An assessment model for energy efficiency program planning in electric utilities: Case of Northwest U.S.

Significance Statement

Energy efficiency stands out with its potential to address a number of challenges that today’s electric utilities face, including increasing and changing electricity demand, shrinking operating capacity, and decreasing system reliability and flexibility. Being the least cost and least risky alternative, the share of energy efficiency programs in utilities’ energy portfolios has been on the rise since the 1980s, and their increasing importance is expected to continue in the future. Despite holding great promise, the ability to determine and invest in only the most promising program alternatives plays a key role in the successful use of energy efficiency as a utility-wide resource. This issue becomes even more significant considering the availability of a vast number of potential energy efficiency programs, the rapidly changing business environment, and the existence of multiple stakeholders.

This paper introduces a hierarchical decision modeling framework for energy efficiency program planning in electric utilities. The framework focuses on the assessment of emerging energy efficiency programs and proposes to bridge the gap between technology screening and cost/benefit evaluation practices. This approach is expected to identify emerging technology alternatives which have the highest potential to pass cost/benefit ratio testing procedures and contribute to the effectiveness of decision practices in energy efficiency program planning. The framework also incorporates rank order analysis and sensitivity analysis for testing the robustness of results from different stakeholder perspectives and future uncertainties in an attempt to enable more informed decision-making practices. An assessment framework was applied to the case of 13 high priority emerging energy efficiency program alternatives identified in the Pacific Northwest, U.S.A.

The results of this study reveal that energy savings potential (35.6%) is the most important program management consideration in selecting emerging energy efficiency programs. Market dissemination potential (25.7%) and program development and implementation potential (24.6%) are the second and third most important, whereas ancillary benefits potential (14.1%) is the least important program management consideration. The results imply that program value considerations (49.7%), comprised of energy savings potential and ancillary benefits potential; and program feasibility considerations (51.3%), comprised of program development and implementation potential and market dissemination potential, have almost equal impacts on assessment of emerging energy efficiency programs. Considering the overwhelming number of value-focused studies and the few feasibility-focused studies in the literature, this finding clearly shows that feasibility-focused studies are greatly understudied.

The hierarchical decision model developed in this paper is generalizable. Thus, other utilities or power systems can adopt the research steps employed in this study as guidelines and conduct similar assessment studies on emerging energy efficiency programs of their interest. 

assessment model for energy efficiency program planning in electric utilities (renewable energy global innovations)

An assessment model for energy efficiency program planning in electric utilities (renewable energy global innovations)

About the author

Dr. Ibrahim Iskin is a senior software engineer at Zuliliy corporation in Seattle Washington USA. His research focus is on data science specifically machine learning and big data. Prior to that he worked at XPO Logistics and Bonneville Power Administration. He has a BS in Industrial Engineering from Istanbul Technical University, MS in Engineering Management and PhD in Technology Management from Portland State University. 

About the author

Tugrul Daim is a Professor and PhD Program Director in the Department of Engineering and Technology Management at Portland State University. Prior to joining PSU, he had worked at Intel Corporation for over a decade in varying management roles. At Intel he managed product and technology development. He also has several professional certifications including New Product Development Professional and Project Management Professional.

Professor Daim has been consulting to several organizations in sectors ranging from energy to medical device manufacturing. He has been helping organizations including US Dept of Energy, Energy Trust of Oregon, Biotronik, Biopro, Elsevier and many others to develop technology roadmaps for their future investments. He is also a visiting professor with the Northern Institute of Technology at Technical University of Hamburg, Harburg where he teaches similar short courses.

He has been recently appointed as Extraordinary Professor at the Graduate School of Technology Management at University of Pretoria in South Africa. He is frequently invited to give lectures to many multinational companies including IBM, Xerox and HP as well as universities  around the world including his recent visits to Finland, Japan and Germany. He has published over 200 refereed papers in journals and conference proceedings. His papers appeared in Technological Forecasting and Social Change, Technovation, Technology Analysis and Strategic Management, Computers and Industrial Engineering, Journal of Medical Systems, Energy, Energy Policy and many others. He has coauthored four books of readings and several proceedings.

He is the Editor-in-Chief of International Journal of Innovation and Technology Management and North American Editor of Technological Forecasting and Social Change. He received his BS in Mechanical Engineering from Bogazici University in Turkey, MS in Mechanical Engineering from Lehigh University in Pennsylvania, MS in Engineering Management from Portland State University, and PhD in Systems Science: Engineering Management from Portland State University in Portland Oregon. 

 

Journal Reference

Ibrahim Iskin, Tugrul U. Daim. An assessment model for energy efficiency program planning in electric utilities: Case of Northwest U.S. Sustainable Energy Technologies and Assessments, Volume 15, 2016, Pages 42–59.

Portland State University, Department of Engineering and Technology Management, Portland, OR 97207, United States.

 

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