Category Archives: North Carolina

Nudging Behavior to Lower Energy Bills in North Carolina Office Buildings

Source: Advanced Telemetry

Source: Advanced Telemetry

Office building employees in Charlotte, North Carolina are taking small, voluntary actions to save energy. These steps are making a noticeable difference on utility bills and Duke Energy, the country's largest utility, can prove it.

Duke's Smart Energy Now program is the first commercially-available program of its kind in the country to use behavior change to reduce energy use in office buildings. The program helped participating customers save about six percent in energy over three years, exceeding the five percent goal and representing enough savings to power nearly 2,600 homes for a year.

Through the use of gentle reminders and friendly games, the program encourages uptown office workers to turn off computers and lights and find other easy ways to save energy. An innovative electronic kiosk in the lobby of each participating building shows real-time energy use, and participants can check their progress.

Smart Energy Now is part of Envision Charlotte, an initiative led by companies in the city center to improve energy efficiency and sustainability. The program is helping Envision Charlotte meet its goal of reducing energy use by 20 percent over five years. Read More »

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Demand for Clean Energy Choices Grows in North Carolina

OLYMPUS DIGITAL CAMERADuke Energy secured approval from the North Carolina Utilities Commission this week to offer more renewable energy to its most energy-intensive customers in the state, including data centers, manufacturers and college campuses.

Duke's "green source" program comes at the request of customers like Google, which opened a $600 million data center in Lenoir, NC, and asked Duke Energy to provide them with more renewable energy offerings.

This is great news for economic development, jobs and the environment in North Carolina.  Duke's green source program will increase renewable energy investment beyond the goal set by North Carolina’s Renewable Energy Portfolio Standard.

Under the green source program, Duke Energy will work with eligible customers to identify the amount, type and source of renewable energy they want.  Duke will then arrange long-term power purchase agreements with solar, wind or other renewable energy suppliers.  Participating companies pay any additional costs of purchasing renewable energy. Read More »

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A New Day For Energy Efficiency In North Carolina

The North Carolina Utilities Commission issued an important ruling this week that reaffirms the importance of energy efficiency as the fastest and cheapest way to reduce pollution from fossil fuels, protect the health of our families and promote our economy.

The ruling approved a new “shared savings" program that allows Duke Energy to make favorable returns on energy efficiency investments, but only if the company saves their customers money in the process.  The shared savings model is the most common financial tool in the United States to encourage electric utilities to make energy efficiency investments.

The new program will motivate the utility to implement energy efficiency measures as broadly and cost-effectively as possible.  Duke’s investments, in turn, can help ensure a robust market for providers of energy efficiency goods and services.

The shared savings model also provides an additional financial incentive for Duke to achieve the voluntary energy savings it agreed to when the company merged with Progress Energy in 2012.  The merger agreement included a minimum 1% per year energy savings starting in 2014 and 7% cumulative energy savings over five years (from 2014-2018).  If the company achieves certain energy efficiency targets, it will receive a financial incentive.

Notably, the ruling requires Duke Energy to convene a stakeholder discussion on the feasibility of commercial and industrial on-bill repayment and combined heat and power programs, which will enable the commercial sector to achieve high levels of energy efficiency performance.

The commission's decision replaces Duke's avoided cost energy efficiency program, known as “Save-a-Watt.”  That program, which expires at the end of 2013, was successful in motivating Duke to make investments in energy efficiency.  In fact, the company exceeded its energy savings targets.  The downside: Save-a-Watt was overly complex for energy regulators and stakeholders.  In contrast, the new shared savings program is simple, transparent and will continue to expand Duke Energy’s energy efficiency investments.

EDF is pleased to see that the ruling incorporates all of the major elements of an agreement that we helped secure in August with Duke Energy, the Commission Public Staff, North Carolina Sustainable Energy Association and environmental colleagues.  We look forward to watching Duke Energy achieve its full energy efficiency potential.

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Unique Partnership Creates New Energy Efficiency Loan Model For Rural Homeowners In North Carolina

Duke Energy is the largest utility in the United States, so of course it gets a lot of attention in its home state of North Carolina.  Yet millions of residents in rural parts of the state rely on electric cooperatives, not Duke Energy, to keep the lights on.  In fact, rural cooperatives serve all or part of the customers in 93 of 100 counties in North Carolina.

This is important because rural areas have just as much, if not more, need to increase energy efficiency.  Case in point: a seven-county area in eastern North Carolina served by Roanoke Electric Cooperative.  The cooperative has made great strides in promoting energy efficiency, yet there are still customers with utility bills that are higher than their mortgage payments some months.  Close to half of Roanoke Electric’s customers live in manufactured homes, which typically have less energy-saving insulation than standard homes.  And, in an economically-distressed region, few homeowners have extra money to pay for energy efficiency improvements, like caulking around windows or adding insulation.

Now, thanks to a new program offered by Roanoke Electric Cooperative, homeowners can secure low-cost loans from a private lender to make home improvements that will reduce energy use and save money.   The loan is paid back on the monthly utility bill, reducing paperwork for homeowners and making repayment easier.  In this program, the energy efficiency home loan is made by Generations Community Credit Union, a lending institution focused on assisting underserved rural communities in North Carolina.  Homeowners can borrow up to $4,000 for improvements, with interest rates as low as 3.5%.

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Duke Energy Agrees To New Model For Energy Efficiency

Environmental Defense Fund and the North Carolina Sustainable Energy Association recently joined the North Carolina Utilities Commission Public Staff and environmental colleagues in reaching an agreement with Duke Energy on its new incentive mechanism for energy efficiency investments.

The NC Utilities Commission is expected to issue a ruling on the agreement by the end of November 2013.  If approved, the agreement will motivate Duke to implement energy efficiency measures as broadly and cost-effectively as possible.  Duke’s efforts, in turn, can help ensure a robust market for providers of energy efficiency goods and services.

The agreement would replace Duke's avoided cost energy efficiency program, “Save-a-Watt,” with a business model known as “shared savings.”  Save-a-Watt, which expires at the end of 2013, was successful in motivating Duke to make investments in energy efficiency.  In fact, the company exceeded its energy savings targets, but the program was overly complex for energy regulators and stakeholders.

In contrast, the shared savings approach will split the anticipated dollar savings between Duke and its customers and set a single, flat rate of return.  By sharing the savings, the model properly balances the interests of the utility and customers, and it will motivate Duke to make energy efficiency investments that save customers money.  The shared savings model is the most commonly used energy efficiency utility incentive mechanism in the United States.

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Saving Energy One Crab At A Time

Imagine the embarrassment of leaving your office lights turned on and returning to find a giant fiddler crab sitting on your desk.  This fishy situation is happening in office buildings all across Charlotte, North Carolina –the crabs are plastic, and the fiddler variety is used for their notorious attraction to light.  It is all part of a fun, social experiment happening in uptown Charlotte office buildings to remind employees to shut of their lights when leaving the office and power down their computers when headed home.  If employees leave their lights on, coworkers will place crabs in the offending employee’s office to remind them to turn off their lights. In order to rid themselves of the burdensome crab, that employee must covertly “tag” another absent minded coworker by leaving a crab on their desk – all in the name of energy efficiency.  

And the amazing thing is that the playful reminder works!  After “Crab, You’re It!” was introduced in one of Mecklenburg County’s office buildings, 26% more lights were turned off when not in use, leading to significant energy savings.  

The “Crab, You’re It!” game – now adopted as part of the Envision Charlotte project – is just one of several innovative employee behavior change experiments that are leading to real energy reductions in office buildings in this entrepreneurial North Carolina city.  The creators of the game – the County of Mecklenburg staff – knew that most office employees are not motivated to save energy solely out of the goodness of their heart.  We are all busy and saving energy in the office is not always top of mind.  The key was to find a way for employees to actually get excited and have fun while saving energy.  And, let’s be honest.  Nobody wants to be crabbed.

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Envision Charlotte Meets Pecan Street

Last week, I, along with several other Envision Charlotte Board Members travelled to visit the Pecan Street smart grid project in Austin, Texas.   We hope this will be the start of a recurring “exchange program” between the two cities for sharing of information and best practices related to smart grid deployment.  There are significant differences between the two projects.  Pecan Street is focused on the residential sector; Envision Charlotte on commercial office buildings.  Envision Charlotte is deploying innovative behavior change, social networking and employee training to reduce energy use, while Pecan Street is heavily focused on technology solutions. 

But, there is also a lot in common.  Both organizations desire to reduce energy use and find alternatives to our outdated energy system.  Both believe that smart grids and energy efficiency can be cost effective and drive economic development.  Finally, both groups are rigorously measuring the impacts of their actions. 

What we saw in Austin was very cool.  We started by visiting a home in the Mueller neighborhood, a playground for testing the latest in home energy management and appliances.  In one house’s garage was a wireless energy monitor that connects to the home’s circuit breaker box and allows homeowners to view real time energy use from different appliances and lighting systems in the home.  Residents now know exactly how much it is costing them to make coffee each morning – or power up their flat screen TV. 

Also in the garage was a Chevy Volt, along with four charging stations from different manufacturers (according to Pecan Street staff, they all perform roughly the same).  Up on the roof was a series of solar panels, whose every watt is being recorded to learn important things about installation location, potential for offsetting peak generation, and storage solutions.  Although each of these technologies are impressive on their own, only when operating together do they represent the next generation of home energy management where consumers have complete knowledge and control over their energy choices.  It’s pretty empowering.

This innovative project didn’t happen accidentally.  It came about through lots of perspiration from their Executive Director and former Austin Council Member Brewster McCracken; design recommendations from hundreds of folks in the private sector, local community and NGOs (including EDF); prodigious fundraising; and hard work from staff, board members, and participating companies.  Some of my key takeaways from the trip are as follows:

Residential Technology Still a Wild West – Unlike the commercial building automation universe, where users have more experience integrating energy management and building systems to speak the same code and talk to one another, residential systems are still in their infancy and competing languages make it extremely difficult to get different pieces of hardware to talk to one another.  Pecan Street will often need to write new code or develop other workarounds to get vendor equipment to work as described.  This is one of the reasons why EDF has joined the OPEN network, to help ensure that smart grid investments in different states maximize interoperability.

The Incredible Power of Data – Pecan Street collects a data point from each home circuit every 15 seconds.  With dozens of circuits per home and hundreds of participating homes in the Mueller development, the Pecan Street project has rapidly approached billions of discrete pieces of data that can be captured, sorted and analyzed.  Although a challenge to work with data sets this large, once properly harnessed, they provide incredible insights to consumers, utilities, researchers and policymakers on energy use.  Pecan Street can see exactly what happens to the grid when someone opens their refrigerator or micro-waves dinner, and use that information to develop strategies for homeowners that will reduce energy use and improve reliability.   

Test Technology, Scale, Inform Policy – Pecan Street is unique in its approach in several ways, but one of the most significant is that it enables a technology to policy pathway.  Pecan Street’s test labs experiment with the latest in home energy management technologies, present those solutions to homeowners in the Mueller neighborhood for adoption and enable EDF to identify regulatory or policy mechanisms that can further accelerate smart grid investment.  As an example, last year EDF was able to help secure provisions in a Texas energy bill that enable demand response programs and payments for utility customers.  This technology to policy approach is something that Envision Charlotte will need to reach our ambitious 5-year, 20% energy reduction goal.

All in all, it was an incredible trip.  Over the coming years, as Envision Charlotte develops more programs and scales its impact, we hope to repay the warm hospitality of Pecan Street by hosting their team in Charlotte and sharing what we have learned.  We’ll promise good conversation, great BBQ and a continued devotion to collaboration.

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European Power From U.S. Forests: Two New Reports Offer Pathways To Sustainability

European utilities are using trees grown in the United States to make electricity. Well, not the whole tree. But lots of the tree is used to make the little wood pellets that are then shipped across the ocean, mostly to the Netherlands, United Kingdom, Denmark and Belgium. It is these wood pellets that are burned with coal or in stand alone biomass boilers to produce energy. This video explains the journey from forestlands to power plants.

Why is Europe able to make electricity from U.S. trees when domestic utilities are cancelling wood biomass projects? Answer: Europe has a strong renewable energy policy.

The EU Renewable Energy Directive passed in 2009 sets a target for EU member countries to collectively achieve 20% of energy from renewable sources by 2020. Many utilities are increasing the use of biomass as a low-cost means of producing renewable energy. But Europe doesn’t have enough forest or agricultural land to meet the increasing demand. To fill that gap, European utilities are importing wood pellets – a form of chipped and compressed wood – from North America and increasingly from the Southern United States. The growing demand for U.S. wood biomass is raising questions about the sustainability of the country’s forest resources.

Two reports from Environmental Defense Fund, in conjunction with colleagues at Pinchot Institute and University of Toronto, examine economic, environmental and public health impacts from the expanding wood pellet market. European Power from U.S. Forests documents how the EU policy is shaping the transatlantic trade in wood biomass. For the U.S. export market to benefit from the large potential capacity for pellet production, producers in the U.S. will need to meet or exceed EU sustainability standards. Some type of forest management or pellet supply chain is likely to be required.

Pathways to Sustainability evaluates the programs and practices that fall under the EU biomass requirements for wood pellets, concluding that few of the pathways completely meet the standards. EDF proposes a new approach to recognize the various ways landowners and biomass producers on both sides of the Atlantic can meet their environmental objectives.

Sustainability will remain a pivotal issue as EU member countries, the European Commission and various stakeholders seek to harmonize sustainability requirements. European bioenergy companies often view biomass sustainability as the largest unquantified risk in their supply chains. Developing sustainable pathways sooner, rather than later, will reduce economic risk and encourage market development for wood pellets in the U.S. and Europe.

A webinar will be held July 17, 2012 at 12 pm EST. Please join Will McDow (EDF), Brian Kittler (Pinchot Institute) and Jamie Joudrey (University of Toronto) for a discussion of E.U. policies, the growing demand for wood pellet exports and options to meet Europe's sustainability requirements.

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Electric Utilities – An Industry In Transition

The recent merger of Duke Energy and Progress Energy represents yet another turning point for the electric utility sector, with significant implications for public health and the environment.  Duke’s six-state footprint – Florida, Indiana, Kentucky, Ohio, North Carolina and South Carolina – offers it an opportunity to lead the way on clean energy deployment.  The question is: Will the new Duke Energy – now the largest utility in the country – harness its size and scale to accelerate investments in energy efficiency and renewable energy, or stay anchored to the past?  EDF’s partnerships with Wal-Mart, FedEx and McDonalds have shown that when large companies are motivated, they are a powerful force for change.  But change doesn’t come easily.  It requires vision, leadership and a constant willingness to innovate.

This is true not just for Duke Energy, but for electric utilities around the country.  Over the past two years, four of the five largest investor-owned utilities have experienced a merger or change in the CEO role – AEP, Duke, Exelon and Southern Co.  The steps taken by these companies and their leadership will have a profound impact on our antiquated electric utility grid, human health and the environment.  The most visionary utility companies will do three things exceedingly well: 

1.       Get out ahead of environmental regulation

In 2002, Duke Energy supported efforts to tackle power plant pollution in North Carolina by supporting the “Clean Smokestacks Act.”  Xcel Energy followed a similar model in Colorado and endorsed the “Clean Air Clean Jobs Act.”  These landmark laws significantly accelerated clean-up of the dirtiest power plants in those two states and made it possible for the utilities to recover the costs of their investments.  It also enabled Duke and Excel to take early steps to modernize their fleets and prepare for future federal clean air requirements.  As a result of early actions, both companies are well-positioned for EPA’s recent Clean Air Rules – unlike the utility giant AEP, which continues to delay critical human health protections.  The world’s most successful companies skate to where the puck is headed, not to where it is, and are more competitive as a result.

2.       Treat efficiency and smart grid investments as new revenue centers, not side projects

The fact is that most electric utilities still see energy efficiency investments as side projects separate from their core business – generating power.  Without state building codes or energy efficiency standards in place, utility investment in energy efficiency remains low.  The reason is simple.  Even in states with decoupled rate structures in place, building nuclear plants is more profitable than energy efficiency projects.  Large generating plants require a large investment with a guaranteed rate of return over a long project lifetime.  In comparison, energy efficiency projects are generally small, often have an uncertain return and a short project life.  EDF is working with leading energy companies and regulators to craft new incentive models that make efficiency investments attractive, but utility companies must be willing to fundamentally alter their business models.      

3.       See competition as opportunity

Even in highly regulated markets, new market entrants and competitors are beginning to change the face of utilities with strong monopoly power.  The costs of solar panels have dropped by over a third in the past few years, making solar energy cost competitive with retail electricity prices in many parts of the country.  Companies like SolarCity are even financing and then leasing solar systems to home owners, enabling cash-strapped customers to reduce their dependence on the grid.  Hundreds of companies now exist to help all kinds of customers reduce their energy bills and dependence on electric utilities.  (I should know – I just insulated my attic and crawl space – and am already benefitting from lower electric bills.) 

Utility companies that help bring energy efficiency and renewable energy to market can retain ownership of environmental attributes (like renewable energy credits) and earn new revenue streams.  Otherwise, those benefits are likely to go to third parties or customers.  Smart utilities recognize the threat that this small, yet growing base of companies provides to their business model, and aim to bring technologies and services to market faster than new competitors.  Rather than trying to delay the inevitable, savvy utility leaders make their companies part of the solution – and profit from doing so.  Companies like San Antonio’s CPS Energy are making this idea a reality through partnerships with a wide range of service providers.

The next generation of electric utilities and their leaders must run their businesses differently than their predecessors or risk being left behind.  Just like the once monopoly-oriented telecom industry, those companies that are willing to adapt and transition to this new energy paradigm will prosper and be well rewarded.

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Creating Energy Champions

This commentary was originally posted on Duke Energy's Shedding A Light Blog.

In late January, I had the great pleasure of joining a group of Charlotte, N.C. city employees at an "Energy Champions" training hosted by Duke Energy and Charlotte Center City Partners. The city workers were bursting with enthusiasm, inventing creative ideas on the spot about how to motivate people to reduce energy use in the workplace. Many involved "friendly" competitions, around things like turning off monitors and lights: I for one would not want to be the recipient of the “Dim Bulb Award.”

Participants were excited to help Charlotte shine as a leader in innovation and to be part of Envision Charlotte, an initiative to make their city the most sustainable urban core in the country. Environmental Defense Fund (EDF) is pleased to be part of this innovative public-private partnership, along with Duke Energy, Charlotte Center City Partners, Bank of America and others.

One goal of Envision Charlotte is to reduce energy use in more than 60 large commercial and government buildings in Uptown Charlotte by 20 percent within a five-year timeframe. Why target buildings? Because buildings account for more than 30 percent of total energy use, and 65 percent of electricity consumption. Reducing energy use in buildings, especially the large buildings participating in Envision Charlotte (more than 10,000 square feet each), can have a huge impact and presents an enormous opportunity to cut costs and greenhouse gas emissions.

One of the ways Envision Charlotte will accomplish this goal is through Duke’s Smart Energy Now program. Duke and its partners Cisco Systems and Verizon Wireless have already installed smart meters and information kiosks in participating buildings. These displays show in real-time how much energy is being used in the city’s center every day, and provide tips on how to reduce that use. Information is also available through a secure portal, accessible to building owners and managers, which shows how much energy each individual building is using. This information will help employees, building owners and facilities managers make smart decisions about how they use energy every day of the week.

As a smart grid expert, I’m particularly interested to see what role smart technologies will play in making these buildings more efficient, and in shifting demand away from times of peak electricity use, when energy is most expensive and most polluting, and (ideally) to times when renewable energy is available on the grid.

Duke and its partners will host more Energy Champions trainings over the next few months, targeted specifically to different segments of building users: executives, workers and facilities managers. There is already palpable excitement in the city with the Democratic National Convention coming in the fall, which will place Charlotte in national, and even international, spotlights. Only these spotlights will be energy efficient. And please turn them off when you’re done.

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