Emerging issues in the evaluation of energy-efficiency programs: the US experience

The evaluation, measurement, and verification (EM&V) of energy-efficiency programs has a rich and extensive history in the United States, dating back to the late 1970s. During this time, many different kinds of EM&V issues have been addressed: technical (primarily focusing on EM&V methods and protocols), policy (primarily focusing on how EM&V results will be used by energy-efficiency program managers and policymakers), and infrastructure (primarily focusing on the development of EM&V professionals and an EM&V workforce). We address the issues that are currently important and/or are expected to become more critical in the coming years. We expect many of these issues will also be relevant for a non-US audience, particularly as more attention is paid to the reliability of energy savings and carbon emissions reductions from energy-efficiency programs.     

Utilities and solar energy: Emerging legal issues

As recently as 1978, discussion of utilities and their relationship to solar energy systems consisted largely of hypotheticals and speculation. Since that time the subject has undergone dramatic changes. Several substantial federal programs have been adopted, notably the Residential Conservation Service and the Public Utility Regulatory Policies Act. Several states have initiated new programs. California, for example, has directed its largest utilities to finance 375,000 solar water heaters over the next three years, while North Carolina has ordered the state's utilities to finance the creation of an independent agency to promote the use of renewable energy. At a policy level, there is a growing consensus that utilities should undertake at least some conservation and solar programs. The questions have been narrowed but not resolved; utility programs will move forward, but their scope and content are still ill defined. This paper summarizes legal issues and decisions on utility programs and solar energy, with emphasis on recent developments. Some effort has also been made to identify issues that have not been discussed at length elsewhere.     

Domestic micro-generation: Economic,regulatory and policy issues for the UK

Micro-generation in individual homes has been the subject of increasing policy and industry attention in recent years. Whilst it has been estimated that micro-generation could meet 30–40% of UK electricity demand by 2050, deployment to date has been slow. In its Micro-generation Strategy the UK government has started to outline how deployment could be increased. Various technical, economic, behavioural and institutional changes are needed to establish a UK market for micro-generation. This article discusses how different deployment models for domestic micro-generation might attract investments in these technologies. It considers not only investments by individual households but also by energy companies. Starting from an economic analysis of payback times for three different technologies (micro-CHP, micro-wind and solar PV) it identifies policy and regulatory recommendations. It argues for technology-specific support policies in the short term. It also suggests that a ‘level playing field’ for micro-generation technologies as a result of fiscal and market reforms could considerably increase the attractiveness of micro-generation technologies.     

Energy rebound and economic growth: A review of the main issues and research needs

Contrary to conventional wisdom, more efficient use of energy may actually through rebound effects lead to greater instead of less total consumption of energy—or at least to no diminution of energy consumption. If so, energy efficiency strategies may serve goals of raising economic growth and affluence, but as an environmental or energy policy strategy could backfire, leading to more resource use in absolute terms rather than less. This, in turn, could in the long run hamper economic growth, for instance if resource scarcity crowds out technical change. The hypothesis that rebound is greater than unity (‘backfire’) predicts the observed real-world correlation between rising energy consumption and rising efficiency of energy services, however difficult it may be to define a precise holistic metric for the latter. The opposing hypothesis, i.e. that rebound is less than unity and that energy efficiency increases therefore result in less energy consumption than before, requires on the other hand strong forces that do account for the empirically observed economic growth. This paper summarises some of the discussions around the rebound effect, puts it into perspective to economic growth, and provides some insights at the end that can guide future empirical research on the rebound topic.     

Emission trading schemes: potential revenue effects, compliance costs and overall tax policy issues

The case for the imposition of carbon (emission) taxes or tradable carbon permits in important tax jurisdictions is arguably strong, based upon the polluter pays principle first proposed by Pigou almost a century ago. This paper briefly reviews the arguments for and against these market-based instruments, and discusses their relative advantages and disadvantages in a practical context. In the case of Australia, the revenue effect of the proposed tradable carbon permits scheme is estimated to be A$11.5 billion in 2010–11. For comparison, this is roughly equivalent to a quarter of the revenue from the Goods and Services Tax. The paper focuses on three neglected aspects of climate change taxation discussion to date: how much tax revenue is likely to be raised, and the administrative and compliance costs of an emissions trading scheme, with particular reference to Australia. In discussing these issues, the paper draws upon selected and relevant international experience, particularly the European Union emissions trading scheme. The challenges of an emissions trading scheme, including integration with the existing tax system, particularly in an Australian context, are also discussed. The paper concludes by emphasising the key challenges and issues facing this ‘ultimate externality’ debate, particularly from a taxation policy perspective.     

Supply elasticity matters for the rebound effect and its impact on policy comparisons

We develop a model of the rebound effect which explicitly accounts for both the demand and supply sides of the energy sources. We consider a transportation sector originally using a “dirty” (fossil) fuel and examine the relative effectiveness of alternative policies: efficiency improvements in the dirty fuel technology sector (e.g., CAFE standards) and technology shifts by partial adoption of a new clean technology (e.g., low-carbon fuel standards). The model generates endogenous equilibrium quantities and prices for the dirty and clean fuels. We characterize the magnitude of the rebound effect as a function of demand and supply elasticities and use the equilibrium values to compare policy options. When the supply of the dirty fuel is inelastic, we find that introducing a new technology with non-zero emissions may actually increase the total level of emissions, similar to the leakage effect. A technology shift policy can perform better than an efficiency improvement policy in the dirty fuel sector only when the dirty fuel supply is sufficiently elastic, the emission intensity of the new technology very low, and the technology shift is greater than a threshold value. Using data for gasoline (as a proxy for the dirty technology) and several other cleaner technologies, we show that these conditions are satisfied by a hypothetical zero-emission technology, but not by electric vehicles using the average US generation mix or the current US corn based E85. Our results demonstrate the importance of accounting for the supply side in estimating the magnitude of the rebound effect and its impact on fuel consumption in a large-scale policy implementation.     

US energy policy evaluation: some analytical approaches

Evaluating all the implications of specific changes in energy policy requires a comprehensive analysis of the complex interactions and interrelationships of energy supply, demand and prices. In this article, the authors discuss the general use of analytical approaches to energy policy evaluation and review specifically some of the techniques in the Total Energy Resource Analysis (TERA) model which has been developed for the US gas industry to assist in evaluating policy issues relative to gas supply and demand.     

Evaluating the direct and indirect rebound effects in household energy consumption behavior: A case study of Beijing

This paper examines whether increases in energy efficiency of major household items cause additional short-run utilization of these end uses and other end uses for households in Beijing. An integrated model is first developed by combining a Logit model and a resource allocation model, where the former represents the choice of end-use ownership and the latter describes the end-use usage. The rebound effects are finally obtained from calculating the own- and cross-elasticities based on the prediction. The empirical results show that for refrigerators, electric fans, gas showers, TVs, and PCs, no evident rebound occurs; while for air conditioners, clothes washers, microwave ovens, and cars, either a direct rebound effect or an indirect rebound effect exists significantly. The respective average upper bound of direct rebound effects for them are 60.76%, 106.81%, 100.79%, and 33.61%, suggesting a possibility of backfire for the clothes washers and microwave ovens, while the respective upper bound of total rebound effects are 88.95%, 100.36%, 626.58%, and 31.61%. Furthermore, increasing the efficiency of air conditioners and cars can definitely reduce the total household energy consumption during the use phase.     

International policy issues regarding solar water heating, with a focus on New Zealand

Like many countries New Zealand is moving towards renewable energy targets and has recently (November 2006) announced a revised solar hot water heating subsidy program that is being implemented through the Energy Efficiency and Conservation Authority (EECA). This paper describes the new program and reviews international policies regarding solar water heating to see which aspects have been effective in gaining an increased penetration of solar systems for water heating. In addition, the factors leading to successful policy implementation and the possible downsides of the 2006 New Zealand policy are discussed with regard to international experience.     

超声-回弹法及钻芯法在石头河东干渠东滑峪渡槽检测中的应用

渡槽是一种常见的水工建筑物,目前服役的渡槽多数普遍存在设计标准低、施工质量差、老化失修现象,且没有考虑抗震要求,需要进行加固改造,本文通过对东滑峪渡槽用超声-回弹综合法,结合钻芯法进行各类构件的长龄期混凝土强度现场测试,两种方法测试的结果得到了相互印证,为结构的安全验算以及抗震加固设计提供科学依据。     

The rebound effect,gender and social justice: A case study in Germany

Energy efficiency increases are essential in reducing energy consumption and CO₂ emissions. Policy is therefore rightly concerned about rebound effects, which cause energy and CO₂ emission reductions to be less than anticipated. A policy dilemma is emerging in that less economically privileged groups tend to show the highest rebound effects. Some studies suggest policymakers may therefore be reluctant to support energy efficiency upgrades among such groups. This paper argues this is based on a misunderstanding of the conceptual structure of the rebound effect. Firstly, a mathematical analysis confirms that the rebound effect is merely a comparison of proportions, not a measure of absolute levels of energy consumption, which are the real cause of increased CO₂ emissions. Secondly, an empirical study of commute distances in North-Rhine-Westphalia, Germany’s largest state, reveals that female commuters show considerably higher rebound effects than male commuters, both in time and cross-sectional analyses. However, male commuters consume the most energy and produce the most CO₂ emissions, by every measure. This resonates with recent studies showing the same disjunction between rebound effects and absolute consumption, in home heating among poorer and wealthier households. Policy needs to focus on absolute consumption levels and be cautious in interpreting rebound effects.     

Energy efficiency, rebound effects and the environmental Kuznets Curve

Technological change is one factor used to justify the existence of an Environmental Kuznets Curve, and technological improvements have been argued to be a key factor in mitigating the impacts of economic growth on environmental quality. In this paper we use a CGE model of the Scottish economy to consider the factors influencing the impacts of one form of technological change–improvements in energy efficiency–on absolute levels of CO2 emissions, on the carbon intensity of the economy (CO2 emissions relative to real GDP), and the per capita EKC relationship. These factors include the elasticity of substitution between energy and non-energy inputs, responses in the labour market and the structure of the economy. Our results demonstrate the key role played by the general equilibrium price elasticity of demand for energy, and the relative influence of different factors on this parameter.     

Distributed generation: definition,benefits and issues

This paper starts from the observation that there is a renewed interest in small-scale electricity generation. The authors start with a survey of existing small-scale generation technologies and then move on with a discussion of the major benefits and issues of small-scale electricity generation. Different technologies are evaluated in terms of their possible contribution to the listed benefits and issues. Small-scale generation is also commonly called distributed generation, embedded generation or decentralised generation. In a final section, an attempt is made to define the latter concepts more precisely. It appears that there is no consensus on a precise definition as the concept encompasses many technologies and applications.     

A Danish case: portfolio evaluation and its impact on energy efficiency policy

A political agreement from 2005 stated that an evaluation of the entire Danish energy efficiency policy portfolio must be carried out before the end of 2008, with the aim to assess the following: (1) Is the policy portfolio sufficient to meet the energy efficiency targets? (2) Do the policies enable the national goals to be met in a cost-effective manner? (3) Is the overall design of the policy portfolio appropriate? The evaluation gave recommendations on how to improve and develop the portfolio, mainly using cost-effectiveness as criteria. The evaluation was completed in December 2008, and this paper presents the main findings and the subsequent impact on Danish policy. A key lesson learned is the importance of including all energy efficiency policies in the evaluation. Examining the entire portfolio of policies (as opposed to only selected policies) gave way to findings that would otherwise not have been captured. With its broad perspective, the evaluation found that the policy instruments prioritised the commercial and industrial sectors less than the household and public sectors. The recommendations made by the authors contributed to the implementation of new taxes for the commercial and industrial sectors together with the reform of the Electricity Saving Trust to a Centre for Energy Savings charged with energy savings within all sectors, except transport—both which have been important steps towards a more cost-effective solution.     

Biomass cofiring: economics, policy and opportunities

The US Department of Energy (DOE), Electric Power Research Institute (EPRI) and utilities are evaluating, testing and applying technology that can give a new, and potentially profitable, mission to existing coal-fired power plants. The oldest of all fuels, wood, and the old original fuel of the industrial revolution, coal, are key to this move to a new mission. Technical issues that can lead to doubt about, or outright rejection of, wood (or biomass) cofiring are, in fact, being resolved through testing and experience. DOE, EPRI and utilities have joined to cosponsor tests in full-sized boilers and design/cost/supply studies related to these tests. Economic calculations, based on the measured performance and on cost estimates confirmed in purchases for the tests, are presented in this paper. The technical feasibility is proved. The constraints are identified. So far, the profits are in the future. Policy changes that produce stronger economic incentives could make profit possible today, and enable this low-cost form of renewable power to be deployed. But, without the policy, or market, change, the economic barrier is a strong one, when biomass cofiring must compete with low-cost coal at low fuel cost and with low-capital-cost gas turbine combined cycle power plants. The economics would not be a barrier at all if biomass cofiring were in competition against moderate-velocity wind power or solar PV power.     

Resource externalities and the persistence of heterogeneous pricing behavior in an energy commodity market

In competitive product markets, repeated interaction among producers with similar economic characteristics would be expected to result in convergence of their behaviors. If convergence does not occur, it raises fundamental questions related to the sustainability of heterogeneous competitive strategies. This paper examines the prices submitted to the British wholesale electricity market by four coal-fired plants, separately owned, approximately of the same age, size and efficiency, and located in the same transmission network zone. Due to the repetitive nature of the spot market, one would expect convergence in strategies. Yet, we find evidence of persistent price dispersion and heterogeneous strategies. We consider several propositions for these effects including market power, company size, forward commitments, vertical integration and the management of interrelated assets.     

The European climate change program: An evaluation of stakeholder involvement and policy achievements

In order to step up its efforts in reducing climate change, the European Commission (hereafter: the Commission) has launched in June 2000 its European climate change program (hereafter: ECCP). This wide-ranging stakeholder consultation aimed at identifying and developing all elements necessary for a European climate change strategy. The ECCP formally came to a close in April 2003.     

External determinants for the adoption of stationary fuel cells—Infrastructure and policy issues

This paper investigates the relevance of external determinants for the adoption of stationary fuel cells (FCs) by different user groups with respect to the marketability of this innovative technology. FCs allow electricity and heat to be decentrally generated in an energy-efficient and potentially environmentally friendly manner. European energy policy is undertaking efforts to increase the proportion of combined heat and power (CHP) plants. A series of studies have spoken of their considerable market potential. A qualitative study was conducted with six focus groups consisting of 49 commercial users and six focus groups with 54 private consumers. The results of the study show that the specific infrastructure required for decentralisation and policy issues are highly relevant for the user adoption of FCs. Security of supply when energy generation is more strongly decentralised, reliable maintenance of the system, and clear political objectives are examples of factors that are considered essential prerequisites for the adoption of this technology.     

Thermal decomposition behavior,characterization and evaluation of pyrolysis products of agricultural wastes

Thermal decomposition behavior during pyrolysis, the composition and the physicochemical characteristics of the pyrolysis products were studied for four agricultural wastes from Southern Greece. These wastes are produced in abundance in the Mediterranean Region but still remain relatively unexploited, while there is also lack or little relevant scientific information. Pyrolysis process for the examined samples was studied using a TGA analyzer and a properly tested and calibrated TG/MS setup, at a heating rate of 10 °C/min up to 850 °C. Determination of important quantitative parameters of pyrolysis as a function of temperature, on an instantaneous or integral basis, and correlation of the evolved gas results with the degradation of pseudocomponents of raw biomass was made possible. The average higher heating value of the pyrolysis light gases was found to be in a satisfactory for energy purposes range of 11.2–14.4 MJ/Nm³. Furthermore, biochars produced at 450, 550 and 650 °C in a fixed bed reactor were found to exhibit calorific value ranging from 20.1 to 28.7 MJ/kg and structural stability. They were also found to have a high nutrients content and below limits or negligible heavy metals content for soils applications, regardless of production temperature.     

Grain and cellulosic ethanol: History,economics, and energy policy

The United States (US) and Brazil have been the two leading producers of fuel ethanol since the 1970s. National policies have supported the production and use of ethanol from corn and sugarcane. US support in particular has included exemption from federal gasoline excise taxes, whole or partial exemption from road use (sales) taxes in nine states, a federal production tax credit, and a federal blender's credit. In the last decade the subsidization of grain-based ethanol has been increasingly criticized as economically inefficient and of questionable social benefit. In addition, much greater production of ethanol from corn may conflict with food production needs. A promising development is the acceleration of the technical readiness of cellulosic alcohol fuels, which can be produced from the woody parts of trees and plants, perennial grasses, or residues. This technology is now being commercialized and has greater long-term potential than grain ethanol. Cellulosic ethanol is projected to be much more cost-effective, environmentally beneficial, and have a greater energy output to input ratio than grain ethanol. The technology is being developed in North America, Brazil, Japan and Europe. In this paper, we will review the historical evolution of US federal and state energy policy support for and the currently attractive economics of the production and use of ethanol from biomass. The various energy and economic policies will be reviewed and assessed for their potential effects on cellulosic ethanol development relative to gasoline in the US.