The following thoughts on the Northwest Power and Conservation Council’s Ninth Plan and Climate Change were provided by David Baylon, the founder of Ecotope. David has over 45 years’ experience in the field of energy conservation and energy efficiency and has authored or coauthored many of the key studies that have informed the Northwest’s approach to energy conservation in both the residential and commercial building sectors. His background includes the design, implementation, and technical review for impact evaluations, field evaluations of emerging technologies, residential and commercial building stock assessments, code development and impact assessments, and Regional Technical Forum UES proposals.
We are looking for other NEEC members to contribute to this ongoing conversation and blog series exploring the industry challenges and economic opportunities of the clean energy future. If you are interested in engaging with us on this, please reach out to NEEC Executive Director, Kerry Meade at firstname.lastname@example.org.
The Ninth Plan and Climate Change
An open letter to the Northwest Power and Conservation Council
The Northwest Power and Conservation Council is scheduled to release a draft of its 8th Plan later this summer. The Plan, in its previous incarnations, has been a tool for forecasting regional electric demand, efficiency resources, and generation requirements for the region’s electric utilities over the last 40 years. Recent presentations of the 8th Plan modeling and resource assessment have pointed to a change in the electric utility landscape which results in a fundamental change in the Council’s resource planning. The effect of near-term cost trends in generating resources including utility-scale renewables and CCCT gas generation suggests that the cost advantage that efficiency measures have enjoyed over the last 40 years has suddenly eroded. The result is a substantial reduction in the region’s commitment to efficiency and demand-side programs in favor of these cheaper generating options. I believe that this analysis is flawed and that it ignores substantial changes that are coming to both the electric grid and the demands placed by “electrification” and/or “decarbonization” across the economy.
The developments of the last decade have brought into stark relief the challenge that we collectively face from climate change. It is established science that the cause of this change is our continued reliance on fossil fuels which allow us to use carbon stored from previous epochs. Over the last two centuries we have developed a system that has and will put a large part of that stored carbon back into the atmosphere as CO2 with the consequence of a much warmer planet with much less ice and much more fire. The rest of the established science is that the warming and its consequences will get much worse unless we can manage to burn essentially no fossil fuels in our near future.
In most of our region climate change has become an accepted political reality. In much of the West Coast the catastrophic wildfires have resulted in a climate focus in state legislatures and governors’ offices. This reality has become a matter of political importance in addition to the physics of the matter. Washington has passed a series of legislative mandates that place the Washington utilities on a path to remove fossil fuels from the electric system. The electric system is to be carbon neutral by 2030 and carbon free by 2045. Oregon has a similar goal and has set its Renewable Portfolio Standard (RPS) at 50% by 2040. This would apply to all generating resources beyond the legacy hydro systems. California has mandated that 60% of the electricity generated for the state be renewable by 2030. In both Washington and Oregon all existing coal fired generation would be completely removed from the state’s electricity supply by 2030.
In addition to these challenges the drive for electrifying the transportation system as well as the gas used in the building sector will add significant new loads to the existing and future electric grid. These changes would occur at the same time as the pressure to forego fossil-fueled electric generation is increased. Between the new load and the need to replace a substantial fraction of the existing system, a resource about the size of the Federal Columbia River Power System must be developed in the next 25 years just to serve electrification needs of this region. About 75% of that will need to be from renewable resources and/or conservation to meet just the Oregon and Washington requirements.
The region has faced a problem of this scale before. In the 1960s the region’s utilities committed to six nuclear power plants as the initial phases of about 23 such plants by 2000. The expense of this proposal (coupled with its absurdity) led to the Northwest Act in 1980. The idea that energy efficiency could offset much of the anticipated load growth became the basis for energy planning in the region. Over the last four decades we have conserved around 6000 MWa to offset the region’s economic growth.
The eighth plan has focused on least cost generation without significantly expanding the efficiency portfolio. The result is an almost complete retreat from the use of efficiency as both a resource and as a strategy to extend our efficiency resources into a more challenging future.
In the next three decades we will have to repeat the past success. In effect, double the impact of conservation and efficiency on the regional electric system. A move to tap levels of efficiency not tapped in the last 40 years will require a significant shift in our analytical approach to resource assessment. At the same time there must be a significant and equivalent expansion of renewable-based generating resources.
To achieve the efficiency goals the paradigm of energy efficiency linked to individual measures constructed in an ordered “supply curve,” while successful, will require significant changes. We will need to emphasize performance goals (e.g. overall energy use, electrification, GHG reduction, etc.) where costs are not incremental and may not be significantly different than base case alternatives. The “measures” are much less obvious and separating the performance into discrete measures is both difficult and useless.
This is particularly true of the building sectors. We have long known that much efficiency could be developed from design and controls which focus on the interaction between building components. Across all building sectors the implementation of such an approach has been limited and its impact on the region’s utilities negligible. Re-thinking the nature and goals of the supply curve will be a necessary consequence of this more wholistic approach, at least in the commercial and residential sectors. It would both support the nascent “pay-for-performance” measures in some utilities and place the region on a path that is essential to the decarbonization of our economy.
For the ninth plan (due in 2026) both the analytical tools and the approach to evaluation of the energy conservation will need to be reassessed:
- The analytical tools need to be in line with the goals of decarbonization across all sectors. For performance goals, both costs and savings should be assembled as goals not absolute measure costs.
- Performance standards for the building sector should be established. Utilities would develop programs that emphasize the overall energy use of both new or existing buildings and residences. Both commercial and residential sector buildings should be expanded and include integrated design that addressed all aspects of energy use.
- In all cases, the goal of decarbonization and electrification should be addressed in any planning forecasts. The 9th Plan should make it clear where we are in that process.
Over the next five years we need to develop efficiency programs that are more aggressive. We need to see buildings that meet the goals of Washington and Oregon for much reduced energy use and significant electrification. This will require a shift in the resource and savings assessment paradigm that has been used for the last three decades. It will also require that the Council become more supportive of the goals of the States in the effort to decarbonize their economies.