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All Cost-Effective Conservation: Developing a New Conservation Framework

All Cost-Effective Conservation: Developing a New Conservation Framework for Ontario’s Natural Gas Utilities. July 2014. Disclaimer.

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All Cost-Effective Conservation: Developing a New Conservation Framework

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  1. All Cost-Effective Conservation: Developing a New Conservation Framework for Ontario’s Natural Gas Utilities July 2014

  2. Disclaimer The views and ideas expressed in this presentation are presented by the Toronto Atmospheric Fund to support the discussion around developing a new gas DSM policy framework. We welcome your views about these or other issues related to natural gas conservation policy in Ontario http://www.toronto.ca/taf/index.htm

  3. Terminology • Conservation • = • Energy Efficiency • = • Demand-Side Management (DSM)

  4. Context • Ontario’s “Conservation First” commitment in the Long Term Energy Plan • Ontario’s 2007 Action Planon Climate Change • Minister of Energy’s Directive to OEB

  5. Process • OEB DSM Working Group • Draft DSM Guideline document expected mid-August • Opportunity to submit comments

  6. Key Objectives • Enable all cost-effective energy efficiency • Achieve greenhouse gas reductions • Be cost-effective • Be fair • Enable improved quality of living in buildings& improved business productivity

  7. Challenges & Opportunities • Investing in DSM can raise rates but will deliver bill savings • Maximizing participation is key to stakeholder benefit from DSM • Minimizing impact on low-income consumers

  8. Bill Benefits Exceed Rate Impacts • Non-participants experience rate impacts •  Therefore, increase participation (i.e. pursue all cost-effective DSM)

  9. Key Design Elements • Ambitious savings targets and budgets • Aim for all cost-effective energy efficiency • i.e. > 1% total gas sales annually • Reflect bottom-up DSM potential studies and the experience of jurisdictions with similar goals • i.e. minimum $200 million/year for Ontario

  10. Key Design Elements • Cost-effectiveness calculation should: • Treat costs and benefits symmetrically • i.e. include costs andbenefits for ___each perspective examined • Account for government policies/priorities • e.g. address GHG emissions (carbon price) and ___low-income impacts.

  11. Key Design Elements • Incent & reward utility performance • DSM should be at least as profitable as supplying gas. • Award incentives for high performance based on clear metrics • Evaluate DSM program impacts at least every three years (allocate ~ 3% of DSM budgets)

  12. Key Design Elements • Integrate gas and electricity DSM programs • Can lower costs, enhance reach, improve market clarity, and lower transaction costs for consumers. • Require utilities to report on collaborations • Fuel switching should be required where cost-effective and reduces GHGs

  13. Is DSM Worth It? • Achieving all cost-effective conservation has multiple benefits: • Reduces GHGs (fast, cheap) • Cheaper than supply-side • Helps manage energy bills • Green and local jobs • Better homes & buildings

  14. Have Your Say • For more information: To participate: • Toronto Atmospheric Fund Ontario Energy Board • Julia Langer Josh WasylykChief Executive Officer OEB Advisor416-392-0253416-440-7723jlanger@tafund.orgJosh.Wasylyk@OntarioEnergyBoard.ca • Rebecca MallinsonTAF Policy Researcher 416-393-6367rmallinson@tafund.org • TAF webinar available at:http://www.towerwise.ca/ontarios-natural-gas-conservation-framework/

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