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decoupling Archives - Michaels Energy

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Grid-Interactive Efficient Buildings Part 4: Utilities Ask, Why?

By Energy Rant No Comments
This is the fourth in a series of posts on grid-interactive efficient buildings (GEBs). Here is a summary of the series: August 23 – Why GEBs? What is it, and why do it? August 31 – GEBs are difficult to achieve, beyond efficiency that should be done regardless. September 7 – What will customers think of this madness? Let’s peek at where we’ve been and where we are going. This series is based on a list of challenges noted in DOE's National Roadmap for Grid-interactive Efficient Buildings: Consumer awareness (Covered 07SEP21) Complexity (Covered 31AUG21) Utility interests (Today) Regulatory models Policymaker...
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PBR Me, and Spare the Ham

By Energy Rant No Comments
Last week we explored the mélange of combinations of energy efficiency portfolio administration, delivery, and evaluation among stakeholders, including public utilities’ commissions, utilities, for-profit and non-profit administrators, and program implementers. No two states are alike. This week we will discuss a few more things from the article in Public Utilities Fortnightly, Top Performing States in Energy Efficiency. Impact of Energy Efficiency Resource Standards (EERS) States have everything from carrots, sticks, both, or neither for meeting efficiency goals. Some states have energy efficiency resource standards. The map below, courtesy of ACEEE, shows recent EERS across the fruited plain. An EERS “is...
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Clean Power Plan (CPP) – The Next Layer

By Energy Rant No Comments
Last week, we scratched the surface of demons in the Clean Power Plan (CPP) details.  Let’s see what lies on the second layer below. There are two methods for counting, scoring, and achieving compliance in the plan: mass based and rate-based plans.  To recap, mass based is the simpler of the two. For starters, it includes one metric: tons of CO2 emissions from stationary power suppliers.  The second is, I believe, far more complicated.  Why?  Glad you asked. The rate based approach would appear to be an itty bit more complicated, like steaming broccoli versus steaming carrots.  The only difference...
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Lost Revenue Adjustment; One Patch in the Quilt

By Energy Efficiency, Energy Rant One Comment
This week, I dive into something I have wanted to know more about for some time: efficiency program funding mechanisms.  This post is based on a recent paper released by ACEEE, Valuing Efficiency: A Review of Lost Revenue Adjustment Mechanisms. Utilities must be allowed to make enough money to draw required investor capital, debt and equity, to fund their operations.  Energy efficiency programs are funded by ratepayers, one way or another – not out of shareholder charity.  All states with programs have some sort of transparent, although usually incomprehensibly confusing, means for cost recovery or lost revenue recovery. Although the ACEEE...
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Decoupling – A Love Story

By Energy Efficiency, Energy Rant, Utility Stuff 2 Comments
Perhaps I am naïve, but to be more effective it seems interveners would do well to understand motives of profit-driven enterprises and their customers.  Consider, for example, this recent article in Midwest Energy News lamenting CenterPoint Energy’s withdrawal from decoupling.  You may recall a post I made eons ago where I described the perverse impact of decoupling on prices for consumers.  Allow me to recap. Utilities have fixed cost of hardware and labor to deliver energy to customers – poles, wires, pipes, transformers, compressors, trucks, etc.  This stuff makes up the rate base and fixed cost of energy delivery.  They...
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Decoupling, Stupid

By Energy Efficiency, Energy Rant, Utility Stuff 2 Comments
One way the utility business works like the rest of the economy is that it sells its products/commodities at a price that is higher than the cost of production, on average.  The more utilities sell, the greater their gross profit.  This is at odds with utilities’ incentive to save energy with energy efficiency programs.  As a result, some utility executives are opposed to energy efficiency programs.  That is a short-sighted view but that’s a story for a different day. As a result of this dichotomy, a pricing mechanism known as decoupling has been developed.  This NREL paper gives a pretty...
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