Energy Efficiency and CO 2 Reductions

1. Energy Efficiency and CO2 Reductions APPA Energy & Air Quality Task Force April 27, 2010 J.P. Blackford Environmental Services Engineer American Public Power Association

2. Introduction / Outline • Looking only at End-Use (Customer) Energy Efficiency • Estimates of Potential CO2 Reductions • Current Studies • Challenges / Next Steps / How to Measure • State Program Example – Minnesota (Larry Johnston, SMMPA)

3. Energy Efficiency and CO2Reductions • EPA’s National Action Plan for Energy Efficiency: “Energy efficiency should be a cornerstone of energy and/or climate policies at all levels of government, based on its proven status as a cost-effective option for reducing CO2 emissions and reducing the cost of climate policies.” “Efficiency is also a large and low-cost carbon abatement resource. If tapped in substantial quantities, efficiency can help achieve CO2 emissions reduction goals and lower the costs of doing so—whether or not specific climate policies are in effect.”

4. Available at: http://www.epa.gov/rdee/documents/ee_and_carbon.pdf

5. Recent Studies on EE and CO2 Reductions • EPRI’s PRISM analysis • Report does not specify exact emissions impacts by technology type, interpretation of report graphics by EPA indicates that efficiency would reduce 2030 CO2 emissions by 200 to 300 million metric tons in 2030. • See Graph on next slide • Report available at: http://mydocs.epri.com/docs/public/000000000001019563.pdf

6. EPRI PRISM Analysis

7. Recent Studies on EE and CO2 Reductions • McKinsey Analysis (2007) • McKinsey has developed several carbon abatement cost curves that highlight the leading role of energy efficiency in low-cost abatement strategies • Mid-range cost curve shows that roughly 1 billion tons of CO2 emissions reductions are available annually in the 2030 timeframe through energy efficiency technologies • Energy efficiency technologies account for most of the lowest-cost resource options • Report available at:http://www.mckinsey.com/clientservice/ccsi/pdf/US_ghg_final_report.pdf • McKinsey Report (2009): “Unlocking Energy Efficiency in the U.S. Economy” http://www.mckinsey.com/clientservice/electricpowernaturalgas/downloads/us_energy_efficiency_full_report.pdf

8. McKinsey 2007 Analysis

9. Recent Studies on EE and CO2 Reductions • IPCC • The IPCC’s mitigation working group developed substantial analysis on energy efficiency and carbon abatement potential • Their report shows that more than 2.5 gigatons of CO2emissions reductions are available through end-use energy efficiency in the countries belonging to the Organisation for Economic Co-operation and Development (OECD), at costs less than $20 per ton of CO2. • Caution: This is a GLOBAL study, not just U.S. Based • Report Available at: http://www.ipcc.ch/pdf/assessment-report/ar4/wg3/ar4-wg3-spm.pdf

10. Recent Studies on EE and CO2 Reductions • American Solar Energy Society (ASES) (2007) • ASES report shows energyefficiency accounts for 57 percent of the 1.2 billion tons of carbon equivalents that the study finds could be achieved by 2030. • Report: Tackling Climate Change in the U.S.: Potential Carbon Emissions Reductions From Energy Efficiency and Renewable Energy by 2030. http://ases.org/images/stories/file/ASES/climate_change.pdf

11. Recent Studies on EE and CO2 Reductions • Scenarios for a Clean Energy Future (CEF) • Interlaboratory Working Group, prepared for the U.S. Department of Energy in 2000 • Study projected carbon emissions and reductions out to 2020. In its advanced scenario, with maximum reductions of 565 million tons of CO2in 2020 across a range of policies, energy efficiency accounted for 65 percent of total emissions reductions. • The CEF study projected investment costs of $82 billion in 2020, offset by energy bill reductions of $189 billion, for a net economic benefit of $107 billion. • Available at: http://www.ornl.gov/sci/eere/cef/

12. Energy Efficiency and the Benefits for CarbonDioxide Reduction in the United States – AnAnalysis Using the MARKAL Model http://www.docstoc.com/docs/28843570/Energy-Efficiency-and-the-Benefits-for-Carbon-Dioxide-Reduction

13. “A LONG TERM CO2 REDUCTION PLAN”For Miami-Dade County, Florida http://www.miamidade.gov/derm/library/air_quality/CO2_Reduction_Final_Report.pdf

14. What’s Next • Measurement & Verification • Deemed Savings • Measurement • Translate Energy Savings to CO2 Savings • Fuel Mix • What Fuel Use is being offset? • EPA Guidance Document (2004) & Berkeley National Lab Study (2000) • Permanent Savings?

16. Available at: http://www.epa.gov/ttncaaa1/t1/memoranda/ereseerem_gd.pdf

17. Questions J.P. Blackford Environmental Services Engineer 202-467-2956 JPBlackford@APPAnet.org