Looking at the year in review, 2018 has seen a significant shift in direction at the policy level. There is little question that meeting the state’s aggressive climate goals will be a monumental effort. Energy efficiency is a vital part of that strategy, and the policymakers are banking on the energy efficiency industry, realizing that energy efficiency is almost always the lowest cost option when it comes to a clean energy future.
Time-of-use Rates and Savings
What has been interesting this year is to see the focus shift from overall savings to when savings occur. It makes sense if you think about it. An energy efficiency measure that saves when the demand is high, typically between 4 pm to 8 pm, has more value than one that saves in the middle of the night when demand is low. In 2019, many utilities will be switching to time-of-use rates this means energy will be more expensive during the peak energy periods when demand is high. This is an example of placing value on when consumption occurs.
Focused Effort on Reducing Emissions
Another change has been a more focused effort to reduce emissions. Fossil fuels are a primary source of emissions. Whenever you burn something, there are combustion byproducts such as unburnt particles, soot, and other nasty things. There is no such thing as complete combustion, there are always unburnt combustion byproducts, it is a law of Physics. Burning fossil fuels like coal, oil, or natural gas, to provide electricity or heat is not a long-term sustainable solution. We have other options such as solar, wind, geothermal, hydro, etc. Our planet has a limited capacity to absorb and disperse these byproducts, and many feel we are rapidly approaching or have already exceeded that capacity.
There is no question we need to reduce emissions, and we need to do it fast. Emission reduction has come center stage in California’s environmental strategy, and that is a good thing.
In summary, we have witnessed two critical trends in the past year. The first is a focus on when savings occur vs. overall savings. The other is the goal of reducing emissions. Together these two new goals are re-shaping the energy efficiency and policy-making landscape in California.