Docstoc

Long Term Electricity Report for Maryland LTER EmPOWER

Document Sample
Long Term Electricity Report for Maryland LTER EmPOWER Powered By Docstoc
					      Long-Term Electricity Report for Maryland (LTER)
            EmPOWER Maryland White Paper
                                  November 30, 2010



Energy Efficiency and Conservation Input Assumptions- Reference Case

The EmPOWER Maryland Demand Reduction Goal
The utility programs achieve a total demand reduction of 2,170 MW by 2015, meeting
the EmPOWER Maryland demand reduction goal. This is held constant from 2015 to
2030.

The EmPOWER Maryland Energy Reduction Goal
State-wide energy efficiency and conservation efforts will achieve a total of 4.2 million
MWh in energy reductions by 2015. This is based on achieving approximately 38
percent of the reduction amount that was initially estimated by the PSC in 2008 as
required to meet the EmPOWER Maryland goals. The energy reductions are assumed
to be held constant from 2015 to 2030.

Energy Efficiency and Conservation Input Assumptions- High Efficiency Case

EmPOWER Maryland Demand Reductions
The utility programs achieve a total demand reduction of 2,170 MW by 2015 with an
additional 50 percent of the demand reduction goal achieved between 2015 and 2030,
for a total demand reduction of 3,260 MW in 2030.

EmPOWER Maryland Energy Reductions

According to the PSC Notice EmPower Maryland Targets and Population issued on
August 15, 2008, State-wide energy reductions would need to total 11.2 million MWh to
meet the EmPOWER Maryland 15 percent by 2015 reduction goal. This reduction target
is assumed to be met, with 50 percent of the reductions achieved by 2015 and then
growth in energy efficiency savings in 2016 and beyond so that 100 percent of the 11.2
million MWh energy-use reduction is achieved by 2020. The reductions are assumed to
be held constant from 2020 to 2030.

Supporting Documentation for Input Assumptions

         In July 2007, Governor Martin O‟Malley announced the EmPOWER Maryland
initiative, a goal to reduce Maryland‟s per capita energy consumption and peak demand
by 15 percent by 2015, relative to 2007 levels. This initiative was codified into law in


                                            1
2008 with House Bill 374, the EmPOWER Maryland Energy Efficiency Act of 2008
(“EPM Act”). The EPM Act seeks to achieve electric consumption and peak demand
reductions as follows:

      Per capita electricity consumption: 5 percent reduction by the end of 2011 and 15
       percent by the end of 2015, from 2007 levels.
      Per capita peak demand: 5 percentage point reduction by the end of 2011, 10
       percent by the end of 2013, and 15 percent by the end of 2015, from 2007 levels.

Under the EPM Act, the investor-owned electric utilities, along with Maryland‟s largest
cooperative, are responsible for the 15 percent demand reduction and a 10 percent
consumption goal, with the remaining 5 percentage point reduction in per capita
electricity consumption to be achieved through State-administered programs and
changes to codes and standards. The Maryland Energy Administration is charged with
implementing programs and tracking progress toward the reductions to be achieved by
State-administered programs.

Utility Energy Efficiency and Conservation Programs

        The EPM Act directed the utilities to implement „cost effective‟ energy efficiency
and demand response programs. Concerns about program costs, however, delayed
final approval of the utility-proposed programs. The first few utility energy efficiency and
conservation programs approved by the Maryland Public Service Commission (“PSC”)
were for Baltimore Gas & Electric (“BGE”) in August 2008. The remaining BGE
programs were approved for implementation in December 2008. The programs for
Delmarva Power (“Delmarva”), Potomac Electric Power (“Pepco”), Allegheny Power
(“Allegheny”), and Southern Maryland Electric Cooperative (“SMECO”) received final
implementation approval in August 2009.
         The programs being offered by utilities include rebates for ENERGY STAR (“ES”)
products, energy audit and retrofit assistance, and incentives for energy efficient new
construction. All of the utilities offer some form of rebate program for purchasing
compact fluorescent lights (“CFLs”), energy-efficient refrigerators, and energy-efficient
room air conditioners. Some of the programs include rebates for other energy-efficient
appliances such as water heaters, clothes washers, and heat pumps. Rebate programs
for central heating and cooling systems (HVAC) are also being offered. All of the
utilities have been directed by the PSC to include a series of programs targeting low-
income consumers. Low-income programs generally include most of the residential
programs offered to all customers but are delivered to low-income consumers on a
reduced or no-cost basis. BGE‟s programs were fully implemented by mid-2009, but as
a result of the delay in gaining final approval, most of the other utility programs were
launched in late 2009 and early to mid-2010 (see Table 1).


                                             2
                                         Table 1
                              EmPOWER Maryland Utility Programs
Programs                                                                                 Launch Date
Allegheny
Residential
Lighting & Appliance, Home Performance, Low Income                                         11/2/2009
HVAC                                                                                        1/4/2010
Commercial & Industrial                                                                    11/20/2010
BGE
Residential
Lighting & Appliances, HVAC, Limited Income Energy Efficiency                              4/20/2009
Quick Home Energy Check-up                                                                  5/4/2009
ENERGY STAR for New Homes                                                                   6/1/2009
Home Performance with ENERGY STAR                                                           7/6/2009
Commercial & Industrial                                                                    4/20/2009
Delmarva
Residential
Lighting & Appliances*                                                                     10/15/2009
HVAC Efficiency, Home Performance with ENERGY STAR, Quick Home
                                                                                           3/31/2010
Energy Check-up, Income Eligible
Commercial & Industrial
Prescriptive, Custom, HVAC                                                                 9/24/2009
O&M and Commissioning                                                                      1/29/2010
Pepco
Residential
Lighting & Appliances*                                                                     10/15/2009
HVAC Efficiency, Home Performance with ENERGY STAR, Quick Home
                                                                                           3/31/2010
Energy Check-up, Income Eligible
Commercial & Industrial
Prescriptive, Custom, HVAC                                                                  9/8/2009
O&M and Commissioning                                                                      1/29/2010
SMECO
Residential
Lighting & Appliances                                                                      11/9/2009
HVAC, Quick Home Energy Check-up                                                            1/1/2010
Home Performance with ENERGY STAR, Energy Star New Homes                                    3/1/2010
Limited Income Energy Efficiency                                                            2/1/2010
Commercial & Industrial                                                                     1/1/2010

*Delmarva and Pepco had existing lighting programs that began in November 2007 and were subsequently rolled
into the current Lighting & Appliance programs in October 2009.




                                                     3
The energy reductions achieved and approved by the PSC are shown in Table 2.


                                       Table 2
                        EmPOWER Maryland Program Energy Savings


              Utility                      2009 (MWh)                2010 (MWh)

              Allegheny                           66                     N/A*
              BGE                             73,867                     N/A*
              Delmarva                         6,649                     N/A*
              Pepco                           24,571                     N/A*
              SMECO                              248                     N/A*
              Total                          105,401                     N/A*

              Cumulative                     105,401                     N/A*

              *Not Available. Second and third quarter 2010 energy savings are expected
              to be approved by the PSC in January 2011.
              Source: Review of Utility Quarterly EmPOWER Maryland Reports to the PSC.




Utility Demand Response Programs

        The EMP Act directed utilities to reduce per capita peak demand by 15 percent
by the end of 2015, from 2007 levels. Allegheny is not currently running an EmPOWER
Maryland demand response program due to the low PJM capacity prices in its service
territory and hence the lack of any cost-effective mechanism to meaningfully reduce
peak demand. The other utilities are operating the following demand response
programs under the EmPOWER Maryland initiative and bidding the resultant load
reductions into the PJM capacity market.
Baltimore Gas & Electric:
      Peak Rewards – an automatic air conditioner and heat pump cycling program for
       residential customers.
Potomac Electric and Delmarva Power:
      Energy Wise Rewards – a residential direct load control program for air
       conditioner cycling.
SMECO:
      CoolSentry – a residential direct load air conditioner control program.




                                                  4
        Table 3, below, outlines the load reductions achieved as of 2nd Quarter 2010
 under the EmPOWER Maryland utility demand response programs.1


                                         Table 3
                       EmPOWER Maryland Program Demand Savings (MW)
As of Q2 2010         Allegheny         BGE          Delmarva          Pepco    SMECO           Total
Peak Load
                         2.90          465.95           10.00          38.43     21.40         538.68
Reduction (MW)
Source: Review of Utility Quarterly EmPOWER Maryland Reports to the PSC.




 Utility EmPOWER Maryland Goals

         In connection with the EmPOWER Maryland legislation, in 2008, the PSC
 developed initial estimates of the energy and demand reductions that would be required
 to meet the EmPOWER Maryland goals. These original energy reduction goals
 developed where based on the PJM 2007 forecast, with energy consumption growth
 continuing along the pre-recessionary trend. Energy usage in 2007 was high relative to
 the post-recession energy consumption of the last few years. The resultant forecast of
 energy sales for the years 2011 and 2015 was higher than it would have been if current
 values were used. The total amount required for a Maryland 5 percent energy reduction
 by 2011 was estimated at 3,254,581 MWh.2 The estimated energy reduction goals for
 the utilities for 2011 are detailed in Table 4 below.




 1
   As of November 30, 2010, the utility EmPOWER Maryland reports for the second quarter of 2010 have
 not been approved by the Maryland PSC.
 2
   The PSC estimated total energy use for all utilities in Maryland but the EmPOWER Maryland act only
 applies to the investor-owned utilities and SMECO. The remaining small utilities in Maryland together
 account for approximately 2.5 percent of total electricity sales in the State.


                                                       5
                                           Table 4
                 Five Percent Reduction Goal for Maryland Energy Sales -- 2011
                                                   2011
                                     Actual     Per Capita                    2007                  Difference
                                    2007 Per      Energy        Energy    PJM Derived                Between
                    Actual           Capita      Use Goal        Use       Energy Use               Goal and
                 2007 Energy         Energy        (5%          Statute     Forecast               PJM Derived
                    Sales*            Use       reduction)      2011**        2011                   Forecast
    Utility          MWh              MWh          MWh           MWh          MWh                      MWh
BGE                 35,109,765          13.39        12.72 34,401,168       36,454,116                 2,052,948
Pepco               16,518,897           9.39          8.92 16,340,383      17,025,761                   685,378
Allegheny            7,445,622          17.54        16.66     7,472,019     7,594,683                   122,664
Delmarva             4,683,582          13.61        12.93     4,716,533     4,922,379                   205,846
SMECO                3,684,887          11.15        10.59     3,748,007     3,842,236                    94,229
                                        Total Estimated Utility Reduction Goal for 2011                3,161,066
* Energy Sales have been grossed up to account for line losses.
** Energy use goal developed by the PSC recognizes growth in population between 2007 and 2011.
Source: Maryland Public Service Commission, General Utility Notices, EmPower Targets and Population, 08/15/08.



To meet the 10 percent 2015 reduction goal, the PSC estimated the utilities would need
to make the energy reductions outlined in Table 5.

                                          Table 5
                 Ten Percent Reduction Goal for Maryland Energy Sales -- 2015
                                                  2015 per
                                      Actual       Capita                                           Difference
                                     2007 per      Energy                  PJM Derived               Between
                                      Capita      Use Goal       Energy     Energy Use              Goal and
                 Actual 2007          Energy        (10%        Use Goal     Forecast              PJM Derived
 Maryland       Energy Sales*          Use       reduction)      2015**        2015                  Forecast
    Utility         MWh                MWh          MWh           MWh          MWh                     MWh
BGE                35,109,765            13.39         12.05 33,382,109      37,679,204                4,297,095
Pepco              16,518,897             9.39          8.45 16,037,468      17,912,125                1,874,656
Allegheny           7,445,622            17.54         15.79    7,451,881     7,790,641                  338,760
Delmarva            4,683,582            13.61         12.25    4,731,788     5,234,990                  503,202
SMECO               3,684,887            11.15         10.04    3,787,437     4,042,264                  254,827
                                         Total Estimated Utility Reduction Goal for 2015               7,268,539
* Energy Sales have been grossed up to account for line losses.
** Energy use goal developed by the PSC recognizes growth in population between 2007 and 2015.
Source: Maryland Public Service Commission, General Utility Notices, EmPower Targets and Population, 08/15/08.



The PSC estimated that the 10 percent goal would require a total reduction in energy
usage of 7,469,994 MWh.3 Based on the PSC forecast of energy consumption in 2015,


3
  This figure includes all utilities, including those small municipal and cooperative utilities not directed to
reduce consumption.


                                                        6
to meet a 15 percent State-wide reduction goal would require energy use to be reduced
by approximately 11,208,000 MWh.
        Energy use is down significantly compared to the PJM 2007 forecast values and
if population growth trends remain comparable to historical levels, the utilities may have
fully achieved, or even over-achieved their 2011 per capita reduction goals simply due
to the recession-induced reduction in overall energy demand. Table 6 shows that due to
reductions in energy use brought on by the recession, the utilities (with the exception of
Allegheny) were at their 2011 per capita goals in 2009.


                                             Table 6
                      2009 per Capita Energy Use as Compared to 2011 Goals
                     2011 per                                                                          2009 per
                      Capita                                                                            Capita
                    Energy Use        2011          Energy Use                               2009       Energy
   Maryland            Goal         Estimated        Goal 2011        2009 Energy         Estimated      Use
     Utility           MWh          Population         MWh               Sales*           Population     MWh
BGE                      12.72       2,703,746        34,401,168        33,680,757         2,647,504       12.72
Pepco                      8.92      1,831,254        16,340,383        15,816,242         1,794,922        8.81
Allegheny                16.66         448,396         7,472,019         8,073,003           428,009       18.86
Delmarva                 12.93         364,811         4,716,533         4,438,444           346,001       12.83
SMECO                    10.59         353,794         3,748,007         3,512,070           335,309       10.47
* Energy Sales have been grossed up to account for line losses.
Source: Maryland Public Service Commission calculations based on utility-reported data.




Utility EmPOWER Maryland Reduction Forecast by the Maryland PSC

        In the EmPOWER Maryland program filings, the utilities calculated the energy
and demand reductions each of the approved programs were projected to achieve. The
estimated target energy reduction amounts were about half of the EmPOWER Maryland
reduction requirements that were originally estimated as needed to meet the per capita
goals by the PSC using the PJM 2007 forecast as shown above.4 The PSC
subsequently approved these utility programs along with the achievable energy
reduction targets. The PSC Staff have developed a forecast of expected energy
reductions relative to the utility-estimated targets reported as being achievable in the
filings of the approved programs. Staff‟s estimated reductions are projected to 2015 and
are based on the energy and demand reduction data as reported by the utilities in their
quarterly and annual EmPOWER Maryland reports thus far. The target amounts shown
in the graphs below represent the reductions from approved-programs as calculated by
the utilities in their filings to the PSC. The PSC Staff-projected energy reductions
4
    The utilities estimated the demand reduction targets could be achieved in full.


                                                        7
forecasts were developed using data filed with the PSC as part of the EmPOWER
Maryland Quarterly and Annual program filings and applying three growth scenarios:
   1. Maintain - continuing the same reductions per month as seen in the first quarter
      of 2010;
   2. Linear – the amount of reductions achieved by the energy efficiency programs
      are assumed to increase as a linear continuation of programs seen to date; and
   3. Logarithmic - imposing a logarithmic formula on the growth in energy reductions
      going forward.
      The three forecasts result in the energy reduction paths shown in Figure 1 and
the demand reduction paths shown in Figure 2. Note that Figure 2 shows the total
demand reductions, which consist of reductions from both the demand response
programs and the demand reductions associated with energy efficiency and
conservation programs.

                                     Figure 1
                            Energy Reduction Projections




                                           8
                                             Figure 2
                                    Demand Reduction Projections




           Table 7 outlines the projected energy reductions from the three scenarios
   compared to the reduction targets for 2015 that were filed as part of the utility
   EmPOWER Maryland plans. The percentage of the target reductions that each scenario
   is projected to achieve is also presented.

                                               Table 7
                                 PSC Energy Reduction Projections 2015
              Utility      Projected
                                                          Projected
            Estimated       Energy                                     Percent of    Projected    Percent of
                                        Percent of         Energy
             Program      Reduction -                                   Target        Energy       Target
                                          Target         Reduction -
              Target       Maintain                                    Reduction    Reduction -   Reduction
                                        Reduction          Linear
              Energy        2010 Q1                                      Linear     Log Growth       Log
                                         Maintain          Growth
            Reduction       Results                                     Growth         MWh         Growth
                                                            MWh
Utility        MWh           MWh
Allegheny      261,117        159,089      61%               189,818     73%             35,398     14%
BGE           2,611,902     1,393,029      53%             4,397,536     168%         1,993,449     76%
Delmarva       270,552         17,614     6.5%               938,043     347%            74,376     27%
Pepco         1,133,739       183,408      16%               419,328     37%            348,073     31%
SMECO          165,542        160,744      97%               489,850     296%           365,350     221%
Total         4,181,735     1,754,795      42%             6,244,757     149%         2,781,238     67%


          The demand reductions forecast for 2015 along with the percentage of the target
   each is projected to achieve, are presented in Table 8. Note that Allegheny does not
   have a demand response program.




                                                     9
                                                     Table 8
                                       2015 Projected Demand Reductions
                  Utility    Projected
                                                          Projected
                Estimated    Demand                                    Percent of    Projected
                                           Percent of     Demand                                   Percent of
                 Program    Reduction -                                 Target       Demand
                                             Target      Reduction -                                Target
                  Target     Maintain                                  Reduction    Reduction -
                                           Reduction       Linear                                  Reduction
                 Demand       2010 Q1                                    Linear     Log Growth
                                            Maintain       Growth                                 Log Growth
                Reduction     Results                                   Growth          MW
                                                             MW
Utility            MW           MW
BGE               1,229        1,752         143%            1,411        115%         1,401        114%
Delmarva          120           60            50%            374          312%         135          113%
Pepco             283          104            37%            1,380        488%         493          174%
SMECO              60           55            92%            224          373%         141          235%
Total             1,692        1,971         116%            3,389        200%         2,170        128%


          It is important to note that the above forecast values (Tables 7 and 8) are based
  on only one or two data points. As outlined above, many of the utility programs did not
  begin until 2010. The above forecasts were based on data up to and including the 2010
  first quarter utility EmPOWER Maryland reports. Therefore, the forecasts contain limited
  data points for many programs. The second and third 2010 quarterly reports have been
  submitted to the PSC and a hearing to examine them is scheduled for December 16,
  2010. After the quarterly reports have been approved, PSC Staff will update the above
  forecasts with the new data points and the results will change. The input assumptions
  for the model may also change as a result of the updated data, however the
  methodology on which the assumption is based will remain the same.

  EmPOWER MD Maryland Energy Administration Programs

        The utilities are responsible for meeting 10 percentage points of the 2015 per
  capita energy reduction and the Maryland Energy Administration (MEA) is sponsoring
  several programs aimed to help achieve the remaining 5 percent per capita reduction by
  2015. MEA administers the following programs:

             Home Performance with Energy Star program – trains and certifies contractors to
              perform energy audits and install whole-house energy improvements.
             Green Building Tax Credit – provides a tax credit of up to 8 percent of the total
              cost for constructing a certified green building.
             State Agency Loan Program – provides loans to State agencies for cost-effective
              energy efficiency improvements in State facilities.
             Jane E. Lawton Conservation Loan Program – provides loans to local
              governments, nonprofits, and businesses in the State to install energy
              conservation improvements.
        Data received from MEA sets a 2011 reduction target for the MEA-administered
  programs at approximately 73,379 MWh. The data indicate that as of the third quarter of


                                                        10
2010, MEA-administered programs have achieved about 14,544 MWh of energy
reductions, which is about 20 percent of their target.

EmPOWER Maryland Assumptions in the Long-Term Electricity Report

        The study period for the Long-Term Electricity Report (“LTER”) for Maryland is
2010 to 2030, extending out 15 years beyond the current EmPOWER Maryland goals.
In its Reference Case the LTER will include a set of assumptions related to the level of
energy and demand reductions for EmPOWER Maryland. Based on the information
above, the LTER will utilize the logarithmic forecast developed by the PSC for the
reference case. The PSC projections above show that the under the logarithmic
forecast, the utilities will achieve approximately 2.8 million MWh of energy reductions
from their energy efficiency and conservation programs. This reduction amount is about
67 percent of the energy reductions the utilities estimated their programs could provide
and would be about 38 percent of the original EmPOWER Maryland reduction
requirements estimated by the PSC in 2008. Consistent with the utility achievements,
the LTER will assume that State programs and initiatives will also have a 38 percent
achievement rate. This translates into an additional energy reduction of 1.4 million
MWh. For a total assumed energy reduction of 4.2 million MWh in 2015. Utilities are on
track to meet and exceed the demand reductions. Consistent with these projections, the
LTER will assume that 2,170 MW (128 percent) of the utility demand reductions will be
met by 2015. These assumptions are consistent with discussions held between PPRP
and PSC Staff and between PPRP and the utilities. The reductions are then held flat
between 2016 and 2030.
       For the high energy efficiency/energy conservation scenarios, we assume that
128 percent of the demand target is reached plus an added 50 percent achieved over
the 2016 through 2030 period for a total demand reduction of 3,260 MW. For energy,
we assume 100 percent of the original State-wide reduction requirement as estimated
through the PSC 2008 forecast will be achieved, with 50 percent achieved through 2015
and the remaining 50 percent over the 2016 through 2020 period. This translates into a
5.6 million MWh reduction in 2015 for a total reduction of 11.2 million MWh by 2020,
and then held flat through 2030.




                                          11

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:4
posted:10/30/2012
language:English
pages:11