Local Government Quantified Savings Component of Strategic Plan Update

©2013 Navigant Consulting, Inc. Confidential and proprietary. Do not distribute or copy.

E N E R G Y

DI SPUTES & I NVEST I G ATI ONS • ECONO MI CS • F I NANCI AL ADVI SORY • MANAGEMENT CONSULT I NG

October 15, 2014

Local Government Quantified Savings Component of Strategic Plan Update

Navigant Reference: 150283

Technical Appendix - Final Presentation

In collaboration with Tierra Resource Consultants

2©2013 Navigant Consulting, Inc. Confidential and proprietary. Do not distribute or copy. E N E R G Y

Meeting Protocols

Meeting Protocols• For the webinar unplugged to be a success, all callers will need to have their

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Meeting Agenda and Project Objectives

Meeting Goals and Agenda1. Quick review of project objectives.

2. Quick review of the methods used to establish energy efficiency metrics (i.e. EE potential) for goals 1, 3, and 4.

3. Present final energy metrics for goals 1, 3, and 4.

4. Present insight into additional sources of EE savings for LG’s that are not included in the metrics.

5. Discuss limitation of the analysis.

6. Discuss recommendations.

Project Objectives

7. Establish energy metrics (i.e. EE potential) for goals 1, 3, and 4 for the Local Government EE Strategic Plan Action Plan.

a. Note that Navigant did not develop a metric for Goal #2 because metrics for that goal did not align with the Potential and Goals Study model.

8. Define a template that could be used to establish EE goals and metrics for other components of the California Strategic Energy Plan.


Methodology for Goal #1

Method for Estimating Goal #1

• First the team estimated baseline LG energy usage for each IOU territory based stakeholder discussions and data obtained from IOUs on 2012 electricity and natural gas sales.

• A ratio was then develop by dividing the LG baseline usage by the full commercial sector usage.

• This ratio was then used to estimate LG potential as a percent of total commercial market technical, economic, and market potential.

IOUFuel Type

LG Facilities Share of Commercial

Sector Consumption*

PG&E Electric 3.38%SCE Electric 3.36%

SDG&E Electric 3.37%PG&E Gas 2.01%

SDG&E Gas 1.44%SCG Gas 1.72%*

Technical Appendix Table 7. Estimated LG Facilities Consumption as a Percent of Commercial Consumption


Methodology for Goal #1 - Example of LG Energy Consumption

PG&E 2012 LG Related Energy Sales

Electricity sales are distributed between;

• Facilities

• Street lights

• Water supply

• Waste water treatment

Natural gas sales are distributed between;

• Power generation

• Facilities

Technical Appendix Figure 2. 2012 PG&E Local Government Electric Energy Sales Distribution by System

Technical Appendix Figure 3. 2012 PG&E Local Government Gas Energy Sales Distribution by System

60%16%

11%13%

Facilities Water Supply-Irrigation System

Sewage Treatment Facilities Street lights

73%

27%

Fossil Fuel Electric Power Generation Facilities


Proposed Metrics for Goal 1

Technical Appendix Figure 7. Goal 1 Incremental Annual MMTherms

Goal 1

Local governments lead by example by designing and implementing programs that reduce their own energy use and greenhouse gas emissions

Goal 1 Metrics

Between 2015 and 2020, achieve an average annual incremental ex-post gross savings of 27 GWh and 0.2 MM Therms from the implementation of standard efficiency measures (i.e., measures eligible for IOU rebates) captured in facilities owned and/or occupied by LGs.

Technical Appendix Figure 6. Goal 1 Incremental Annual GWh




• The 2013 potential included the capability to increase code compliance over time.

• Assume baseline code compliance rate increases by 10 percentage points.

• Applies to constituent and LG facilities.

• Applies to new construction and retrofit/replace on burnout.

• Attribution of savings from advocacy and code compliance enhancements to be established between LG and affiliated IOU.



Technical Appendix Figure 8. Goal 3 Incremental Annual GWhGoal 3

Local governments accelerate the implementation of energy efficiency, zero net energy and greenhouse gas reduction goals through the use of their regulatory authority.

Goal 3 Metrics

Between 2015 and 2020, achieve an average annual incremental ex-post gross savings of 29 GWh and 0.1 MM Therms from an increase of 10 percentage points in compliance with existing codes for new construction and renewal/renovation projects.





• Navigant assumes that the aggregate results from goals 1, 2, and 3, in combination with improvements in overall energy management, will increase the potential for energy.

• Improving energy management is a process and can occur in many ways. One example of this process might include the following 5 steps;

1. Include a complete analysis of historic usage load sources and load profiles.

2. Develop a clear and accurate understanding of the potential for energy efficiency that is based on engineering analysis such as technical potential audits, and covers the full scope of LG operations.

3. Establish the ability to develop and use guidance documents, such as strategic energy plans, to organize and direct sustained efforts at achieving energy efficiency over a long time horizon.

4. Organize an effective management structure that includes the ability to transition authority and commitment to a strategic approach to energy management as staff positions evolve and turnover occurs, and

5. Continuously improves the project delivery process to include increasingly complex projects that include data rich and real-time energy management capability.

• Metrics for goal 4 were estimated by multiplying the mid case scenario potential provided in goal #1 by a factor of 1.25.


Methodology for Goal #4 - Example of improving energy management as a process.

A Comparison of EE Savings Achieved by Two Similar Institutions

-

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

12-0

602

-07

04-0

706

-07

08-0

710

-07

12-0

702

-08

04-0

806

-08

08-0

810

-08

12-0

802

-09

04-0

906

-09

08-0

910

-09

12-0

902

-10

04-1

006

-10

08-1

010

-10

12-1

002

-11

04-1

106

-11

08-1

110

-11

12-1

102

-12

04-1

206

-12

08-1

210

-12

12-1

2

Ener

gy S

aved

(kW

h)

Date

Institution 1 Institution 2

Strategic Energy Planformally adopted

Bond funding for EE projectsauthorized by management



Goal 4

Local government and private sector energy management expertise becomes widespread and prevalent.

Goal 4 Metrics

Between 2015 and 2020, achieve an average annual incremental ex-post gross savings of 7 GWh and 0.05 MM Therms in addition to the metrics stated for goal 1.


Technical Appendix Figure 10. Goal 4 Incremental Annual GWh


Proposed Metrics Summary

Local government incremental market EE potential, by goal (GWh)

• Applies to consumption associated with facilities.

• Does not include potential for street lighting and water delivery / waster water treatment.

• Goals 1 and 4 are for LG owned/operated facilities.

• Goal 3 represent 10% improvement in compliance for both new construction and retrofit/replace on burnout projects for LG and constituent facilities.

• These goals indicate the potential exists to reduce electricity consumption in local government operated facilities by approximately 16% to 20%.

• This represented an estimated total reduction in annual LG electricity spend of approximately 9% to 12%.

Year 2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

Goal 1 29.6 30.9 29.1 20.9 23.4 27.1 30.6 34.3 37.8 41.4

Goal 3 32.6 56.8 32.1 22 18.3 13 7.1 3.6 1.7 1.1

Goal 4 7.4 7.7 7.3 5.2 5.8 6.8 7.7 8.6 9.4 10.3

Total 69.7 95.4 68.5 48.1 47.5 46.9 45.3 46.4 48.9 52.8

Technical Appendix Table 1. Local Government Strategic Plan Update Incremental Market EE Potential, by Goal (GWh)


Additional Potential for EE not in Metrics

Additional source of EE savings not in metrics• Street lights.

• For example, in PG&E’s service territory, streetlights are about 13% of total LG spend on electricity in 2012.

• Water delivery and waste water treatment facilities.• For example, in PG&E’s service territory, wastewater treatment and

water supply are about 11% and 16%, respectively, of total LG spend on electricity in 2012.

60%16%

11%13%

Facilities Water Supply-Irrigation System

Sewage Treatment Facilities Street lights

Technical Appendix Figure 2. 2012 PG&E Local Government Electric Energy Sales Distribution


Additional Potential for EE not in Metrics – Street lighting

• The potential for street lights was reviewed in detail in the 2013 potential model.

• As shown in figure 13, the potential exists to reduce streetlight energy use by about 45% through a mix of LED and induction lamp technologies and advanced controls.

• Potential varies by IOU according to who owns the lighting.

• Overall, the potential exists to reduce annual local government sector electricity consumption by about 7%.

Technical Appendix Figure 13. California Street Lighting Savings Potential as a Percent of CEC Street Lighting Forecast (Technical and Active Cumulative

Market Potential)

0%

10%

20%

30%

40%

50%

60%

70%

80%

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

GW

h

Technical Potential Economic Potential Mid Cumulative Market Potential


Additional Potential for EE not in Metrics – Street lighting

Street lighting ownership distribution and annual incremental potential for LGs, by territory.

IOU IOU-OwnedCustomer-

Owned

Statewide 57.1% 42.9%

PG&E 26.3% 73.7%

SCE 82.4% 17.6%

SDG&E 19.0% 81.0%

Technical Appendix Table 2. Street Lighting Ownership, by Lamp Count

Year201

5201

62017

2018

2019

2020

2021

2022

2023

2024

PG&E 11 11 10 9 8 8 7 7 7 6

SCE 3 4 4 4 4 4 4 4 4 4

SDG&E 1 1 1 1 1 1 1 1 1 1

Total 15 15 15 14 13 12 12 12 12 11

Technical Appendix Table 16. Total LG Streetlight Market Potential (GWh)


Additional Potential for EE not in Metrics – Water supply and waste water treatment

Water Service Type Measure

Upper Bound

Savings % of End-Use

Consumption

Average Savings % of

End-Use Consumptio

n

Market Applicabilit

y Factor

End-Use to Sector

Adjustment Factor

Applicable Average

Savings % of Total Sector Consumption

% Savings Potential

for all Water Service

Consumption

Potable & Non-Potable

Improved Motor Efficiency 6% 4.0% 5.0%

80.0%

0.2%

4.3%


Pump System Optimization 20% 12.4% 10.0% 1.0%


VFDs 50% 27.5% 10.0% 2.2%


Supervisory Control and Data

Acquisition (SCADA)

20% 15.0% 5.0% 0.6%

Non-PotableHigh Efficiency

Aeration Blowers 35.0% 10.0% 8.8% 0.3%


Other NA 11.2%

Potable & Non-Potable Potable & Non-Potable Total 100.0%

• The 2013 potential model did not analyze water supply and waste water treatment.

• Navigant undertook a quick very, high level literature review that indicates savings potential across all water service operations is over 4%.

• Overall, the potential exists to reduce total annual local government sector electricity consumption by about over 1%.

• Potential should be studied in detail.

Technical Appendix Table 35. Top Energy Savings Opportunities for LG Water Management


Limitations of the Analysis

Limitations of the Analysis• Since the PGT model was developed for a different purpose than the Strategic Plan

metrics, the results provided in this technical appendix represent order-of-magnitude, directional opportunities rather than precise estimates of potential for any single local government, end use measure category, or building type.

• The metrics for Goals 1 and 4 are specific for facilities for which local governments either owns the building, or for which they are the utility account holder of record. Many local governments are engaged with their communities to promote energy efficiency and create additional energy efficiency momentum with their constituents. These metrics for goals 1 and 4 do not include constituent facilities and do not reflect potential for LG constituent outreach efforts.

• Estimates of energy efficiency potential are limited by the requirements of the Potential, Goals, and Targets (PGT) project. The PGT work is based on all measures that will screen in a TRC cost test, and meet all other criteria for inclusion in IOU incentive type programs. Additional potential may be available under different TRC cost effectiveness thresholds or different cost effectiveness tests.

• The analysis of the potential for municipal water operations is preliminary and illustrative in nature, and should be viewed as an order of magnitude estimate only.


Limitations of the Analysis

Recommendations• Further research should be completed through the CPUC potential modelling efforts to

refine estimates of energy efficiency potential in water systems operated by local governments.

• The savings associated with goal 3 include savings from codes and standards related activities at LG facilities, and also constituent facilities. A more accurate assessment of this goal could be accomplished by more clearly establishing the relationship between IOU programs and LG activities in the realm of codes and standards.

• As new program delivery mechanisms that involve local governments are developed, such as PACE financing and regional energy networks (RENs), it is likely new sources of savings will be defined, and new methods to develop that potential will be implemented. In order to capture this potential, future revisions to the strategic plan metrics should be expanded beyond the definition of potential used in the 2013 potential study.

• Additional data on energy sales to LGs from SCE and SDG&E would allow more specific direction on where energy efficiency potential might be clustered at LGs operating in the service territories for these utilities.

• Additionally, most cities and counties have developed energy action plans (EAPs) as part of their carbon action planning process. These EAPs include details on usage for the three categories discussed above. The research team could not identify a source where all information from these EAPs has been collected and warehoused. Such a database would help further define where potential exists and how it could be most effectively captured.

Documents

Local Government Quantified Savings Component of Strategic Plan Update