The Total Cost and Measured Performance of Utility-Sponsored Energy Efficiency Programs

Abstract

By examining the actual performance of conservation or demand-side management (DSM) programs for ten utilities, Joskow and Marron (1992) have made an important contribution to policy discussions about the wisdom of relying on utilities to improve customer energy efficiency. We use Joskow and Marrons method to analyze twenty utility commercial lighting programs and, like Joskow and Marron, find wide variations in industry reporting practices and savings evaluation methods. We extend the method by systematically accounting for several of the most important sources of variation and comment on how they influence total program costs. Our accounting also allows us to relate remaining program cost variations to the program sizes and the electric supply costs avoided by the programs. We draw qualified, yet affirmative, conclusions regarding the cost effectiveness of the programs.

Energy demand‐side management: New perspectives for a new era

“…These modifications revealed that reported utility DSM spending may be more accurate than Loughran and Kulick claimed, a finding that supports Parfomak and Lave's original conclusions. Qualitative studies confirm the findings made by all three sets of authors that DSM efforts are cost‐effective and have significant potential to decrease electricity prices (Eto et al, 1996, 2000; Nadel, 1992; Nadel & Geller, 1996).…”

Preliminary assessment of the Louisiana Home Energy Rebate Offer program using IPMVP guidelines

“…6 Recall that this is one criticism associated with the PRISM methodology since the use of long-term weather conditions precludes daily analysis. 7 Entergy for example has 11 billing cycles throughout Louisiana.…”

“…Industrial and commercial facilities have evolved standard protocol for evaluating energy conservation programs, primarily because of the large capital expenses involved, but residential programs tend to be subject to less rigorous criteria and performance metrics. For a review of program assessments in commercial facilities, see [7,8]; for residential programs, [15]; for weatherization, [2,4,21].…”

Energy and American Society – Thirteen Myths

“…For example, a review of 40 large-scale commercial sector energy efficiency programs implemented during the early 1990s found that they saved electricity at an average cost of $0.032 per kWh, well below the cost of supplying electricity (Eto et al,1996). This study relied on post-program evaluations of energy savings, and included all utility costs as well as customer costs in its analysis.…”