The document discusses energy efficiency and its role in reducing strain on the electric grid in the Midwest region. It proposes creating a Midwest EM&V (Evaluation, Measurement, and Verification) Forum to standardize how energy efficiency savings are measured and valued across states. Doing so could allow energy efficiency to be treated more like energy generation and better integrated into regional planning and markets. The Forum would work to align different states' energy efficiency programs and policies.

1. Electric Breakout:
Can't We All Just Get Along?
The Case for Consistently Treating
and Incorporating Energy Efficiency
into the Regional Planning Process
Mid-Atlantic Regulatory Conference
Rapid City, South Dakota
June 6, 2011

2. MEEA’s Role in the Midwest
• Nonprofit serving 13 Midwest states
• 10 years serving utilities, states and communities
• Staff of 23 in Chicago
• Actions
– Advancing Energy Efficiency Policy
– Designing & Administering EE Programs
– Delivering Training & Workshops
– Coordinating Utility Program Efforts
– Regional Voice for DOE/EPA & ENERGY STAR
– Evaluating & Promoting Emerging Technologies

3. Transmission
• More than 160,000 miles of high voltage transmission
lines in the U.S.
• The system can be strained for a variety of reasons,
including
– High growing population centers
– Renewable resources not near existing lines
– The need to incorporate intermittent power sources
– Serving functions for which it may not have been designed
to serve
• Grid is designed to take supply but how can Energy
Efficiency be treated as a dispatched energy supply?

4. Role of Efficiency and the Grid
• EE Can Help Relieve the Grid Strain
– Moderates growing energy demand
– Reduce peak energy demand
– Savings can be quantified and forecasted
• EE can help reduce the future demand and the
need to build new power plants and transmission
lines
• Make utilities whole for losing energy sales
– Slowed demand defers generation and T&D investments
– Allow for lost revenue recovery
– Reward utilities for exceeding EE goals

5. Why EE vs. Just New Transmission?
• Cheaper than renewables or supply side options
– < 3¢/kWh
• Create local jobs and keeps money in local economy
– Clean-energy investments create 16.7 jobs for every $1
million in spending. Spending on fossil fuels, by contrast,
generates 5.3 jobs per $1 million in spending
• No NIMBY or BANANA issues (often opposite effect)
• Great PR/Customer satisfaction with EE and utilities
• Potential for integration of EE into RPS or Clean
Energy Portfolio Standards

6. Efficiency Combats Dollar Drain
• Midwest region - $40 billion per year leaves the economy to
pay for imported fossil fuels
• Savings potential comes from a combination of EE
programs:
– Natural gas EE
– Electricity EE
– Price drop through demand reduction
– Reduction of amount and cost of NG used in electric generation
• Potential Annual Savings for MW Region
– 2010: $4.4 billion
– 2015: $7.9 billion
– 2020: $10.4 billion

7. Estimated Annual Investment in Energy
Efficiency in the Midwest
EERS Legislative
Legislation
$1.800 • IL Gas
Committee
• WI EERS
Admin Order overturned
• IN Electric
$1.600
Earlier Statewide EE Admin Order
• MN EERS • WI Electric,
1983 – Pilot legislation Legislation $1.581
$1.400 1991 – CIP • MI Electric,
Gas
requirement adopted Gas
• OH Electric
$1.200 Earlier Statewide EE
Exec Order
• IA Gas,
• IA Electric
1990 – Initial legislation $1.191
$1.000
Billions
1996 – Legislation
updated EERS
Legislation
• IL Electric
$0.800 Earlier Statewide EE • MN Electric,
• WI Gas
1999 - Public Benefit
$0.600 Fund Adopted
$0.400
$0.390
$0.200
$0.000
2000
2011
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2012
2013
2014
2015

8. Future Midwest Efficiency Targets and Funding
2010 $1.06 billion
2015 $1.58 billion
Minnesota Wisconsin
1.5% elec current
0.7% elec currently
1.5% gas current
0.4% gas currently Michigan
1% elec by 2012
0.75% gas by 2012
Iowa Ohio
1.4% elec currently 2% elec by 2015
1% gas currently gas in discussion
Illinois Indiana
2% elec by 2015 2% elec by 2019
1.5% gas by 2017 gas none yet
2010 EE funding Kentucky
Voluntary elec and gas
2015 EE funding Missouri
(projected) IRP process
May 2011

9. What’s Keeping EE from Being
Treated as Generation?
• No pure measuring of kWh/therm generation and so need
way to count energy NOT used!
• Need consistent valuing of EE across state/utility
boundaries
– A way to determine kWh savings from a CFL should be the same
no matter the state (even if kWh savings are different)!
– EM&V results in the region (and nation) are divergent, even on the
same EE program implemented by the same company
• A kWh/therm of EE needs to become commoditized in
case of tradable Clean Energy Port Stds or sale to the Grid.

10. Solution: Midwest EM&V Forum
• Create a Forum for utilities and regulators to discuss and agree
upon the valuation and evaluation of EE
• Current Regional Issues Around Evaluation
– Different definitions of savings and reporting periods make comparisons across
programs or states difficult
– Different methods to measure savings making it difficult to address program
attribution, define metrics for policy objectives, assess broader market impacts
– Different levels of Commission review leads to a large range of uncertainty and
lack of confidence in claimed energy savings and use of deemed savings
– Aggregation of program savings into load forecasting frameworks is limited by
the uncertainty
– Efficiency and demand savings cannot be utilized in regional markets without
some consistency in approach
• Evaluation, Measurement and Verification is already a part of all
regulated EE programs, so bring together and streamline

11. Why Midwest EM&V Forum?
• Reason for a Midwest EM&V Forum at this time
– Efficiency programs, spending and savings goals have been growing
significantly in the region
– Credibility of savings estimates can be enhanced if there is some
agreement on a regional evaluation, monitoring and verification model
– Needed for instituting a forward capacity market
– Efficiency savings and demand response in regional markets can be
monetized if there is standardization and consistency
– Mass market research for program development and incremental costs
can be leveraged with regional information
– Money can be saved on estimating savings, and developing load shape
studies
– EE program designs across the region can be improved
– Leverage knowledge and lessons of regulators and staff across the
region

12. Next Steps for Midwest EM&V Forum
• Needed Actions for advancing the Forum
– Secure support for the concept
– Some future commitment of staff time to participate
– Prepare Midwest as roll out area for U.S. DOE EM&V actions
– Utilize some EM&V funding for regional support
• MEEA is coordinating with US DOE and regional stakeholders
– MEEA has the regional footprint, credibility and staff resources to
implement this project
– Bring US DOE messaging and goals to be consistent with Midwest
activities

13. Why Advance the Forum Now?
• Impact of November 2010 Elections
– Need to Educate on EE – What is EE & What are the
current statutes and regulations
• 9 new Governors (8 Republican/1 Democrat)
• State Senates (11 Republican Majorities)
• State Houses (10 Republican Majorities)
• 519 New Legislators out of 1595
– New PSC Chairs and change to Commissioners and staff
• Delays with program review and approval
• Need to educate on value of energy efficiency
• Need consistency of EM&V
• EEPS requirements continue to increase
• Difficult Economic Climate – state budgets tight

14. Energy Efficiency is a Bipartisan Issue
State House/Senate and Governor party affiliation at the time of the first enactment of
statewide energy efficiency policy
VT: D
D
MA: D
D D
R D RI: R
D CT: R
R D
R DE: D
D D R D
R D MD: D
State Legislature
D H/S: Republican
R D D H/S: Democrat
H/S: Split
R EERS Pending
D/R Governor’s Party
R
HI: R
January 2011

15. Contact Info
Kevin Cullather
Senior Policy Manager
Midwest Energy Efficiency Alliance
20 North Wacker Drive, Suite 1301
Chicago, IL 60606
312-784-7265
kcullather@mwalliance.org
www.mwalliance.org