1. Northwest Power and Conservation Council Slide 1 Accelerating Energy Efficiency To Reduce the PNW Power System's Carbon Footprint Tom Eckman Manager, Conservation Resources Northwest Power and Conservation Council Presented at Affordable Comfort Northwest February 3, 2009

2. Northwest Power and Conservation Council Slide 2 slide 2 Tonight’s Topics Energy Efficiency’s Role Reducing the Size of the PNW Power System’s Carbon Footprint Energy Efficiency’s Role Reducing the Size of the PNW Power System’s Carbon Footprint –Historical Impacts –Projected Impacts of Future Energy Efficiency and Renewable Resource Development Can More Be Done? Can More Be Done? – Initial Estimates for the 6 th Plan’s Assessment of Remaining Energy Efficiency Potential

3. Northwest Power and Conservation Council Slide 3 slide 3 PNW Energy Efficiency Achievements 1978 – 2007 Since 1978 Utility & BPA Programs, Energy Codes & Federal Efficiency Standards Have Produced Almost 3600 aMW of Savings.

4. Northwest Power and Conservation Council Slide 4 slide 4 So What’s 3600 aMW? It’s enough electricity to serve more than the entire state of Idaho and all of Western Montana It’s enough electricity to serve more than the entire state of Idaho and all of Western Montana It saved the region’s consumers nearly than $1.6 billion in 2007 It saved the region’s consumers nearly than $1.6 billion in 2007 It lowered 2007 PNW carbon emissions by an estimated 14.1 million tons. It lowered 2007 PNW carbon emissions by an estimated 14.1 million tons.

5. Northwest Power and Conservation Council Slide 5 slide 5 Since 1980 Energy Efficiency Resources Met About Half of PNW Load Growth

6. Northwest Power and Conservation Council Slide 6 slide 6 Energy Efficiency Is The Region’s Third Largest Resource

7. Northwest Power and Conservation Council Slide 7 slide 7 Utility Acquired Energy Efficiency Has Been A BARGAIN!

8. Northwest Power and Conservation Council Slide 8 slide 8 5th Plan Relied on Conservation and Renewable Resources to Meet Nearly All Load Growth *Actual future conditions (gas prices, CO2 control, conservation accomplishments) will change resource development schedule and amounts. *Actual future conditions (gas prices, CO2 control, conservation accomplishments) will change resource development schedule and amounts.

9. Northwest Power and Conservation Council Slide 9 slide 9 Meeting 5 th Plan’s Conservation Targets Reduces Forecast PNW Power System CO 2 Emissions in 2024 by Nearly 20%

10. Northwest Power and Conservation Council Slide 10 slide 10 Why Worry?

11. Northwest Power and Conservation Council Slide 11 slide 11 Existing Power System Resources Are Dominated by Non-CO 2 Emitting Resources

12. Northwest Power and Conservation Council Slide 12 slide 12 Total PNW Power System Carbon Emissions Have Grown Significantly Since 1990 ~ 15 Coal Plants ~23 Coal Plants Existing Coal Plants Produce 85% of Total PNW Power System CO 2 and Provide 20% of the Region’s Power

13. Northwest Power and Conservation Council Slide 13 slide 13 The PNW Now Plans To Meet Nearly All Future Load Growth With Conservation and Renewable Resources

14. Northwest Power and Conservation Council Slide 14 slide 14 How Will This Impact the Power System’s Carbon Footprint?

15. Northwest Power and Conservation Council Slide 15 slide 15 Even If We Meet All Load Growth With Energy Efficiency and Renewable Resources CO 2 Emissions from Existing Fossil Fueled Plants Remain Unchanged

16. Northwest Power and Conservation Council Slide 16 slide 16 Meeting the 5 th Plan’s Conservation Goals AND State Renewable Portfolio Standards Will Not Meet WCI CO 2 Emissions Targets WCI Goal

17. OK, So What’s The Answer?

18. Northwest Power and Conservation Council Slide 18 slide 18 5 th Plan Identified Nearly 4,600 MWa of “Technically Available” Conservation Potential

19. Northwest Power and Conservation Council Slide 19 slide 19 Adjustments to 5 th Plan’s Conservation Resource Potential Reductions in Available Potential Reductions in Available Potential –Program Accomplishments –Changes in Law »Federal Standards for general service lighting »State Building Codes –Changes in Markets »Improved “Current Practice” due to Energy Star, LEED, Programs, Market Transformation »Other Changes to Federal Standards (10 adopted, 21 under revision, and 12 with effective dates by 2014) –Changes in Forecast »Less new commercial floor area »Lower industrial forecast

20. Northwest Power and Conservation Council Slide 20 slide 20 Adjustments to 5 th Plan’s Conservation Resource Potential Increases in Available Potential Increases in Available Potential –Changes in Scope »Distribution System Efficiency Improvements »Consumer electronics (TV’s, set top boxes) »Irrigation Water Management and Dairy Farm –Changes in Data and Technology »Detailed Industrial Sector Potential »New Measures (e.g. ductless heat pumps, solid state lighting)

21. Northwest Power and Conservation Council Slide 21 slide 21 Avoided Costs Are Forecast to Be Significantly Higher

22. Northwest Power and Conservation Council Slide 22 slide 22 Energy Efficiency is Still the Cheapest Option Assumptions : Efficiency Cost = Average Cost of All Conservation Targeted in 5 th Power Plan Transmission cost & losses to point of LSE wholesale delivery No federal investment or production tax credits Baseload operation (CC - 85%CF, Nuclear 87.5% CF, SCPC 85%, Wind 32% CF) Medium NG and coal price forecast (Proposed 6 th Plan) Bingaman/Specter safety valve CO2 cost

23. Northwest Power and Conservation Council Slide 23 slide 23 So Even After All Adjustments – We’ve Have More To Do 5 th Plan Target 6 th Plan Avoided Cost

24. Northwest Power and Conservation Council Slide 24 slide 24 Draft 6 th MWa of “Technically Available” Conservation Potential by Sector

25. Northwest Power and Conservation Council Slide 25 slide 25 Preliminary Draft 6th Plan Residential Water Heating, Lighting and Appliance Supply Curve

26. Northwest Power and Conservation Council Slide 26 slide 26 Preliminary Draft 6th Plan Residential Space Conditioning Supply Curve

27. Northwest Power and Conservation Council Slide 27 slide 27 Preliminary Draft 6th Plan Residential Supply Curve for Lost-Opportunity and Non-Lost Opportunity Conservation

28. Northwest Power and Conservation Council Slide 28 slide 28 Take This With You Meeting ALL Regional Load Growth With Conservation AND Renewable Resources Will Not Meet WCI CO 2 Emissions Targets Meeting ALL Regional Load Growth With Conservation AND Renewable Resources Will Not Meet WCI CO 2 Emissions Targets Technically Achievable Conservation Potential Could Reduce Projected 2030 Loads By 3000 – 4000 MWa Technically Achievable Conservation Potential Could Reduce Projected 2030 Loads By 3000 – 4000 MWa It Will Require A Much Larger (2x-3x) Investment In Currently Cost-Effective Energy Efficiency and New Technology To Reduce Our Carbon Footprint To 1990 Levels It Will Require A Much Larger (2x-3x) Investment In Currently Cost-Effective Energy Efficiency and New Technology To Reduce Our Carbon Footprint To 1990 Levels

29. Northwest Power and Conservation Council Slide 29 slide 29 Any Questions?