Measuring the savings from energy efficiency policies: a step beyond program evaluation

Recent worldwide events are producing growing agreement that rapid, large-scale energy efficiency is a necessary, feasible, and economical way of reducing the need for new energy supplies. Yet, many obstacles must be overcome for commitments to energy efficiency to be successful, perhaps none more important than measuring policy-related energy savings. To address this topic, this paper provides several examples of how readily available MWH sales data can be employed to monitor and verify energy efficiency policies and detect changes in trends at the state and utility levels. The analyses used for this kind of savings verification are collectively referred to in this paper as counterfactual simulation. The goal of this paper is to demonstrate the practicality and value in using standardized research designs and econometric models to inform energy efficiency policymakers and the public as to the benefits of energy efficiency policies.     

Strategies and policies for improving energy efficiency programs: Closing the loop between evaluation and implementation

Program implementers often use evaluation results to improve the performance of their programs, but, as described in this paper, this is not always the case. Based on a review of the literature, participation in workshops, and interviews with over 50 program implementers, evaluators, and regulators in the United States and Canada, the utilization of evaluation results is investigated by asking the following questions: (1) How are program evaluation results used by program implementers and other stakeholders? (2) How are program evaluation results communicated to program implementers and other stakeholders? (3) Are the needs of program implementers being met by program evaluation? (4) What is the role of the utility regulator in facilitating the use of program evaluation results? (5) What other mechanisms can facilitate the use of program evaluation results? While there is some consensus on the answers to these questions, the type of interest in and use of evaluation varies by functional role (e.g., evaluator versus implementer), maturity of the energy efficiency market, institutional context (e.g., evaluation and implementation conducted inside the same organization, or evaluation and implementation conducted by separate entities), and by regulatory demands and evaluation interests.     

Interaction effects of energy efficiency policies: a review

Increasing energy efficiency and savings will play a key role in the achievement of the climate and energy targets in the European Union (EU). To meet the EU’s objectives for greenhouse gas emission reductions, renewable energy use and energy efficiency improvements, its member states have implemented and will design and implement various energy policies. This paper reviews a range of scientific articles on the topic of policy instruments for energy efficiency and savings and evaluates the strengths and weaknesses of different measures. The review demonstrates the variety of possible instruments and points to the complex policy environment, in which not a single instrument can meet the respective energy efficiency targets, but which requires a combination of multiple instruments. Therefore, the paper in particular focuses on assessing potential interactions between combinations of energy efficiency policies, i.e. the extent to which the different instruments counteract or support one another. So far, the literature on energy efficiency policy has paid only limited attention to the effect of interacting policies. This paper reviews and analyses interaction effects thus far identified with respect to factors that determine the interaction. Drawing on this review, we identify cases for interaction effects between energy efficiency policies to assess their potential existence systematically and to show future research needs.     

Potential impact evaluation: an ex ante evaluation of the Mediterranean buildings energy efficiency strategy

The building sector is among the largest energy users while offering cost-effective means of reducing energy use. Dynamics of energy efficiency improvements in the building stock are very slow due to the long life span of buildings and barriers such as high investment cost. A list of general policy measures to overcome the barriers to energy efficiency improvements in the Mediterranean (MED) area was proposed by regional experts in the framework of the MARIE project. These measures could be considered as a first draft of the MED buildings energy efficiency strategy. This study assesses the potential impacts of such measures, so as to inform on their effectiveness. The MARIE measures result in larger energy savings than an equally ambitious strategy based on ‘conventional measures’. However, the benefits of MARIE arrive slowly and show large variations among regions depending on the characteristics of their current building stock.     

Evaluating the risks of alternative energy policies: a case study of industrial energy efficiency

Numerous studies have shown the potential for US manufacturing to cut its energy costs by installing more efficient equipment that offers competitive payback periods, but the realization of this potential is hindered by numerous obstacles. This paper evaluates seven federal policy options aimed at revitalizing US manufacturing by improving its energy economics while also achieving environmental and energy reliability goals. Traditionally, policy analysts have examined the cost-effectiveness of energy policies using deterministic assumptions. When risk factors are introduced, they are typically examined using sensitivity analysis to focus on alternative assumptions about budgets, policy design, energy prices, and other such variables. In this paper, we also explicitly model the stochastic nature of several key risk factors including future energy prices, damages from climate change, and the cost of criteria pollutants. Using these two approaches, each policy is "stress tested" to evaluate the likely range of private and social returns on investment. Overall, we conclude that the societal cost-effectiveness of policies is generally more sensitive to alternative assumptions about damages from criteria pollutants and climate change compared with energy prices; however, risks also vary across policies based partly on the technologies they target. Future research needs to examine the macroeconomic consequences of the choice between a lethargic approach to energy waste and modernization in manufacturing versus a vigorous commitment to industrial energy productivity and innovation as characterized by the suite of policies described in this paper.     

US energy conservation and efficiency policies: Challenges and opportunities

Expanding energy conservation and efficiency in every sector nationwide is one of the most cost-effective instruments for reducing US energy imports, the trade deficit and energy’s environmental impacts. For these reasons, energy conservation and efficiency have been essential elements of US energy policy since the oil embargos and price spikes of the 1970s. The Energy Independence and Security Act of 2007 (EISA) is the latest federal legislation to expand and strengthen US energy conservation and efficiency policies, programs, and practices. Specifically, EISA and its recent predecessor, the Energy Policy Act of 2005 (EPAct05), contain almost 200 titles with new provisions for energy conservation and efficiency aimed at improvements in vehicle fuel economy. These provisions include efficiency of appliances and lighting; energy savings in residential, commercial, and government buildings; the efficiency of industrial manufacturing plants; and the efficiency of electric power delivery and end-use. These actions have begun to contribute to new federal, state, and local policies, programs, and practices across the US, and expectations are high for increases in the level of energy savings. This paper summarizes the history of US energy conservation and efficiency policies, outlines EISA’s and EPAct05’s key provisions, and considers prospects for the future.     

An energy efficiency plan for the Iranian building sub-sector

The objective of this paper is to develop a 25-year least cost plan for energy management in the Iranian building sub-sector. For this purpose, an energy flow optimization from the point where the final energy is delivered to consumers, until the useful energy and energy services point is investigated. This will help to select the most economically feasible technologies as well as energy carriers considering all technical and social constraints. Based on the optimization results, absorption cooling for the regions where natural gas network is available, grades A and B evaporative coolers and air conditioners for those areas where there is no gas service, gas fired heating systems, wall insulation, double-glazed windows, equipments and appliances with highest energy labelling grade and compact and non-compact fluorescent lamps are among the selections. The results of the sensitivity analysis indicates that if the cost of natural gas network development to the regions where there is no gas will result in the tripling rate of the actual cost of the natural gas, in those areas, the priority should be still given to the consumption of gas. The proposed energy efficiency plan results in 27%, 54% and 10% saving in energy consumption, energy cost and investment cost, respectively.     

Putting an action plan in place

In December of 2008, The U.S. Department of Energy's (DOE) Electricity Advisory Committee (EAC) delivered its "smart grid" and storage reports to Congress. They are available on the DOE Web site, and interested readers are encouraged to read the storage report. In writing the report and making its recommendations on storage for the U.S. electricity industry to the Energy Secretary, the EAC was fulfilling two objectives. The first was to counsel the Secretary of Energy and the Assistant Secretary for Electricity Delivery and Energy Reliability on implementing the Energy Policy Act of 2005, executing the Energy Independence and Security Act of 2007 (EISA), and modernizing the nation's electricity delivery infrastructure. The second objective was to fulfill the congressional requirements of EISA Section 641(e)(5)(B). According to the requirement, no later than one year after the date of the Act's enactment and every five years thereafter, the EAC, in conjunction with the Secretary, "shall develop a five-year plan for integrating basic and applied research so that the United States retains a globally competitive domestic energy storage industry for electric drive vehicles, stationary applications, and electricity transmission and distribution." The Energy Storage Technologies Subcommittee of the EAC was established in March of 2008.     

Comparative assessment of policies targeting energy use efficiency in Lithuania

Energy efficiency is an important issue of European climate policy. Energy efficiency is measured by the energy intensity of an economy showing how much energy (expressed in kilograms of oil equivalent, kgoe) is used for the production of one unit (1000 EUR) of GDP. There are huge differences between EU old and new member states. Though there are some trends of energy intensity convergence between EU member states however the achieved decrease in energy intensity is attributable mostly to a loss of energy-intensive industrial capacities in the transformation process. There is a crucial difference between whether the energy intensity of a given economy decreases as a result of downscaling energy-intensive activities or because of increased energy efficiency in activities that are maintained. It is important to make sure that this distinction is made within the policy framework which at present is not the case. The aim of the paper is to assess policies targeting energy intensity decrease in Lithuania in terms of efficiency, effectiveness and efficacy and to select the best policies able to increase energy efficiency in activities that are maintained.     

Palestine: RE action plan : Moving away from traditional energy resources

Renewable energy resources show great promise in Palestine. Solar, wind, biogas and geothermal energy resources are the main areas where research and pilot projects are being concentrated (2000–2005). More than 95% of Palestinians use solar energy for domestic water heating so renewable energy is something that many people in the country are already very aware. Consequently, use of renewable energy resources presents a strategic goal for the Palestinian energy authority in order to achieve some degree of economic independence. It aims to minimize the dependence on traditional energy resources that are too expensive and politically controlled. Awny Naim and Mohammad R Al-Agha, Palestinian Renewable Energy Society describe the current situation in the region.     

Review of policies and measures for energy efficiency in industry sector

Energy efficiency in industry plays key roles in improving energy security, environmental sustainability and economic performance. It is particularly important in strategies to mitigate climate change. The evidence of great potential for cost-effective efficiency-derived reductions in industrial energy use and greenhouse gas (GHG) emissions have prompted governments to implement numerous policies and measures aimed at improving their manufacturing industries’ energy efficiency. What can be learned from these many and varied initiatives? This paper provides foundation for policy analysis for enhancing energy efficiency and conservation in industry, by surveying more than 300 policies, encompassing about 570 measures, implemented by governments in IEA countries, Brazil, China, India, Mexico, Russia and South Africa. It outlines the measures’ main features, their incidence of use, and their connections with specific technical actions and key stakeholders (i.e., how and where measures affect the energy efficiency of industry). It also examines the key features underlying the measures’ success: (1) potential to reduce energy use and CO₂ emissions cost-efficiently; (2) ease of policy development, execution and assessment and (3) ancillary societal effects.     

Industrial energy efficiency improvement through cogeneration: A case study of the textile industry in Thailand

Natural gas cogeneration presently appears to be a promising alternative to satisfy the energy utility requirement of the process industries thanks to the favorable energy policy of the Government of Thailand. In this paper, we detail a case study in a textile factory where use of gas-turbine cogeneration with a post-combustion heat recovery system is found to be the most suitable solution. This system has not only the highest thermal efficiency, but it can also provide flexibility in operation. Financial analysis of the most suitable cogeneration configuration provides the net present value (NPV), pay-back period (PBP) and internal rate of return (IRR) with values of 310 million Baht, 5.3 years and 26.6%, respectively. The thermal-matching option is not found to be attractive because the sale price of electricity to the state electric utility is not high enough to absorb the additional investment required for the prime mover. Incorporation of an absorption chiller in the cogeneration system does not bring in any additional advantage as there is no excess waste heat available in this factory.     

State renewable energy electricity policies: An empirical evaluation of effectiveness

Over the past decade, state governments have emerged as US energy policy leaders. Across the country, states are adopting policy instruments aimed at carbon mitigation and renewable energy deployment. One of the most prevalent and innovative policy instruments is a renewable portfolio standard (RPS), which seeks to increase the share of renewable energy electrification in the electricity market. This analysis evaluates the effectiveness of state energy programs with an empirical investigation of the linkage between state RPS policy implementation and the percentage of renewable energy electricity generation across states. We use a variant of a standard fixed effects model, referred to as a fixed effects vector decomposition, with state-level data from 1998 to 2006. Results indicate that RPS implementation is not a significant predictor of the percentage of renewable energy generation out of the total generation mix, yet for each additional year that a state has an RPS policy, they are found to increase the total amount of renewable energy generation. These findings reveal a potentially significant shortcoming of RPS policies. Political institutions, natural resource endowments, deregulation, gross state product per capita, electricity use per person, electricity price, and the presence of regional RPS policies are also found to be significantly related to renewable energy deployment.     

Experimentation and the evaluation of energy efficiency programs

The use of experiments— particularly randomized controlled trials (RCTs) where subjects are randomly assigned to treatment and control conditions—has rarely been applied to the process of improving the design of energy efficiency programs and, more fundamentally, to determining the net savings from energy efficiency programs. This paper discusses the use of experimentation in the energy efficiency program field with the hope of explaining how these experiments can be used, and identifying the barriers to their use will cause more experimentation to occur. First, a brief overview of experimental methods is presented. This discussion describes the advantages and disadvantages of conducting experiments in the context of the development and evaluation of energy efficiency programs. It then discusses barriers to the use of experimental methods (including cost and equity issues) and suggests some ways of overcoming these barriers. Finally, recommendations are made for implementing key social experiments, discussing the types of energy efficiency programs and issues that can make use of experimentation and variables that one might use for selecting treatments.     

Implications of an energy efficiency obligation scheme for the Swedish energy-intensive industries: an evaluation of costs and benefits

The EU Energy Efficiency Directive (EED) aims at improving energy efficiency by implementing actions in all sectors of the economy in the EU. Article 7 of the EED sets the target of 1.5 % cumulative annual energy end-use savings. An energy efficiency obligation scheme (EEO) is one of the policy mechanisms proposed to reach this target. This paper assesses the impact of implementing a Swedish EEO and the implications that such a scheme may have for Swedish energy-intensive industries. The assessment was based on cost-benefit analysis (CBA) methodology. The benefit-to-cost ratio (BCR) ranges from 1.56 to 2.17 and the break-even cost ranges from 83.3 to 86.9 €/MWh with sensitivity analyses performed for the emission allowance prices and eventual costs of the EEO. The annual energy savings potential is estimated to be 1.25 TWh/year. A Swedish EEO could motivate investments in energy efficiency measures and thus help Sweden reach the energy efficiency targets set in the EED.     

Improving energy efficiency The effectiveness of government action

Energy conservation involves the substitution of intelligence, prudence, maintenance, and better equipment for scarce, insecure, and costly energy. These substitutions improve efficiency of energy use and thereby enhance economic productivity. The benefits of conservation are clear, but the proper role for government is hotly debated. Although the normal workings of the market system are doing much to stimulate cost-effective conservation actions, several barriers to conservation still exist. Government programmes are needed to help overcome these barriers. Present US Department of Energy conservation programmes could reduce annual energy use by 2.7 quads in 1985 and by 13 quads in 2000. The present worth of the estimated cumulative oil saving over 20 years is $50 billion, in addition to the savings realized by energy consumers themselves.     

Energy policies for increased industrial energy efficiency: Evaluation of a local energy programme for manufacturing SMEs

The most extensive action targeting the adoption of energy efficiency measures in small- and medium-sized manufacturing industries in Sweden over the past 15 years was project Highland. This paper presents an evaluation of the first part of this local industrial energy programme, which shows an adoption rate of more than 40% when both measures that have already been implemented and measures that are planned to be implemented are included. A comparison between this programme and another major ongoing programme for the Swedish energy-intensive industry indicates that the approach used in project Highland aimed at small- and medium-sized industries is an effective way to increase energy efficiency in the Swedish industry. The major barriers to energy efficiency among the firms were related to the low priority of the energy efficiency issue.     

国际电动机能效政策法规研究与分析

作为生产量大、使用面广的工业通用产品之一,电动机的节能政策自诞生起就吸引了全球的关注.分析目的地国家的电动机能效政策法规已成为我国电机生产企业在从事进出口贸易过程中必不可少的环节.通过研究和介绍了世界范围内主要电动机进出口贸易地区的能效政策法规,涵盖亚洲、欧洲、北美洲、南美洲、澳洲等五大洲共计超过10个国家,覆盖面广,实用性高,适用性强.同时分析相关政策的差异和关联性.为我国相关政策的制订和完善提供技术支持.     

Securing energy efficiency as a high priority: scenarios for common appliance electricity consumption in Thailand

Between 1995 and 2008, Thailand’s energy efficiency programs produced an estimated total of 8,369 GWh/year energy savings and 1,471 MW avoided peak power. Despite these impressive saving figures, relatively little future scenario analysis is available to policy makers. Before the 2008 global financial crisis, electricity planners forecasted 5–6% long-term increases in demand. We explored options for efficiency improvements in Thailand’s residential sector, which consumes more than 20% of Thailand’s total electricity consumption of 150 TWh/year. We constructed baseline and efficient scenarios for the period 2006–2026, for air conditioners, refrigerators, fans, rice cookers, and compact fluorescent light bulbs. We drew on an appliance database maintained by Electricity Generating Authority of Thailand’s voluntary labeling program. For the five appliances modeled, the efficiency scenario results in total savings of 12% of baseline consumption after 10 years and 29% of baseline after 20 years. Approximately 80% of savings come from more stringent standards for air conditioners, including phasing out unregulated air conditioner sales within 6 years. Shifting appliance efficiency standards to current best-in-market levels within 6 years produces additional savings. We discuss institutional aspects of energy planning in Thailand that thus far have limited the consideration of energy efficiency as a high-priority resource.