On August 3rd, EPA released the final Clean Power Plan (CPP), a rule that sets performance rates and individual state targets for carbon dioxide emissions from existing power plants. Although energy efficiency is no longer a CPP building block, it can still play a prominent role in Colorado’s compliance strategy for its state plan, which must be submitted to the EPA next September 2016. Energy efficiency is still featured as a key compliance option for states in materials recently released by the EPA (see Energy Efficiency TSD and Key Topics and Issues Fact Sheet) and Chapter 3 of EPA’s Regulatory Impact Analysis, which includes energy efficiency monitoring and reporting costs.
Some CPP changes from the proposed rule include
- 2030 targets are slightly stronger
- Targets are translated into both mass-based and rate-based scenarios
- Timeline for rule compliance pushed back to 2022
- States required to meet interim compliance goals in 2024, 2027, and 2029
- Energy efficiency improvements can count if installed after January 1, 2013 and will be still be saving energy in 2022 and will continue to receive credit for each year after.
A variety of energy efficiency measures, programs, and policies can count toward state compliance, including utility and nonutility energy efficiency programs such as low-income weatherization programs, building energy codes, combined heat and power, energy savings performance contracting, state appliance and equipment standards, behavioral and industrial programs, and energy efficiency in water and wastewater facilities. The EPA is forming a Clean Energy Incentive Program (CEIP) in order to attract early investments in energy efficiency in low-income communities. Under the optional program, energy efficiency programs in low income communities will get double credit for energy savings that occur in 2020 and 2021.
Over the next year, EEBC board members and staff will offer guidance to the Colorado Energy Office and Colorado Department of Public Health and Environment on the integration of energy efficiency into state compliance plans. EEBC is seeking input from members through our policy committee meetings on what programs and policies to include in the Colorado State Plan. Key among these recommendations will be expanding existing demand side management programs, which helps to maintain existing energy efficiency utility programs in the state.
Among the recommendations for incorporating energy efficiency into state plans are:
- Expand existing utility demand side management programs
- Upgrade building codes
- Create an energy efficiency carbon trading market
- ESCOs (Commercial Energy Service Performance Contracts)
- Improved appliance standards
- Residential and commercial financing programs
- Low-income weatherization programs
- Industrial energy efficiency
- Multi-family housing energy efficiency incentives
- Small business energy efficiency incentives.
For more information about the EPA’s proposal for Colorado, read Clean Power Plan State at a Glance – Colorado
About EEBC: The Energy Efficiency Business Coalition advocates for the energy efficiency industry in Colorado at the state and federal level to advance energy efficiency policies, programs, technologies, investments, and behaviors. For more information about EEBC and its member companies, visit http://www.eebco.org/.