Assessment of Achievable Potential from Energy Efficiency and Demand Response Programs in the U.S.

Palo Alto, CA (January 1, 2009)- The Electric Power Research Institute (EPRI) recently released the results of a technical report that assesses the achievable potential for energy efficiency and demand response programs to reduce the growth rate in electricity consumption and peak demand through 2030. This “achievable potential” represents an estimated range of savings attainable through programs that encourage the adoption of energy-efficient technologies, taking into consideration technical, economic, and market constraints. This potential does not include the impact of future codes and standards not yet enacted, or any other regulatory or policy changes (such as carbon legislation); that may contribute to even greater levels of savings. Although trees are not mentioned, for the purposes of this study, trees fit into what they classify as “External Shades.”


Also highlighted are the estimated program costs associated with attaining the achievable potential reductions in electricity consumption and peak demand. The report summarized here is the first of a series of studies planned by EPRI to assess energy efficiency potential under a variety of scenarios.
Electricity Consumption
Electricity consumption in the U.S. residential, commercial, and industrial sectors has grown at an average rate of 1.7% per year from 1996 through 2006. The U.S. Energy Information Administration (EIA) in its 2008 Annual Energy Outlook Reference Case forecast (AEO 2008) projects that electricity consumption in the residential, commercial and industrial sectors will grow at an annual rate of 1.07% from 2008 through 2030, with consumption increasing by 26%, to 4,696 terawatt-hours (TWh) in that period.
Going forward, EPRI estimates that energy efficiency programs have the potential to realistically reduce this growth rate by 22% to 0.83% per year from 2008 through 2030. Under conditions ideally conducive to energy efficiency programs, this growth rate can be reduced by up to 36% to 0.68% per year. In 2030, this represents an achievable reduction in electricity consumption of between 236 billion and 382 billion kilowatt-hours (kWh) from the AEO 2008 forecast. This corresponds to a realistic achievable potential of 5% to a maximum achievable potential of 8% in 2030.
Peak Demand
Summer peak demand in the U.S., aggregated from non-coincident regional peaks, is estimated as 801 GW in 2008, and is expected to increase to 1,117 GW by 2030, an increase of 39%. Summer peak demand is expected to grow at a faster annual rate than electricity use due primarily to the expected growth in the share of air conditioned homes and buildings.
EPRI estimates that the combination of demand response and energy efficiency programs has the potential to reduce non-coincident summer peak demand by 157 GW to 218 GW. This represents a range of achievable potential reduction in summer peak demand in 2030 of 14% to 20%. This can also be expressed as a reduction in the forecast growth rate in peak demand of 46% to 65% through 2030. Half the peak demand savings result from energy efficiency actions and the other half from activities specifically designed to reduce peak demand, referred to as demand response.
Peak demand in the U.S. has grown at an average rate of 2.1% per year from 1996 through 2006, and is projected by the EIA to grow at an annual rate of 1.5% from 2008 through 2030. The combination of energy efficiency and demand response programs has the potential to realistically reduce this growth rate to 0.83% per year. Under conditions ideally conducive to energy efficiency and demand response programs, this growth rate can be reduced to as low as 0.53% per year.
How do these estimates compare with recent program results for the nation?
A recent study released by ACEEE has determined that energy efficiency programs operated in 2006 reduced electricity consumption in the U.S. by an average of 0.24% in 2006. This finding underscores that, for the nation as a whole, current energy efficiency program efforts will need to expand by 40% to capture the moderate case (i.e. realistic achievable potential) for savings identified in this study. By the same token, according to the ACEEE study, in 2006 eighteen states attained annual electricity savings from programs within the range of the national achievable potential (i.e. above 0.40%). Of these eighteen states, in fact, three states – Rhode Island, Vermont, and Connecticut – implemented programs in 2006 that reduced electricity consumption that year by more than 1%.
Related Resources:
Assessment of Achievable Potential from Energy Efficiency and Demand Response Programs in the U.S.
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