Title ABC

1
An Energy Efficiency Strategy for New Jersey
Achieving the Energy Master Plan
Goals Presentation to the NJ Board of Public
Utilities By Sue Coakley, Executive
Director Northeast Energy Efficiency
Partnerships April 16, 2009
2
NJ 2020 Energy Efficiency Strategy

• Background
• Results
• Report Structure
• Recommendations
• Next Steps

• 20 by 2020

3
NJ 2020 Energy Efficiency Strategy Background

• Governor Corzines 2008 Energy Master Plan
• Place New Jersey at the forefront of a growing
  clean energy economy with aggressive energy
  efficiency and renewable energy goals and action
  items, and the development of a 21st century
  energy infrastructure.

• 20 by 2020

Goal 1 Maximize Efficiency - Reduce projected
energy consumption by 20 by 2020 http//nj.gov/n
j/trans/http//nj.gov/nj/trans/
4
NJ 2020 Energy Efficiency Strategy Background

• Energy Efficiency Strategy Purpose
• Achieve the 2020 Master Plan energy savings goal
  cost-effectively and expeditiously
• Develop a best in class program portfolio to
  overcome market barriers to cost-effective energy
  efficiency

• 20 by 2020

5
NJ 2020 Energy Efficiency Strategy Background

• Approach
• NEEP team of national experts
• Address all customer sectors, all fuels, all
  demand side resources
• Build on experience of successful programs in New
  Jersey and other states and regions

• 20 by 2020

• Stakeholders to guide development provide data
  and perspective
• Cost-effectiveness assessment to support
  strategies

6
NJ 2020 Energy Efficiency Strategy Background

• Participants
• Stakeholder Comments
• Gas and electric utilities NJUA
• Office of Ratepayer Counsel
• Rutgers CEEEP
• NJ Homebuilders
• Isles, Inc
• CMC Energy Associates

• NJ Assoc of Realtors
• NJ Apartment Owners Assoc
• NAESCo
• Assemblyman Chivukula
• Assemblyman McKeon
• NJ Institute of Technology
• Fuel Merchants Assoc. of NJ
• NJ Business Industry Assoc.
• Alliance to Save Energy
• The E-Cubed Company

• Project Team
• NEEP
• Dunsky Energy Consulting
• Vermont Energy Investment Corporation
• Optimal Energy Inc.
• North Atlantic Energy Advisors
• Ecos Consulting
• Applied Energy Group

• 20 by 2020

7
NJ 2020 Energy Efficiency Strategy Results

• Efficiency Strategy Meets or Exceeds Energy
  Master Plan Goals

Energy Master Plan 2020 Goal Energy Efficiency Strategy Portfolio of EMP Goal
Electric Energy 14,000 GWh? 17,800 GWh 127
Electric Capacity 3,300 MW 6,400 MW 194
Other Energy 75,000 BBTUs 74,000 BBTUs 99

• 20 by 2020

• EMP energy efficiency program goals ONLY
• ? EMP efficiency programs adjusted for the impact
  of new federal incandescent lamp standards
• Considers only efficiency programs and building
  energy rating policies). Excludes on-site power

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NJ 2020 ENERGY EFFICIENCY STRAGEGY RESULTS

• Efficiency program portfolio nearly meets total
  electric reduction goal. Codes standards
  necessary to meet goal.

17,000 GWh EMP Total Electric Reduction Goal
14,000 GWh EMP Efficiency Program Goal
9
NJ 2020 ENERGY EFFICIENCY STRAGEGY RESULTS

• Efficiency program strategies can exceed EMP peak
  reduction goals.

5,700 MW EMP Peak Reduction Goal
10
NJ 2020 ENERGY EFFICIENCY STRAGEGY RESULTS

• Combined heat and power is important to meet EMP
  heating savings goal. Codes standards necessary
  too.

110 trillion BTUs EMP Heating Savings Goal
75 trillion BTUs EMP Efficiency Program Goal
11
NJ 2020 ENERGY EFFICIENCY STRAGEGY RESULTS

• Efficiency Strategy (w/o CHP) provides NJ
  consumers 16.8 billion in net savings (present
  value 2008 dollars).
• BenefitCost 2.6

28 billion total savings
11.2 billion total investment
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NJ 2020 ENERGY EFFICIENCY STRAGEGY RESULTS

• Savings from all customer sectors.

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NJ 2020 Energy Efficiency Strategy Results

• Achieving EMP Energy Reduction Goals needs
• Large scale effort
• 30 savings in 60 of NJ homes and buildings
• 1.7 million homes
• 80,000 to 240,000 business and government
  facilities
• Broad participation All hands on deck
• A concerted statewide effort
• All fuels electric, gas, heating oil
• Programs and policies

• 20 by 2020

• 11.2 billion investment over 12 years
• Visionary, long-term leadership

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NJ 2020 Energy Efficiency Strategy Report

• Recommendations detailed in
• Executive Summary
• A Foundation for Success
• Savings in Homes
• Saving Energy in Business Government

• On-Site Power Cross Cutting Strategies
• Savings, Costs, Benefits

• 20 by 2020

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 1 Establish the New Jersey Energy Efficiency
  Utility

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 2 Supportive Regulatory Oversight
• Long-term view in setting goals
• Results-oriented financial incentives ?
  Efficiency as attractive as other regulated
  investments
• Remove regulatory barriers to aggressive programs
• Streamlined regulations - accountability for
  results

• 4-year plans w/ annual reports plan updates
• Budget program flexibility to meet goals
• Active ongoing stakeholder process stay
  informed, provide feedback

• 20 by 2020

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 3 Flexible Energy Efficiency Program Strategies
• Statewide programs consistent, integrated,
  leveraged
• Serve specific market segments with
  customer-oriented approach ? sells energy
  efficiency
• Make efficiency investments attractive,
  affordable and accessible - cost-effective deal
  customers cant refuse.
• Targeted marketing
• Understand and address customer needs and
  barriers
• Flexible program services and financial
  assistance
• Whole solutions all fuels, all cost-effective
  demand-side options

• 20 by 2020

• Incentives and financing to close the deal,
  maximize cost-effective savings
• Use and expand existing market channels
• Statewide marketing campaign ? use social
  marketing strategies, consistent messages

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 4 Aggressive State and Local Policies
• Progressive building energy codes net zero
  energy as long-term goal
• Auto update to national energy code updates
• Adopt optional advanced stretch code
• Allow third party certified inspectors
• Time of Sale Building Energy Rating and
  Performance
• Strong federal and state appliance standards

• 20 by 2020

• State and local government Lead by Example
  (e.g., 21st Century Schools)
• Government leveraged financing tools
• State tax incentives

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 5 Energy Rates, Prices and Usage Information
• Rate designs to encourage reduced energy
  consumption
• Inverted block rates ?residential and small
  commercial
• Time of use rates and metering ? customers with
  flexible loads
• Bill comparisons
• Usage history relative to similar customers
• Support building energy rating

• Sub-metering for master-metered buildings
• Dashboard products and building controls that
  inform actual usage
• Pilot smart meters and devices for
  price-responsive load control (prices to
  devices)
• Smart Grid to scale-up clean distributed
  generation ? net zero energy buildings

• 20 by 2020

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 6 Community Initiatives to Scale-Up
• Community participation in NJ efficiency programs
  
• Improve municipal facility energy performance
• Social marketing campaigns to encourage program
  participation be part of the solution
• Support door-to-door direct installation
  initiatives for residents and small businesses

• Community-wide energy efficiency initiatives ?
  achieve specific energy reduction goals
• Municipal financing ?property-owners repay
  efficiency loans on property tax bill
• Community workforce development initiatives
  vocational training, community colleges, CEET

• 20 by 2020

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 7 Consistent Evaluation, Measurement and
  Verification (EMV)
• Prove the efficiency resource
• Maintain comprehensive multi-year EMV plan to
  inform
• Regulatory oversight of and accountability of
  ratepayer funding
• Program planning, goal setting and budgeting
• Progress towards goals - energy, environmental,
  economic
• Program implementation and resource allocation
• Award of performance incentives
• Program participation in PJM capacity markets

• 20 by 2020

• Fund EMV (3-5 of program costs)
• Provide statewide
• EMV protocols, tools, inputs
• Cost-effectiveness protocols, tools, inputs
• Coordinate with regional and national EMV

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 8 Workforce Development
• Train and credential a wide range of green jobs
• Engineers, architects, designers
• Tradesmen and women, builders, contractors,
  installers
• Auditor, inspectors, building energy raters
• Program planners, managers and evaluators
• Financial product manager
• Use reach of
• Universities, colleges and community colleges
• Technical and vocational schools
• Community development, trade and professional
  associations
• Labor unions and employer training programs
• Coordinate statewide e.g., NJ Department of
  Labor - Industry Workforce Advisory Council

• 20 by 2020

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 9 Ongoing Learning and Innovation
• Give NJ Efficiency Utility goals and budgets to
• Attract creative ideas
• Vet and fund promising delivery approaches
• Assess new technologies and program designs ?
  controlled studies and field trials
• Improve or discontinue technologies, approaches
  not delivering

• Efficiency Utility ?Efficiency Technical
  Committee
• Utilities, academia, state agencies, stakeholders
  
• Review, vet new options for cost-effective
  savings
• Complement EMP expansion of Edison Innovation
  Fund
• Clean Energy Technology Commercialization Fund
• Clean Energy Manufacturing Fund
• Energy Institute of New Jersey

• 20 by 2020

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NJ 2020 Energy Efficiency Strategy
Recommendations

• 10 Regional and National Coordination
• Efficiency ramping up across the region ? from
  850 million in 2008 to 2 billion by 2011
• Manage and leverage this policy convergence to
• Build market momentum
• Facilitate a culture to value increased energy
  efficiency
• Engage the muscle and creativity of the market
  place
• Address increased demand for high efficiency
  products

• 20 by 2020

• Coordinate with relevant regional and national
  efforts
• Consistent messages,
• Common standards, specifications, definitions,
  protocols
• Share learning, RD costs
• Many vehicles NEEP, NASEO, CEE, ASERTTI, ASE,
  etc.

25
NJ 2020 Energy Efficiency Strategy Transition
Plan

• Financing the Efficiency Expansion
• 11.2 billion over 12 years - 6.8 billion
  public/ratepayer 4.4 billion participant cost

Inflation adjusted dollars not net present
value
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NJ 2020 Energy Efficiency Strategy Funding

• Financing the Efficiency Expansion
• Ratepayer Funding Efficiency as a Least Cost
  Resource ?increase from 16 per capital to year
  up to 50
• Establish non-regulated heating fuels efficiency
  charge
• Access federal funding ? apply stimulus funding
  (e.g., oil heat)
• Direct market-based revenues to fund efficiency
• RGGI
• PJM RPM Revenues from efficiency program
  participation
• Utility Financing on-bill and companion bill
  financing

• 20 by 2020

• Municipal Financing Clean Energy Tax District
• Bond to create municipal fund for local
  efficiency investments
• Repayment with property tax bill
• Legislation approved in CA and Colorado

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NJ 2020 Energy Efficiency Strategy Funding

• Financing the Efficiency Expansion
• Leveraging private investment
• Energy Service Companies
• Performance based financing
• Focus Institutional and municipal buildings
• Secured, wholesale energy efficiency loan fund
• Offer attractive wholesale interest rates to
  retail lenders
• Sourced by private capital
• Secured by the State
• Dedicated energy efficiency deposit fund
• State financial account deposits to a local bank
• Deposits exclusively fund energy improvements. 
• Energy Efficient Mortgages
• State and Federal Tax Incentives and Credits

• 20 by 2020

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NJ 2020 Energy Efficiency Strategy Funding

• 2010 as Transition Year
• Establish the NJ Energy Efficiency Utility
  concept
• Adjust BPU program plan, budget filing
  requirements and schedules
• Make financial resources available to implement
  the plan
• Develop, approve a Statewide 2010 Program Plan,
  Goals and Budget

• Transfer OCE Programs to NJ Energy Efficiency
  Utility
• Expand CEEEP responsibilities and funding to
  provide technical support to the BPU
• Establish a Public Policy Agenda to complement
  programs

• 20 by 2020

29
Thank You

•  

Susan Coakley Executive Director 781-860-9177
ext. 112 scoakley_at_neep.org
www.neep.org