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DNV GL © 2014 Ungraded Wednesday, March 9, 2016 SAFER, SMARTER, GREENER DNV GL © 2014 Impact Evaluation of Upstream and Residential Downstream.

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Presentation on theme: "DNV GL © 2014 Ungraded Wednesday, March 9, 2016 SAFER, SMARTER, GREENER DNV GL © 2014 Impact Evaluation of Upstream and Residential Downstream."— Presentation transcript:

1 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 SAFER, SMARTER, GREENER DNV GL © 2014 Impact Evaluation of 2013-14 Upstream and Residential Downstream Lighting Programs 1 ED_I_LTG_4 California Public Utilities Commission, Energy Division March 9, 2016

2 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Table of Contents  Introduction  Measure Quantity Adjustments  Gross Savings  NTGR and Net Savings  Alternate Gross Savings and NTGR  Recommendations 2

3 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Introduction 3

4 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Ex Ante Savings Claims 4 Ex ante net annual savings from upstream and residential downstream lighting measures, 2013-14 IOU Total PortfolioUpstream/ Residential Downstream Lighting Energy (GWh) Peak Demand Reduction (MW) Energy (GWh) Peak Demand Reduction (MW) Energy (GWh) Peak Demand Reduction (MW) PG&E1,590272148209%7% SCE1,6252622994318%16% SDG&E3285445614%11% Statewide3,5425884926914%12% Source: 2013-2014 Tracking Data Introduction  9%-18% of each IOU’s ex ante net annual energy savings were from upstream/residential downstream lighting measures

5 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Ex Ante Savings Claims 5 Source: 2013-2014 Tracking Data Statewide ex ante upstream and residential downstream lighting net savings, 2013-14 IOU / Lighting Measure Category Ex Ante Upstream and Residential Downstream Lighting Savings EnergyDemandGas Impacts GWh % of GWh MW % of MW Therms % of Therms Upstream - Evaluated470.296%66.196%-7.095% Upstream - Passed Through12.93%1.83%-0.23% Downstream - Passed Through9.22%1.12%-0.12% Grand Total – All IOUs492.4100%69.0100%-7.3100% Introduction  Evaluation focused on upstream measures, which accounted for 96% of energy and demand savings

6 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Program Overview 6 Share of upstream lighting program CFL shipments by retail channel and program period, 2010-12 and 2013-14 Source: 2013-2014 Tracking Data Introduction  The 2013-14 program was smaller than 2010-12  LED lamp share of program increased, while basic spiral CFL share decreased

7 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Program Overview 7 Evaluated Upstream Lighting Measure Group Average Incentive Amount Overall PG&ESCESDG&E MSB CFL basic spiral ≤ 30 W$0.34$0.48$0.61$0.49 MSB CFL A-lamp ≤ 30 W$2.05$2.32$1.20$2.08 MSB CFL reflector ≤ 30 W$1.45$2.52$1.43$2.14 MSB CFL globe ≤ 30 WN/A$2.77$1.47$2.53 MSB CFL high-wattage (> 30 W)$2.65$2.92$1.13$2.89 LED A-lamp, all wattages$6.16$8.59$5.00$6.59 LED reflector, all wattages$3.56$6.04$3.47$4.75 Overall$2.04$3.70$1.19$2.41 Source: 2013-2014 Tracking Data Average incentive amount per lamp by evaluated upstream lighting measure group and IOU, 2013-14 Introduction  Basic spiral discounts were relatively low, LED lamp discounts were relatively high

8 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Program Overview 8 Quarterly lamp shipments to home improvement stores by upstream lighting program measure group, 2013-14 Source: 2013-2014 Tracking Data Introduction  Availability of program-discounted lamps varied throughout the program period Example

9 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Market Context 9 Lamp Replacement Category Measure Group IOU Discounted Retail Price A-lamp Replacements MSB CFL basic spiral ≤ 30 W$0.59$3.27 MSB CFL A-lamp ≤ 30 W$0.93$5.45 Incandescent A-lampN/A$1.90 Halogen A-lampN/A$2.14 LED A-lamp, all wattages$6.92$11.16 Reflector Lamp Replacements MSB CFL reflector ≤ 30 W$1.77$5.79 Incandescent reflectorN/A$4.59 LED reflector, all wattages$7.84$18.70 Globe Lamp Replacements MSB CFL globe ≤ 30 W$1.32$5.50 Incandescent globeN/A$2.36 Source: bulbstockdata.com Average IOU-discounted and non- IOU-discounted price per lamp across retail stores by replacement lamp category, winter 2014-15 Introduction  In the presence of the program, CFLs cost the least  Without the program, inefficient lamps cost the least

10 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Market Context 10 Source: bulbstockdata.com Share of lamps in California retail stores by technology, winter 2012-13 vs. winter 2014-15 Introduction  Share of efficient/inefficient stock was consistent  Within efficient, LED share grew and CFLs dropped  Within inefficient, halogen share grew

11 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Measure Quantity Adjustments 11

12 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Three Adjustments  2013-14 evaluation relied on 2010-12 values 12 Adjustment2010-12 MethodValue Shipment quantity verification Review lamp manufacturer shipment invoices 100% Res/Non-Res Split % of program lamps purchased by res vs. nonres customers Review results from CMST and CLASS IOU Non Res PG&E 7%93% SCE 6%94% SDG&E 6%94% Leakage % of program lamps purchased by non-IOU customers Review results from shopper intercept surveys 0% Quantity Adjustments

13 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Gross Savings 13

14 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Results 14 Statewide Ex ante and ex post gross savings and realization rates, 2013-14  Gross realization rates are mostly >100% Gross Savings Measure Group Ex AnteEx Post Realization Rates GWhMW Therms (10,000) GWhMW Therms (10,000) GWhMWTherms MSB CFL basic spiral ≤ 30 W 7710-1212517-19163%170%167% MSB CFL A-lamp ≤ 30 W 8412-1211316-17134% 141% MSB CFL reflector ≤ 30 W 10214-1512918-20126%132%128% MSB CFL globe ≤ 30 W 7161 86%105%81% MSB CFL high-Watt (> 30 W) 28240-3828941-40103%104%106% LED A-lamp, all wattages 132-2203-3160% 158% LED reflector, all-wattages 395-6598-10150%141%160% Overall 60483-86741104-110123%125%128%

15 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Results 15 Statewide Ex ante and ex post gross savings and realization rates, 2013-14  Gross realization rates are mostly >100% Gross Savings

16 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Results  Gross realization rates are high because three key parameter values are higher in ex post than ex ante: 1.Delta watts 2.Installation rates 3.Nonresidential allocation in res/non-res split for many measure groups* * Exception: SCE LED lamps 16 Gross Savings

17 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Delta Watts  Ex Post calculated higher delta watts than ex ante  Lamps in the 2013-14 program had fairly low wattage  Ex ante approach – Used wattage-reduction ratio for delta watts, which yields lower deltas for lower-wattage lamps  Ex post approach – Subtracted average program lamp wattages from average baseline, which yields higher deltas for lower-wattage lamps – 2013-14 baselines: – CFL baseline = incandescent lamps – LED baseline = CFLs + incandescent lamps 17 Gross Savings

18 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Installation Rates  Ex post used higher installation rates than ex ante  The definition changed to include all lamps that are or will eventually be installed, eliminating the need for carryover going forward 18 SDG&E ex ante and ex post res and non-res installation rates, 2013-14 Gross Savings Evaluated Upstream Lighting Measure Group ResidentialNonresidential Ex AnteEx PostEx AnteEx Post MSB CFL basic spiral ≤ 30 W76%97%76%97% MSB CFL A-lamp ≤ 30 W73%97%71%97% MSB CFL globe ≤ 30 W77%97%78%97% MSB CFL reflector ≤ 30 W76%97%74%97% MSB CFL high-wattage (> 30 W)76%97%79%97% LED A-lamp, all wattages100%99%100%99% LED reflector, all wattages100%99%100%99% Example

19 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Res/Non-Res Split  Ex post generally used higher nonresidential allocation compared to ex ante, which increases ex post gross energy savings* 19 Gross Savings IOU Ex AnteEx Post ResidentialNonresidentialResidentialNonresidential PG&E94%6%93%7% SCE99%1%94%6% SDG&E95%5%94%6% Example Basic spiral CFL ≤ 30 W ex ante and ex post res/non-res split * Exception: SCE LED lamps

20 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 NTGR and Net Savings 20

21 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Results 21 Statewide net savings realization rates, 2013-14 NTGR & Net Savings  Net savings realization rates are mostly between 60% and 100%

22 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Results 22 Statewide ex ante and ex post net savings and realization rates, 2013-14 NTGR & Net Savings  Net savings realization rates are mostly between 60% and 100% Measure Group Ex AnteEx Post Realization Rates GWhMW Therms (10,000) GWhMW Therms (10,000) GWhMWTherms MSB CFL basic spiral ≤ 30 W 415-6314-575%78%75% MSB CFL A-lamp ≤ 30 W 456-67210-11158% 164% MSB CFL reflector ≤ 30 W 557-8324-557%60%57% MSB CFL globe ≤ 30 W 4141 108%133%103% MSB CFL high-Watt (> 30 W) 15221-2113019-1885%86%88% LED A-lamp, all wattages 10181 81%82%80% LED reflector, all-wattages 294-5162-356%52%59% Overall 33746-4829241-4287%89%88%

23 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Overview of Approach 23 NTGR & Net Savings

24 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Model-Based NTGR 24 NTGR & Net Savings

25 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Model-Based NTGR 25 NTGR & Net Savings  Lamp choice model predicts the probability with which a consumer would purchase different lamps within a replacement lamp category  Model-based NTGR is the difference in the measure group’s sales share with the program versus without the program as a percent of the with-program share

26 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Model-Based NTGR 26 NTGR & Net Savings Modelled share of sales for MSB CFL A-Lamp ≤ 30 W, discount channel Source: DNV GL Lamp Choice Model Example

27 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Model-Based NTGR 27 NTGR & Net Savings Lamp Replacement Category Measure Group A-lamp Replacements MSB CFL basic spiral ≤ 30 W MSB CFL A-lamp ≤ 30 W Incandescent A-lamp Halogen A-lamp LED A-lamp, all wattages Reflector Lamp Replacements MSB CFL reflector ≤ 30 W Incandescent reflector LED reflector, all wattages Globe Lamp Replacements MSB CFL globe ≤ 30 W Incandescent globe Three modelled replacement lamp categories

28 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Model-Based NTGR 28 NTGR & Net Savings  Additional model considerations – Scenarios with program – No discount (no program) – Constrained (no program) – Program activity type – Separately model choice sets with different combinations of discounted measure groups present – Weight by program shipments – Respondent counts – Rigorous data is ≥ 15 shopper intercept survey respondents

29 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Overview of Approach 29 NTGR & Net Savings

30 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Supplier-Based NTGR 30 NTGR & Net Savings  Two supplier sources: – Manufacturers – 16 participating lighting manufacturers – Represented ~99% of 2013-14 program-discounted lamps – Retail lighting buyers – 6 lighting buyers for large retail chains – Represented ~30% of 2013-14 program-discounted lamps  NTGR based on this question: – By what percentage would your sales have changed in absence of the program?

31 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Weighting of Results 31 NTGR & Net Savings

32 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Weighting of Results 32 NTGR & Net Savings  Weighted Model and Supplier NTGR – Model-based NTGR (70%) – Actual shopper insights that reflect customer characteristics – Simulations based on observed in-store prices and lamp availability – Used only with robust intercept survey sample sizes (n≥ 15) – Supplier-based NTGR (30%) – Comprehensive coverage of the lighting market – Established survey methodology used in California and elsewhere

33 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Imputation 33 NTGR & Net Savings

34 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Imputation 34 NTGR & Net Savings  Imputation factor – Average final NTGR divided by average supplier NTGR – Based on robust cases – Calculated for every measure group – When model data was insufficient (n < 15), used an imputation factor from a similar measure group  Impute from supplier NTGR – Supplier NTGR for each retail channel multiplied by the respective imputation factor

35 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Final Measure Group NTGR 35 NTGR & Net Savings

36 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Final Measure Group NTGR 36 NTGR & Net Savings  Final measure group NTGR is the weighted average of the channel-level NTGRs  Weights are based on the lamp quantities shipped to each respective channel

37 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Ex Post Net Savings 37 NTGR & Net Savings Statewide ex ante and ex post net savings and realization rates, 2013-14  Net savings realization rates are between 60% and 100% Measure Group Ex AnteEx Post Realization Rates GWhMW Therms (10,000) GWhMW Therms (10,000)GWhMWTherms MSB CFL basic spiral ≤ 30 W 415-6314-575%78%75% MSB CFL A-lamp ≤ 30 W 456-67210-11158% 164% MSB CFL reflector ≤ 30 W 557-8324-557%60%57% MSB CFL globe ≤ 30 W 4141 108%133%103% MSB CFL high-Watt (> 30 W) 15221-2113019-1885%86%88% LED A-lamp, all wattages 10181 81%82%80% LED reflector, all-wattages 294-5162-356%52%59% Overall 33746-4829241-4287%89%88%

38 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Demonstration of Approach 38 Final IOU-level NTGR for MSB CFL basic spiral ≤ 30 W, weighted by channel, 2013-14 Channel Channel NTGR Shipments Total Program Lamps PG&ESCESDG&E Discount66%250,335061,952188,383 Drug Store35%38,2022,61234,2401,350 Grocery - Chain7%16,652080015,852 Grocery - Independent55%2,1040 0 Hardware26%86,21686,1161000 Home Improvement22%2,013,099541,868586,862884,369 Mass Merchandise33%406,3428610405,482 Membership Club15%751,543410,71210,638330,193 Total Shipments 3,564,4931,042,169696,6961,825,628 Overall NTGR 20%26%27% NTGR & Net Savings Example  MSB CFL basic spiral ≤ 30 W

39 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 MSB CFL basic spiral ≤ 30 W 39 IOUAverage Discount PG&E $0.34. SCE $0.48. SDG&E $0.61. Overall $0.49. Source: 2013-2014 Tracking Data Timing of program lamp shipments, 2013-14 Channel distribution of program lamp shipments, 2013-14 Average discount by IOU, 2013-14 NTGR & Net Savings N=3,763,679

40 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 MSB CFL basic spiral ≤ 30 W 40 Modelled NTGR by channel NTGR & Net Savings Channel Modelled NTGR Discount57% Drug* Grocery - Chain* Grocery - Independent* Hardware14% Home Improvement8% Mass Merchandise* Membership Club5%

41 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 MSB CFL basic spiral ≤ 30 W 41 Modelled and supplier NTGR by channel NTGR & Net Savings Channel Modelled NTGR Supplier NTGR Discount57%84% Drug*63% Grocery - Chain*12% Grocery - Independent*100% Hardware14%54% Home Improvement8%53% Mass Merchandise*59% Membership Club5%41%

42 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 MSB CFL basic spiral ≤ 30 W 42 Modelled, supplier, and blended NTGR by channel NTGR & Net Savings Channel Modelled NTGR Supplier NTGR Model + Supplier NTGR Discount57%84%66% Drug*63%* Grocery - Chain*12%* Grocery - Independent*100%* Hardware14%54%26% Home Improvement8%53%22% Mass Merchandise*59%* Membership Club5%41%15%

43 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 MSB CFL basic spiral ≤ 30 W 43 Modelled, supplier, and blended NTGR by channel and imputation factor NTGR & Net Savings Channel Modelled NTGR Supplier NTGR Model + Supplier NTGR Imputation Factor Discount57%84%66% 0.55 Drug*63%* Grocery - Chain*12%* Grocery - Independent*100%* Hardware14%54%26% Home Improvement8%53%22% Mass Merchandise*59%* Membership Club5%41%15%

44 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 MSB CFL basic spiral ≤ 30 W 44 Channel Modelled NTGR Supplier NTGR Model + Supplier NTGR Imputation Factor Final NTGR Discount57%84%66% 0.55 66% Drug*63%*35% Grocery - Chain*12%*7% Grocery - Independent*100%*55% Hardware14%54%26% Home Improvement8%53%22% Mass Merchandise*59%*33% Membership Club5%41%15% Modelled, supplier, blended, and imputed NTGR by channel NTGR & Net Savings

45 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 MSB CFL basic spiral ≤ 30 W 45 Modelled, supplier, blended, and final NTGR by channel NTGR & Net Savings Channel Modelled NTGR Supplier NTGR Model + Supplier NTGR Imputation Factor Final NTGR Discount57%84%66% 0.55 66% Drug*63%*35% Grocery - Chain*12%*7% Grocery - Independent*100%*55% Hardware14%54%26% Home Improvement8%53%22% Mass Merchandise*59%*33% Membership Club5%41%15%

46 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Demonstration of Approach 46 Final IOU-level NTGR for MSB CFL basic spiral ≤ 30 W, weighted by channel, 2013-14 Channel Channel NTGR Shipments Total Program Lamps PG&ESCESDG&E Discount66%250,335061,952188,383 Drug Store35%38,2022,61234,2401,350 Grocery - Chain7%16,652080015,852 Grocery - Independent55%2,1040 0 Hardware26%86,21686,1161000 Home Improvement22%2,013,099541,868586,862884,369 Mass Merchandise33%406,3428610405,482 Membership Club15%751,543410,71210,638330,193 Total Shipments 3,564,4931,042,169696,6961,825,628 Overall NTGR 20%26%27% NTGR & Net Savings Example

47 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Alternate Gross Savings and NTGR 47

48 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Alternate Gross Savings 48 Alternate Gross Savings and NTGR

49 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Alternate Gross Savings 49 Alternate Gross Savings and NTGR  Delta Watts baseline differences – CFL, conventional: installed incandescent – CFL, alternate: installed mix of incandescent lamps and CFLs – LED, conventional: installed mix of incandescent lamps and CFLs (no alternate necessary)

50 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Recommendations 50

51 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Recommendations  Refine targeting for LED lamp incentives – Big box NTGR are relative low for most measure groups – The presence of LEDs in these channels has increased rapidly while pricing has declined at the market level – Review the cost-effectiveness of offering incentives for LED lamps in big box channels and (if not cost- effective) consider directing incentives toward non- big box channels 51 Recommendations

52 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Recommendations  Refine targeting for CFL incentives – CFL NTGR are somewhat lower than in the prior evaluation, but still potentially cost-effective – Examine the cost effectiveness of different measure groups in each retail channel 52 Recommendations

53 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Recommendations  Examine projections of lamp pricing and market conditions – Review baselines – Explore the effectiveness of offering discounts on competing technologies 53 Recommendations

54 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 Thank You!  Jenna Canseco  Andrew Stryker  Stephanie Whalley  Chris Dyson  Anton Zyarko  Claire Palmgren  Mimi Goldberg  Jeorge Tagnipes  Ralph Prahl  Many others 54

55 DNV GL © 2014 Ungraded Wednesday, March 9, 2016 SAFER, SMARTER, GREENER www.dnvgl.com Thank you for your attention 55 Jon TaffelJenna Canseco DNV GL (Oakland, CA)DNV GL (Oakland, CA) ConsultantHead of Section, Markets—West jonathan.taffel@dnvgl.comjennifer.canseco@dnvgl.com 510-891-0446 x44162510-891-0446 x44121 jonathan.taffel@dnvgl.comjennifer.canseco@dnvgl.com


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