1. Pathway to Full Value: Market Structures to Monetize Energy Efficiency
Northwest Energy Efficiency Leadership Forum
James Newcomb | Oct 17, 2016 | Portland, OR
Transforming global energy use to create a clean, prosperous, and secure low-carbon future.

2. “Today, the world meets the moment, and if we follow through on the commitments that this Paris agreement embodies, history may well judge it as a turning point for our planet.”
President Barack Obama, October 5, 2016

3. Getting below 2 degrees
Source: Energy Transitions Commission; ENERDATA (2015)

5. U.S. buildings: 3-4x energy productivity worth 4x its cost
(site energy intensities in kWh/m2-y; U.S. office median ~293)
...➝≤50 (–83% to –85%)
2015 new
~277➝173 (–38%)
2010 retrofit
284➝85 (–70%)
2013 retrofit
...➝30 (–77%)
2013 new
Yet all the technologies in the 2015 example existed well before 2005!

6. Technology Improvements are Driving Increased Opportunities and Value for Energy Optimization
LEDs serve as an example of the trajectory of building technology, both in cost reduction and increased quality.
Between 2010 and 2015
Costs have declined by 87%
Performance has increased by 92%
These trends are expected to continue over the next 15 years.

7. Demand Growth has Slowed in the PNW…
Source: NW Council

8. …and is Projected to Continue to Grow Slowly
Source: NW Council

9. BPA Real Power Rates Have Held Steady
Source: BPA

10. Mid-Columbia Wholesale Power Prices are Falling
Source: SNL Financial

11. Source: NW Council

13. PSE/Snohomish Conservation Contract Could Be a Model
Might allow utilities to invest in efficiency in other utility territories
PSE paid to have EE measures installed in Snohomish service territory
Snohomish continued to buy the same volume of power from BPA as if they had not installed the EE measures, creating a surplus of energy
Snohomish transferred the surplus energy to PSE (~450,000 MWh over 11 years)
PSE counted the energy savings towards their efficiency goals
Contracting and accounting was novel
Benefits
Snohomish had low avoided costs, making EE measures less cost effective in their territory
PSE’s avoided costs were higher than in Snohomish
BPA revenue remained whole

15. CAISO EIM Already Expanding Regionally
By the end of 2018, all investor-owned utilities in the PNW other than Avista and NorthWestern will be part of the CAISO Energy Imbalance Market
CAISO EIM has resulted in $88 million in benefits since Nov 2014 by facilitating interregional transfers of energy and reducing curtailment
Better interregional coordination should help CA to achieve aggressive renewable and GHG reductions goals, incentivizing continued expansion
CAISO EIM expansion is paving the way for full CAISO market expansion across the West
Source: CAISO

16. CAISO Expansion Could Enable PNW to CA Sales
CAISO + PAC
Regional ISO

17. CAISO Expansion Could Facilitate PNW to CA Sales
Potential Benefits
CAISO expansion would make it easier for utilities or BPA to sell EE power into CA market
Currently, to get power into CAISO can require moving across several balancing areas, incurring additional transmission costs at each interface
PNW hydro could provide the additional flexibility needed in light of increasing renewable generation in CA
Regional ISO would result in better utilization of current transmission capacity
Coal retirements could unlock additional transmission capacity
Bilateral contracts result in underutilization of transmission capacity
Regional transmission planning could lead to additional transmission being built between the PNW and CA
Carl mentioned that there are some transmission contracts into CA that aren’t being fully utilized according to a WECC study—so there’s transmission capacity that is contracted but not being fully utilized
In moving to a regional ISO, there would be some issues with unwinding existing contracts
Carl mentioned that this would be similar to the role that Norway plays in northern Europe in providing flexibility to the rest of the region, where renewables are rapidly growing
Carl mentioned that BPA is already interested in providing flexibility to CA

18. CA Has Set Aggressive RPS and GHG Reduction Goals
NW EE power could help meet GHG reduction

19. Community Choice Aggregation in CA Growing Rapidly
Customer preference for low-carbon power could be served by PNW EE power
Total population of communities considering CCA is 17.7 million
Potential population of communities implementing CCA by 2017 is 6.4 million
4 of the 5 CCAs going online by the end of specifically highlight non-RPS large hydro as a zero-carbon source of power
The Pacific Northwest is highlighted as a potential source for zero-carbon hydropower in addition to in-state resources
Portland General Electric already sells power to Marin Clean Energy

21. Discussion Contact: James Newcomb Managing Director
Rocky Mountain Institute

22. Peak Car Ownership

23. Autonomous vehicles could reach cost parity with conventional vehicle ownership by 2018

24. Electric vehicles will have significant cost advantages as service vehicles

25. Automated Mobility Services Could Reach ~10% of US mobility market value by 2025

26. A Fast Transition Could Deliver Large CO2 Reductions

27. Washington Energy Independence Act Set Statewide Goals
Utilities in the state are currently exceeding goals for renewable energy and energy efficiency
Goals
Progress
Energy Efficiency
Utilities set targets for 2-year periods
GHG Reductions
Clean Air Rule (effective Oct 17) sets cap on carbon pollution
50% below 1990 levels by 2050
Renewable Energy
9.0%
15% Renewables by 2020
9.7%
Note: Reported MWh are annual MWh savings from EE
Source: Washington UTC
SEO-AAA

28. Renewable Energy and EE Goals Set for Oregon
Energy Efficiency
Original RPS targets were set by Oregon Renewable Energy Act of 2007
Targets were updated by SB 1547 in 2016
Renewables source:
Energy Trust of Oregon set targets for current period in Strategic Plan released in 2014
Sources: DSIRE, Energy Trust of Oregon

29. No Statewide EE or RPS Targets or Goals in ID or MT
All large investor-owned utilities include EE in IRP process
Idaho Power
84 average MW by 2019
PacifiCorp Idaho
87,030 annual MWh through 2019
Avista Idaho
24,460 annual MWh for
NorthWestern Energy
6 average MW per year
Note: Montana’s RPS ended in 2015
Source: Idaho Power, PacifiCorp, Avista, NorthWestern

30. EE is Most Cost-Effective to Meet Demand Needs
Utilities across the region are currently exceeding goals for EE, which could create surplus energy
Source: NW Council