Southwest Energy Efficiency Project (SWEEP) - Arizona Sierra Club

Southwest Energy Efficiency Project (SWEEP) - Arizona Sierra Club

Arizona Energy Efficiency Project

Sierra Club

Energy Efficiency and

Arizona’s Energy Future

Jeff Schlegel

Southwest Energy Efficiency Project (SWEEP)

March 17, 2009

Southwest Energy Efficiency

Project (SWEEP)

• Public interest initiative promoting greater

energy efficiency in AZ and southwest states

• Founded in 2001

• Board of Directors includes utility, state

government, national laboratory, and private

sector representatives

• Funding provided by the Energy Foundation,

Hewlett Foundation, U.S. Department of Energy,

and the U.S. Environmental Protection Agency

Clean and sustainable energy

• Renewable energy

– Distributed (on homes and


– Central plant/CSP/wind farms

Energy efficiency

– Demand-side management

(DSM) programs, building codes,

appliance standards

• Clean distributed generation (CHP)

• Goals and portfolio standards

• The near future – carbon regulation,

transportation (plug in hybrids,


What is energy efficiency

• Using energy “more wisely”

• Using technologies and systems that use

less energy to do the same amount of

work, to provide the same level of service

• Opportunities in all energy end uses:

lighting, heating and cooling, motors and

drives, industrial processes

• “Energy efficiency” generally includes

energy conservation

Benefits of Energy Efficiency

Energy efficiency is

good for:

– Customers (consumers

and businesses)

– The utility system

(electric and gas)

– The economy

– The environment

Energy efficiency…

• Is the lowest cost energy resource – only 2 to 3

cents per kWh saved

• Can reduce customers’ energy bills by 10% to


• Would create over 12,000 new jobs in Arizona by


• Would keep more of the energy economy in

Arizona (currently, $6 billion of the $10 billion

that Arizona businesses and consumers spend

on energy leaves the state each year)

Today: Arizona’s electricity is


Rapid Growth and the Pressure on

Infrastructure and Energy Prices

Arizona utilities forecast that electricity demand

will grow about 3.5% per year, compared to

less than 2% for the nation on average.

• Rapid growth in electricity demand puts

upwards pressure on energy prices, stresses

the energy infrastructure, increases risks and

threatens reliability, consumes water, and

increases air pollution and carbon emissions.

Energy dollars flowing out of state put a drag

on the economy ($10 billion/year leaves AZ).


Choices at the Crossroads

• How will the energy needs be met

• Which energy resources will be chosen

• Who will pay the billions How

• How will Arizona choose to grow

• A combination of energy efficiency and

renewable energy can meet the future energy

needs of Arizona consumers and businesses,

while providing significant benefits to utility

customers, the energy system, the economy,

and the environment.


Energy Efficiency Reduces Peak

Demand and Demand Growth

Summer Peak Demand (MW))

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Base Case Forecast Forecast with SWEEP EES (15% by 2020)

Forecast with WGA Goal (20% by 2020)

Greenhouse Gas Emissions

Arizona Greenhouse Gas


Source: AZ CCAG Climate Change Action Plan, Final Report, August 2006

Arizona Greenhouse Gas

Emissions are Growing

• Increasing Emissions in Arizona

Arizona’s GHG emissions increased by nearly

56% between 1990 and 2005

Arizona’s GHG emissions are projected to

increase by about 148% over 1990 levels by

2020, and 200% by 2040

– The majority of Arizona’s GHG emissions are

from transportation and electricity production

Arizona Set Greenhouse Gas

Reduction Goals

• Governor set

goal to reduce


gas emissions

to year 2000

levels by 2020

• Governor also

set goal to be

50% below

year 2000

levels by 2040

Electricity GHG Emissions are

Growing Faster than Total Emissions



Source: AZ CCAG Climate Change Action Plan, Final Report, August 2006

Energy Efficiency Provides 1/3 of

the GHG Reductions, and $5.5

Public Support for Clean Energy:

Poll of Arizona Voters

• 87% of the electorate prefers to address Arizona’s

current energy situation by “increasing energy efficiency

and using more clean energy sources like wind and

solar power” rather than by “importing more electricity

from coal power in other states.”

• 83% of Republicans, 89% of Independents and 91% of


• 89% of Arizonans say they would be willing to pay

higher energy prices in order to increase the amount of

the state’s energy needs which are met by renewable


Survey of 600 registered voters throughout Arizona conducted in February 2007 by Lori Weigle

of Public Opinion Strategies, the largest Republican polling firm in the nation.

SWEEP Recommendations

• Design and implement cost-effective energy efficiency

programs in the utility sector

• Adopt energy efficiency goals and funding mechanisms

to support utility sector energy efficiency programs

• Upgrade building codes, support code implementation

• Adopt appliance/equipment standards

• Promote highly efficient new buildings (zero-net energy)

and beyond-code building standards

• Adopt “best practices” in public sector energy

management to lead by example

• Adopt utility rate, pricing, and market reforms

• Incorporate EE in air pollution control strategies

Energy Efficiency Strategies & Policies

Common Types of Utility Energy

Efficiency Program Strategies

• Financial incentives (rebates) for households that

purchase efficient appliances, air conditioners, lighting

products and controls, or shell measures

• More efficient and better operated residential and

commercial air conditioning systems, with quality

installation by trained contractors

• Grants for low-income home weatherization

• Direct installation of energy efficiency measures in

homes and businesses

• Audits/assessments and financial incentives for

businesses that upgrade energy efficiency

• On-the-bill customer repayment for energy efficiency


• Training, certification and outreach to builders,

contractors, and energy service providers

Other Energy Efficiency


• Up-to-date building energy codes along

with training of builders and contractors

to support building codes and code


• State appliance efficiency standards and

support of federal standards

• Income tax credits or sales tax

exemptions for households or

businesses that purchase highly efficient


• Electricity pricing reform to provide

greater incentive for conservation; e.g.

through inverted block rates

• Training and technical assistance for commercial and

industrial facility managers

• Design assistance and incentives for builders and

Energy Efficiency Programs

• Residential new construction

• Retail products (lighting and appliances)

• Residential existing homes, with HVAC

and quality installation, home


• Low income weatherization

• Commercial & industrial new construction

• C&I existing facilities retrofit (large/med.)

• Small business (direct marketing, direct

install, contractor delivered program)

• Schools and government facilities

New Homes – Three Part Approach

• Push the envelope

– Homes that meet the

federal tax credit (50%

more efficient) and “nearzero”

energy homes

• Mainstream/mass market

Energy Star/Power Wise


• Bring up the bottom

– Building energy codes

and standards, with code

support and training

Commercial New Construction

• Early alert and lead generation system – identify

projects years in advance

• Design assistance and technical support during

the design process

• Financial incentives to encourage design and

installation of very efficient measures and to

reduce first cost reengineering

• Leverage LEED and other systems

• Commissioning to ensure the building performs

as designed

Energy Efficiency and

Transmission Planning

• Planning for a system growing at

2.0-2.5% annually is different

than planning for a system

growing at 4%

• Peak demand impacts of EE

programs and policies are higher

than average energy impacts

Energy efficiency and other DSM

can be geographically targeted

to load centers and substations

• EE can be ramped up relatively


Policy forums in Arizona

Arizona Corporation

Commission (ACC) – utility


• Salt River Project (SRP) -


• State legislature

• Governor’s office and state


• Cities and counties

• Congressional delegation

Examples of SWEEP

actions in AZ policy forums

• Corporation Commission (ACC) – DSM savings

goals, budgets, programs, including intervention in

rate cases

• Legislature including HB2337 energy standards;

buildings; contracting, 2332 schools; energy

contracts, 2335 improvement districts; renewable

energy (2009), HB2766 energy omnibus act (2008),

appliance standards (2005), and state savings goals

• Governor – appointee (active participant) in

Governor’s Climate Change Advisory Group

(Climate Change Action Plan)

Federal Economic Stimulus Bill

Energy Efficiency

– Appropriations

• To the Department of Energy (DOE) for state, local

and Tribal Assistance

• To other federal agencies

– Tax Provisions

• Increased allocations of qualified energy

conservation bonds

Energy conservation incentives

Federal Economic Stimulus Bill

• $16.8 billion to DOE for energy efficiency

and renewable energy.

– $11.3 is for energy efficiency

• $3.1 billion for State Energy Conservation Plans

(State Energy Program)

• $3.2 billion for Energy Efficiency Block Grants

• $5.0 billion for Weatherization Assistance

Southwest Energy Efficiency Project (SWEEP)

Jeff Schlegel

520-797-4392 Tucson office

520-907-1088 mobile

Beth Nelson


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