From the Lab to the Marketplace (1995)

Partnering with Electric and Gas Utilities

LBNL has authored two handbooks to help gas and electric utilities incorporate energy efficiency and other least-cost strategies into the traditional planning process. The handbooks were prepared at the request of the National Association of Regulatory Utility Officials (NARUC).

The nation's electric and gas utilities spend $2-3 billion each year on energy-efficiency programs. Their investment leverages another $1 billion in private investment, and creates jobs and markets for new, energy-efficient technologies. With utility companies expected to spend a total of $20 billion on energy programs during the 1990s, the cumulative effect of these programs will be to offset the 20-30% of expected load growth during the decade with economic benefits of $40-$50 billion. An emerging possibility is a slowdown in utility demand-side management (DSM) efforts, which may hamper their ability to achieve these projections. Whether or not utilities meet their goals will depend on regulatory trends across the country and other driving factors, including environmental goals and new competitive dynamics among energy suppliers.

For some years, LBNL has worked closely with a number of utility companies, their national trade associations (the Electric Power Research Institute and the Gas Research Institute), and especially, state regulatory utility commissions and the National Association of Regulatory Utility Commissioners. LBNL's energy-efficiency programs have aided in the development of new methodologies of energy-demand forecasting, evaluation of the impact of energy- efficient technologies on utilities, and market-based programs that utilities initiate to deploy those technologies. LBNL researchers pioneered the procedures for making "conservation potential" studies, which are now used routinely by many utilities around the nation. Other work has supported the national trend toward utility regulatory reforms that redefines utility profit rules to decouple profitability from sales volumes. This approach is intended to motivate utilities to market programs that lead to energy savings.

The utilities team has authored definitive "primers" on integrated resource planning (IRP) for gas and electric utilities, which have been translated into several languages. Their other activities include operating the Advanced IRP Seminar for regulatory staff and providing independent review of energy savings estimates of utilities, for example for the energy commissions of California, Wisconsin, and Michigan.

In the mid 1980s, LBNL researchers began investigating electricity use and energy-saving opportunities for computers and office equipment. At about 30 TWh, equivalent to the power produced by twenty-four 250-megawatt power plants, office equipment today represents the fastest-growing electricity load in commercial buildings. The savings potential is 25-50%, much of which is achievable at little or no cost by switching idle equipment to a "sleep" mode. LBNL studies, in collaboration with electric utilities, EPRI, international groups, and industry provided the technical basis for EPA's successful "Energy Star" labeling program for office equipment.