturyAfter A Quarter Century

ImmoralImmoral

IllegalIllegal

UnprofitableUnprofitable

The Region May Finally Achieve the The Region May Finally Achieve the Power Act’s Vision of Making the Power Act’s Vision of Making the Inefficient Use of Electricity . . .Inefficient Use of Electricity . . .


Thank Thank you very you very much. much.

Thank Thank you verry, you verry,

verry verry much.much.

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