Beyond Supply Curves

Panel: Energy and Environmental Policy: Planning for Greater Impacts

Authors:
Fred Gordon, Energy Trust of Oregon
Lakin Garth, Energy Trust of Oregon
Tom Eckman, Northwest Power and Conservation Council
Charlie Grist, Northwest Power and Conservation Council

Abstract

Utility resource planners use estimates of the available energy efficiency resources to choose how much conservation to fund, and how much fossil generation and transmission and distribution construction can thus be deferred. To deal with an initially skeptical utility industry, conservation supply estimation techniques have primarily focused on efficiency measures that work and are commercially available. Estimates of savings, cost, and date of entry for individual “near-commercial” conservation have not been accurate and perhaps cannot be given the stopstart nature of product innovation. While conservation is now well established as a resource in many states, the authors wondered if the standard estimation methods produce systematically low estimates of savings available over a 20 year period. We sought a method of forecasting savings that incorporates market and program innovations. We reviewed the history of estimates for several conservation measures and concluded that aggressive program activities tend to help prompt development of consensus techniques to measure efficiency, and accelerate technology innovation and price declines. Thus, the idea that we forecast conservation economics and then make choices to fund cost-effective measures is only partly true. It appears that conservation program entities fund measures and develop programs, and then the affordability, measurability and volume of savings often improves progressively over several years. As policy makers are asking how we can get more conservation faster, the answer may depend on whether we are willing to make technology and program development investments with less certain and longerterm payoffs in energy savings.