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EM&V guidance critical for CPP compliance

In August 2015 EPA finalized the Clean Power Plan (CPP), which calls for a 32% reduction in carbon emissions from fossil-fuel fired generators from 2005 levels by 2030. The rule allows states to leverage energy efficiency (EE) to achieve carbon reduction targets. As previously outlined, EE measures are low cost per kWh and don’t require infrastructure investment compared with other carbon reduction strategies, which makes them “low hanging fruit” relative to other compliance actions. The final CPP allows states to use various forms of demand-side EE in their compliance plans as broadly outlined in Figure 1.

Figure 1: Main Energy Efficiency Strategies for CPP Compliance

However, the use of energy efficiency or demand-side resources as a compliance mechanism can be more challenging to administer compared with supply-side resources. Detailed quantification, verification, and reporting of EE measures are required for demand-side programs, which encompass a broad range of approaches and measures. Many states already have requirements or guidelines on how EM&V is conducted within their jurisdictions. To improve consistency across the states, EPA issued draft guidelines, Evaluation Measurement and Verification (EM&V) Guidance for Demand-Side Energy Efficiency, available for public comment. This guidance will establish standards that states will use to estimate and verify energy savings from EE activities used in rate-based compliance plans.

The draft EM&V guidance is divided into three sections: an overview of the intent of the guidelines, EM&V guidance for twelve key topics, and supplemental guidance for some common types of demand-side EE programs, projects, and measures. Table 1 below provides a brief summary of the twelve topics. 

Table 1: Proposed CPP EM&V Guidance Key Topics

The final CPP represents a global level reduction by more than 630 million tonnes of CO2 emissions by one US policy alone. Low-cost energy efficiency through various types of demand-side EE approaches can contribute significantly to this goal while minimizing expensive infrastructure investments in new power supply. However, rigorous estimates of EE program impacts require detailed reporting and verification.

DNV GL has evaluated a wide spectrum of EM&V approaches at all levels of rigor nationwide, as well as developed EM&V protocols. We will address important aspects of CPP’s guidance for achieving compliance using EE measures at our upcoming Webinar How EPA’s EM&V Guidelines will play a role in Clean Power Plan Compliance November 11, 2015 and in future blogs.

DNV GL’s Jason Symonds, Suman Gautam, Samuel Harms, Julia Vetromile and Bert Taube have also contributed to this blog.

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