Potential, Cost, and Impact of DSM: Role of Load Research
and Evaluation, Monitoring, and Verification (EM&V)
Dr Amol Phadke, LBNL
NPTI DSM Training Workshop Nov 2010
Outline
 Estimating DSM Potential: Role Load Research
 DSM Costs – Simple ways to compare with
supply side resources
 Estimating DSM Impact: Role of EM&V
 Putting in all together – Super Efficient
Equipment Program by BEE (presentation on
behalf of Dr Garg, BEE)
DSM Potential Estimate and Load
Research : Hands on exercise
 What is the morning peak contribution of
electric water heaters in
 Your city
 Your state
 Overall in India
 If all electric water heaters are replaced by
either solar or gas water heaters, how much peak
power will be saved
 Any guess for India peak demand
 100 MW, 500 MW, 2000 MW, 5000 MW, 20,000
MW???
Key information needed
 Consumption
 kW
 kWh
 Number of water heaters (penetration)
 Usage pattern
 Future trends
Load Research Basics
 Need to sample – surveying all consumers not
possible and not needed
 Are customers being surveyed similar to your
customer base in general ?
 Deciding the use of meters, survey questions, bill
information, system data
Load Research: Hands on Exercise
 Estimate the penetration per household and
usage (number of hours per year) of the
following appliances







Lights (CLFs, tube lights, incandescent)
Fans
TV
AC
Water heater
Refrigerator
Computer
 Estimate the average morning (9-10 am)and
evening peak demand (8 pm) of households in
the group
 Max in the group and min in the group
Demand Side Power Purchase: Basics
 Demand side Power Purchase is a bundled set of
energy efficiency (EE) programs that are
designed to deliver the energy and capacity
equivalent of a power purchase on the supply
side.
– purchase “negawatts” and “negawatt-hours”
that are functionally equivalent to the
kilowatts and kilowatt-hours procured
– Can resemble a conventional peaking power
purchase by emphasizing efficiency measures
(and demand response) that reduce electricity
during periods of peak power consumption.
– Can resemble a base-load power purchase
emphasizing measures to reduce consumption
during all hours of the day.
System Profile: CEB Total
Average Load Factor = 54.4%
Average Peak on a Typical Peakday = 1,240 MW
Average Peak on a Typical Weekday = 1,191 MW
Average Peak on a Typical Weekend = 1,117 MW
1,400
Peakday
Weekday
1,200
Weekend
1,000
800
600
Typical
Peakday
Typical
Weekday
400
Typical Weekend
200
24:00
23:00
22:00
21:00
20:00
19:00
18:00
17:00
16:00
15:00
14:00
13:00
12:00
11:00
10:00
9:00
8:00
7:00
6:00
5:00
4:00
3:00
2:00
0
1:00
Typical Average Shapes, (1999 & 2000 Data)
Load Research Results: Examples
Customer Class
System Profile: CEB by Sectors
Typical Weekday
Load at
20:00
Bulk
Domestic
Losses*
LECO
Small C&I
Misc
(Street Lighting etc.)
Contrib to
Sys Peak
195 MW
431 MW
315 MW
137 MW
84 MW
21 MW
% Customer
Population
16.4%
36.2%
26.5%
11.5%
7.1%
1.8%
0.21%
86.5%
----------13.3%
------
% Sales
39.6%
31.0%
-----16.2%
12.4%
1.1%
500
CEB System
400
350
300
250
200
150
100
*Distribution Losses (Technical & Non-Technical)
24:00
23:00
22:00
21:00
20:00
19:00
18:00
17:00
16:00
15:00
14:00
13:00
12:00
11:00
10:00
9:00
8:00
7:00
6:00
5:00
4:00
3:00
0
2:00
50
1:00
System Load (MW)
450
End-use wise results
Domestic Load by End-Use
% Sector kWh
42.3%
Lighting
% System kWh
10.5%
Contrib to System Peak
22.8%
TV
14.9%
03.7%
06.6%
Fan (Ventilation)
14.9%
03.7%
02.9%
Refrigeration
10.7%
02.7%
01.4%
300
Lighting (Total)
Fan
Electric Cooking
TV
Refrigerator
Misc (Base)
Air Conditioners
Storage Heater
200
150
100
24:00
23:00
22:00
21:00
20:00
19:00
18:00
17:00
16:00
15:00
14:00
13:00
12:00
11:00
10:00
9:00
8:00
7:00
6:00
5:00
4:00
3:00
0
2:00
50
1:00
Load (MW)
250
DSM – Simple Ways to Compare With
Supply Side Resources
Will you Approve This Peak Load
Power Purchase?
One year contract
Rs/Unit
500 MW during the four hours of
evening peak over the year = 730
GWh
Mysterious
Regular
1.2
5
Total Cost Rs Cr/ Year 88 Cr.
365 Cr.
What is Demand Side Power
Purchase?
 Saving 400 MW during the evening peak hours
at the load end > 500 MW generation at the bus
bar
 What does it take to saving 400 MW at the load
end
 Replacing ~ 88 lack incandescent with CFLs
 45 Watt saving/replacement ; 88 lack replacements ~
400 MW saving
 How much does it cost
 If the utility decides to give the CFLs at the price of
incandescent lamps, 100 Rs subsidy needed/bulb
 Total expenditure 88 Cr: less that one third of the
expenditure of the supply side !
Comparing Supply and Demand Side
Power Purchase
Cost of demand side power purchase per unit =
(Annualized incremental capital cost)/(saving per
year )
CFL example = (88 Cr)/(730 GWh) = 1.2 Rs/Unit
One important different: Demand side power
purchase appears happens at the consumer end
(avoids losses)
Power purchase cost of 5 Rs/Unit translates to more
than 8 Rs/Unit when it lands at the consumers
doorstep due to lossess
Many Demand Side Power Purchase
Options: Delhi Example
CFL
T5
LPG WH
NG
WH
Solar WH
AC
Refrigerat
ors
Peak power
saving at bus bar
(W)
49
29
2,647
2,647
2,647
233
13
Total Energy
saving kWh/yr
79
46
529
529
529
565
133
Cost of Demand
Side Power
Purchase
Rs/kWh
1.29
2.25
2.74
1.26
5.00
1.16
0.70
Demand Side Power Purchase: Merit
Order Stack
Preliminary Estimate of the Saving Potential (MU) in 3 years
(Residential)
8.0
AC(R)
7.0
Avoided PP Cost
Rs/kWh
6.0
Utility Benefit
T5(R)
5.0
SolarWH(N+R
Average Tariff
4.0
`
3.0
LPG WH(N)
Consumer Benefit
T5(N)
2.0
AC(N)
CFL(R)
CFL(N)
NG WH(N)
1.0 Refrigrtr(N)
CCE
0.0
0
200
400
600
800
1000
1200
Cumulative Saving Potential in 3 years MU FY2008 to FY2011
CCE Rs/kWh
Avoided PP Rs/kWh
1400
1600
Least Cost Power Rationale: DERC
Example
“ The Commission is keen to see that distribution
licensees undertake DSM initiatives, not only
because DSM initiatives provides an opportunity
for conservation of power use but also because
these initiatives when integrated with supply,
provides a least cost solution for distribution
licensees to meet their power demand”
ARR and Tariff Impact of Demand
Side Power purchase
ARR and Impact on Consumer
One line summary
If the demand side power purchase is less half of
the cost on the supply side, impacts on the
consumer are going to be positive!
Impact on ARR
Goal: meet 1000 MW of demand increase during
the four peak hours in the evening
- Supply side power purchase
- Sign a bilateral contract of 1000 MW for evening peak
delivery (1460 GWh delivered during the evening peak
hours over the years)
- Addition to the ARR: 730 Cr
- Demand side option
- Facilitate the replacement of 1.7 Cr incandescent by
providing Rs 100/bulb rebate to the consumer
- Addition to ARR: 170 Cr
Impact on Tariff & Bills
 How is the increase in ARR typically is met




Tariff increase
Increase in government subsidy
Improvement in operations
Increase sales to high paying consumers
 If the increase in ARR is lower for demand side
power purchase
 Tariff increase can be mitigated
 Need for government subsidy can be reduced
 If the Rs 730 Cr of power purchase cost on the
supply side is used for demand side power
purchase, more than three times the units can be
purchased and could potentially eliminate
shortages !
IV: Implementing Demand Side
Power purchase
Topics Covered
 Role of Regulators
 Role of Utilities and Implementation Models for
Demand Side Power purchase
 Next Steps and Potential Agenda
Role of Regulators
 Establish clear goals for DSM power purchase
based on potential estimates
 Allocate resources from ARR for DSM power
purchase
 Provide guidance/regulation to facilitate
implementation of DSM power purchase
 Tariff options for promoting demand side power
prucahse (can either viewed as pumped storage
or peak power purchase)
MEASURING IMPACT OF
DSM: ROLE OF EM&V
Types of Evaluation
Evaluation
Category
Phase at which
Implemented
Pre-program planning
phase (a priori)
Formative
Implementation phase
(post-hoc)
Outcomes
Implementation phase
(post-hoc) and/or postimplementation (ex-post)
Evaluation Type
Assessment Level
1. Market assessment (includes market
characterization, baseline studies)
Market and/or
Program
2. Potential or feasibility studies
Market and/or
Program
3. Process evaluation
Program
4. Impact evaluation
Program
5. Market effects evaluation
6. Cost-Effectiveness evaluation
Program & Market
Program or Portfolio
Formative EM&V
• Used to improve existing and future programs
• Energy Efficiency Potential Studies – What is the potential for
additional energy savings by market segment
• Market Assessment and Saturation studies
– Residential Appliance
– Commercial End Use
– Industrial/Manufacturing end use
–
Change vs. Impact
In the Absence
Of the Program
Energy
Use
Installation
Change
Impact
Actual
Baseline
Time
28
When Do You Evaluate?
(Impact Evaluations Only)
Installation
Energy
Use
Pre-installation
Period
Post-installation
Period
Time
29
DSM Programme in India
- Concept of SEEP
Presentation by
Dr Sandeep Garg
Energy Economist
Bureau of Energy Efficiency30
The Appliance EE Challenge:
Global appliance electricity consumption
expected to double in 25 years
12000
10000
8000
Four appliance
categories, each with
major efficiency
potential, constitute
about two-fifths of
residential
consumption.
Misc (approximate)
Electric Water Heating
Electric Space Heating
StandBy
TWh
Oven
6000
Fan
Laundry
4000
Television
AC
2000
Refrigeration
Lighting
0
2005
Source: LBNL, May 2010
2030
Savings Potential in Appliances
Saving potential in household and commercial appliance is about 57
B KWh per year in 2013.
Source: Prayas Energy Group
32
Possible Impact of SEAD
Electricity use of appliances constitutes about 22% of consumption
The average annual growth rate of these appliances is between 10-15%
Stock
in million
Billion KWh/year
Total
Billion KWh
246
112
27.60
Saving potential
(%)
Savings in
billion KWh
Type of appliance
Fan
Incandescent bulb
302
80
24.22
Refrigerator
37
588
21.95
Television (TV)*
99
175
17.27
Tube light
280
107
30.08
Air conditioner
5
1199
6.05
Room heater
9
555
5.00
29
8.0
73
17.7
45
9.9
30
5.2
27
8.1
20
1.2
20
1.0
25
Electric Water heating (Geyser)
Air cooler
10
19
438
195
Stand-by-power
Washing machine
Total
4.58
3.70
3.06
15
185
2.77
145.30
1.1
25
0.9
20
0.6
25
33
0.7
57.4
Impact of SEEP on DSM Programme
Decreasing Transaction Costs
Manufacturer
Manufacturer
Rebate Program
implemented
Globally (or
Regionally)
Manufacturer
Rebate Program
implemented by
Utility
Wholesaler
Retailer
Customer
Customer Rebate
Program
implemented by
Utility
Utility
State/
National
Province
Decreasing Transaction Costs
Regional/
Global
Transaction costs
reduces by:
(1) Enlarging
geographical scope of
the program, moving
from utility to state,
national and then global
programs; and the
(2) Product chain
stakeholders starting
from the customer and
moving upstream to
retailer, wholesaler and
finally the manufacturer.
SEEP could aggregate
34
of
SEE
demand
SEEP – Leveraging Energy Savings
Establishment of SEE
Establish specifications for ‘superefficient’ devices
Cost-benefit analysis and of
period of incentive
Regulatory Approvals
Allow regulatory charge as a part
of ARR of Utilities
Creation of DSM fund for
collection of regulatory charge
Implementation of RMSDP
Monitoring sale of SEE in Utility
coverage area
Allow payment of incentives to
manufacturers
Labeling of
‘superefficient’
equipments
(SEE)
Determination
of incentives
based on peak
load reduction
Monitoring
sale of SEE,
verification
and
incentive
35
payout
Mechanics of SEEP
Incentives for SEE The incremental cost of SEE is within reasonable limit as compared to
normal equipment.
The Standards and Labeling programme of BEE has initiated market
Direct Procurement by Utility
The incremental cost of SEE is many times higher that a similar inefficient equipment (like LEDs vis-à-vis the incandescent bulbs).
The technical standards are in an evolutionary stage and the testing
facilities are not adequate.
Project Based SEE Deployment
Encourage project development by utilities to promote DSM under a
regulatory oversight
Provide a suitable payment security mechanism by leveraging the
regulatory charge to encourage ESCOs.
36
Mechanics of SEEP – Building Blocks

In-principle approval of FOR

Selection of Equipments

Technical specifications of Selected Equipments

Calculating the amount to be recovered from
ARR of utilities

Monitoring of SEEP

Payment of Incentives/Procurement Costs

State Specific Regulatory Approval

Evaluation and Impact Analysis

Project Based Intervention
37
Interface with Climate REDI- SEAD
•Concept of incentives to manufacturers for sales of SEE – exchange
of information and best practices/ coordination
•Harmonisation of technical standards in most equipments not
feasible – except in some products for which common international
specifications are possible- eg. TVs
•Harmonisation of testing procedures
•Exchange of technical information and expertise
•Capacity building of Utilities/ regulators/ Manufactures, etc
• Need of seed fund to kick start the process- BEE is in the process
of seeking funds from Government – possibility of enhanced
funding to this seed fund
38
The Appliance EE Challenge:
Growing global demand
Five global
suppliers produce
~60% of televisions
Source: LBNL, June 2010
Fifteen global suppliers
produce ~75% of major
appliances
Five global
suppliers produce
~45% of
room ACs
June 9, 2010 Energy Star List
The Opportunity:
Untapped energy savings potential from highly-efficient commerciallyavailable devices
Energy Star and California Performance Tiers
CA T20 Tier 1
(2011 MEPS)
Dots show commercially-available TVs that are more efficient than Energy Star 4.0.2
BUT… about 60-70% of TVs sold in North America are less efficient than Energy Star 4
Source: Noah Horowitz, NRDC, May 2010
SEAD is a global market transformation initiative for superefficient products
“Push” with
mandatory
standards
“Pull” with
incentives/labels
Number of Customers
Market
transformation
Business
as usual
Energy Intensity
SEAD increases the benefits of appliance EE programs
through global coordination
Number of Customers
1) “Raise the ceiling” by coordinating incentives
“Push” with
“Pull”
with
for highly-efficient globally traded devices (e.g., mandatory
incentives/labels
employing
similar definitions of tiers)
standards
2) “Raise the floor” by coordinating and
accelerating MEPS schedules and engaging in
relevant
Markettechnical exchange
Business
transformation
as usual
3) “Strengthen the foundations” by dialogue on
test methods, certification data sharing,
policymaker toolkit development, and technical
support
Energy Intensity
One possible “quick start” area: Ceiling fans




Major Indian interest (20% of household energy use; Prayas estimates DSM
program could avoid 6 TWh peak consumption by 2020)
Ceiling fans consume ~10 TWh/year in U.S. (~3 500 MW power plants)
Several US utilities provide incentives for Energy Star fans
DOE has authority to consider ceiling fan MEPS
“Tier
1”?
Source: Prayas Energy Group, March 2010
“Tier
2”?
“Tier
3”?
End-use Efficiency Lowers Electricity Sales and Can Lower Utility
Revenue
l
Increasing efficiency of use amounts to asking utility companies to reduce
sales of their product
l
How are utility companies to be compensated for existing capacity and
slower growth in future assets?
l
Not a problem in India because electricity shortage means saved electricity
can be sold to another customer, but first cost is an issue
l
Maharashtra Electricity Regulatory Commission has
allowed utility companies to pass along all costs of
demand-side management programs to customers
Example of SEEP
Example of SEEP
Example of SEEP
Contact information:
Sandeep Garg (sgarg@beenet.in)
Bureau of Energy Efficiency
(Ministry of Power, Govt. of India)
4th Floor, Sewa Bhawan
R.K.Puram
New Delhi – 110066
www.bee-india.nic.in
48