More and more, utilities are expressing a growing desire to engage with commercial and industrial (C&I) customers that have not participated in efficiency programs and to capture additional energy savings from non-lighting measures. That’s because utilities are looking at the changing market that is impacting their programs and positioning themselves to adapt.
REDUCED LIGHTING SAVINGS DUE TO EISA
New codes and legislation have diminished the per unit energy savings for many lighting retrofits, which are the largest contributor to utility energy efficiency portfolios. The 2007 Energy Security and Independence Act (EISA) included new efficiency standards for lighting, thereby reducing the baseline that utilities use to calculate energy savings for many standard lighting retrofits. For example, if an existing lamp is a 60 watt incandescent, EISA mandates utilities claim savings for an efficient retrofit as if the bulb were only 43 watts. This reduces the amount of savings a utility can claim for that retrofit by about one-third, as shown below.
Some regions have mandated even lower baselines than EISA, and codes will continue to tighten. Newer efficient lighting technologies, such as LEDs, are not that much more efficient than fluorescent technologies.
LEDs REDUCING FUTURE LIGHTING RETROFITS
The long life and high efficiency of LEDs will likely reduce the future number of C&I lighting retrofits. As a result, programs won’t be able to sell customers up the efficiency chain with successive generations of lighting retrofits as they had with fluorescents. So, lighting programs will need to reach new customers who haven’t participated in lighting efficiency, and offer core customers alternative solutions to the standard lighting retrofit in order to achieve ever-increasing portfolio efficiency targets.
There is an additional impact of fewer lighting retrofits. Lighting retrofits have been used as a low-cost partner to package with higher ROI technologies. If lighting retrofits become less common, there may be a corresponding decrease in retrofits with the other technologies. Programs need to prime the market to find substitute technologies for lighting as a bridge to other technologies to accomplish deep savings.
These two trends help explain why utilities are seeking to incorporate non-lighting technologies in their portfolio and find new customers to participate in programs.
Ecova’s Utility C&I programs offer utilities solutions to address these challenges. Our cost-effective program designs include:
- Developing programs to take advantage of today’s LED market
- Reaching new customers
- Priming the market for alternative technologies
Look for more information about these solutions in my next blog post.