CWEB.26/Feb.26.1998
Special Update/March.11.1998 Bonneville Conservation/Renewables Budgets for 2002-2006 A regional panel examining Bonneville Power Administration costs has scaled back its recommended future budget cuts in BPA energy conservation and renewable energy initiatives. In its final report released March 9, the Bonneville Cost Review Management Committee recommends $9.3 million in annual BPA conservation and renewables budget cuts for fiscal years 2002 through 2006. The panel’s draft recommendations, which came out in mid-January, called for $22.4 million in spending reductions in those categories. The change reflects public concerns, according to a Northwest Power Planning Council news release. (See Con.WEB’s story on reactions to the committee’s initial recommendations.) The final recommendations include continued BPA funding for regional market transformation, consistent with the Regional Review; reductions in forecasted costs for current Bonneville conservation projects and no modifications or extensions, except for low-income weatherization; and funding for three planned renewable energy projects, along with renewables research and development, with annual project losses capped at $15 million and a ban on additional projects unless BPA costs are fully covered by project revenues. Con.WEB’s March issue will include a further report on the committee’s final recommendations for a total of $145 million in annual BPA cost reductions beginning in 2002. |
A S SIGNS OF SPRING begin to appear around the Northwest, so too do signs of vigor for clean, green energy.
First comes Bonneville Power Administration with a surprisingly respectable amount of reported energy savings in fiscal year 1997--55.2 average megawatts--despite huge reductions in conservation budgets.
Meanwhile, positive opinions on energy conservation were expressed in abundance at two hearings held by the BPA Cost Review Management Committee, and in a poll of Washingtonians conducted by Seattle City Light.
Renewable energy also garnered support at the cost review hearings, and tacitly in two developments in Portland General Electric's customer choice pilot program: an environmental labeling program for all energy service providers (including PGE), and a green-power package offered by one of the ESPs.
In addition, we take a glimpse at the Northwest consumer market for green power as viewed through utility pilot programs.
This month we also examine the huge efficiency potential in the booming Northwest microelectronics industry, along with Idaho Power's new membership in a national utility alliance offering retail products and services--potentially including home energy management.
Enjoy the emergence of spring--fitful as it is in the Northwest--and keep in touch if you wish, with marko@newsdata.com.
Bonneville Power Administration continues to record substantial energy savings from conservation initiatives, even with drastically reduced budgets.
At the same time, however, the near future looks considerably dimmer for BPA conservation.
BPA chalked up 55.2 average megawatts of conservation savings in fiscal year 1997, according to the agency’s just-released Conservation Resource Energy Data, also known as the Red Book (for the color of its cover). This figure lies within the general range of annual savings accumulated by Bonneville in its pedal-to-the-metal conservation years earlier this decade, which peaked in 1995 with 68.9 aMW.
The 1997 numbers came up reasonably big despite annual conservation spending levels that have dropped from $172 million in 1994 to $42 million in 1997--about a 75 percent reduction.
A main reason for this solid performance can be found not only in Portland, but all around the region. Slightly more than half the reported 1997 savings (28.1 aMW) came in the multisector category, predominantly through third-party financing arrangements and so-called "flex agreements" in which local utilities spend BPA conservation dollars over a longer time with greater flexibility.
"It’s a real credit to the folks who worked on all these programs, the folks implementing them at the utilities," said Gene Ferguson, who coordinates Bonneville’s legacy conservation contracts. "That really shows a lot of dedication, a lot of skill, a lot of ability to innovate, and it’s something we all ought to be real proud of. Too many people are walking around with their heads hanging down because the [conservation] programs are ramping down. They’ve got a lot to be proud of."
Indeed, though, the BPA conservation ramp is heading downward at a steep angle. The Red Book forecasts 12 aMW of BPA energy savings in fiscal year 1998, and only 7 aMW for the entire period from FY 1999 through 2003. For that same six-year period, energy-efficient building codes in areas served by publicly owned BPA utility customers are anticipated to produce another 75 aMW of savings, assuming medium load growth.
Over the past 16 years, BPA conservation endeavors as well as more stringent energy codes in public-power territory have led to total energy savings of 689 aMW, the Red Book reports. BPA spent about $1.7 billion on energy conservation from 1982 through 1997. The federal power marketing agency, however, cautions against dividing dollars spent by energy savings to arrive at a per-unit cost of conservation. The Red Book calls this exercise "inappropriate" because of the varying lifetimes of different conservation measures and the indirect relationships between some of the savings and cost figures.
A Look Back at 1997
As mentioned above, the top BPA conservation producer for the year that ended Sept. 30 was the multisector category.
Most prominent within this category were third-party financing arrangements, for which BPA reaped 22.1 aMW of savings. Included here are initiatives by the Conservation and Renewable Energy System (CARES), Oregon Municipal Energy and Conservation Agency (OMECA) and Tacoma City Light. Meanwhile, flex agreements with utilities saved an additional 5.6 aMW. These two account for virtually all the multisector savings in FY 1997. On the cost side last year, BPA spent $16.3 million in the multisector category.
By loosening its controls over conservation programs such as these, Bonneville "unleashed a whole lot of creativity out there," said Ferguson. "Utilities often find areas to bring in some of their own money and maximize some savings by doing something in a way not allowed under our old contracts. That’s probably the key." One example he cited is the increasingly widespread use of loan programs for conservation measures.
In many cases, he noted, utilities have targets or other incentives to spend their BPA conservation dollars for maximum advantage. "All of these things helped to increase the efficiency of the programs and therefore the cost-effectiveness and return on investments," he said. Indeed, since 1994, BPA’s annual conservation spending has dropped about 75 percent, while annual energy savings have declined less than 10 percent (with the notable exception of the peak year of 1995).
Although the multisector savings are not broken down by customer types, Ferguson noted they encompass residential, commercial, industrial and agricultural conservation initiatives.
Meanwhile, Bonneville-overseen programs in the different sectors reported very modest savings in FY 1997. Industrial efficiencies amounted to 6.7 aMW, while commercial conservation was 4.8 aMW. Residential programs recorded only .3 aMW in 1997, while the agricultural sector had no reported energy savings.
Energy-efficient building codes, however, provided BPA with 15.3 aMW of savings in 1997--the single highest annual total in the 1982-1997 period. This includes both residential and commercial energy codes throughout the Northwest. Bonneville takes credit for the code savings in its public-power customers’ service areas because BPA programs such as Super Good Cents helped establish energy-efficient practices that led to more stringent codes, BPA vice president for energy efficiency Terry Esvelt explained last year. "That was our philosophy, it worked, and now we’re reaping the benefits," he said.
Bonneville’s 1997 energy savings and costs reported in the Red Book do not include market development activities, nor BPA’s participation in the Northwest Energy Efficiency Alliance.
Historical Perspective
With its 1997 numbers, Bonneville now reports total conservation savings of 689.5 aMW from 1982 through 1997 (see accompanying chart for the year-by-year breakdown).
The biggest single source of conservation over these years has been the residential sector, with 177.7 aMW (but only 14.1 aMW after 1993). Next comes improved building codes at 114.6 aMW, followed by commercial at 111.9 aMW (including 33.5 aMW after 1993). These are trailed in order by the Conservation/Modernization program for regional aluminum smelters (95.9 aMW), other industrial initiatives (90.1 aMW), multisector programs (78.1 aMW) and the agricultural sector (21.2 aMW).
On the expense side, Bonneville has spent roughly $1.7 billion on conservation since 1982. The residential sector accounts for the majority of the spending: $994 million. Commercial is next, at $322 million, followed by multisector ($122 million), industrial ($103 million), miscellaneous ($84 million, virtually all prior to 1994), Con/Mod ($45 million) and agricultural ($28 million). The cost figures include direct and indirect expenses, as well as conservation’s share of BPA corporate overhead, but they do not include interest expense on conservation borrowing.
For more information on the Red Book, call Lee Jones at (206) 216-4208 or Sharon Doggett at (503) 230-5478.--Mark Ohrenschall
Bonneville Power Administration's future role in energy conservation and renewable energy initiatives has emerged as a major issue in the debate over proposed BPA cost reductions suggested by a regional panel.
The Bonneville Cost Review Management Committee--comprised of representatives from the Northwest Power Planning Council, BPA and the private sector--released draft recommendations in January for $159 million worth of annual cuts in BPA's budget beginning in fiscal year 2002. The 11-member committee wants to strengthen BPA's competitive position in the wholesale power marketplace, and specifically to help keep BPA-marketed federal power within the region by making it attractive for Northwest utilities after most current BPA power-sales contracts expire in 2001. The draft recommendations have been characterized by the committee as returning BPA to its historical roots of marketing and transmitting Columbia River hydropower.
Among the committee's eight draft recommendations are spending cuts in power system cost management ($48 million in annual savings), BPA overhead ($42 million), transmission ($32.5 million), debt service reductions ($20 million), Washington Nuclear Plant-2 ($19 million), BPA's marketing department ($14.7 million) and the Northwest Power Planning Council ($1.7 million).
In addition, the panel suggests an end to Bonneville funding of regional market transformation (saving $14.6 million annually), no extension or modification of existing conservation contracts, and abandonment of any renewable energy work beyond two current wind-energy ventures and a planned geothermal plant. The conservation and renewables proposals are forecast to save $22.4 million annually after FY 2001.
The committee's final recommendations are scheduled to be released March 16.
Although they represent a relatively small percentage of the proposed budget cuts, the conservation and renewables elements generated substantial opinions at public meetings Feb. 9 in Portland and Feb. 11 in Spokane. [Editor's note: This reporter listened to the meetings via phone.]
Some 15 speakers--primarily representing public-interest, low-income, environmental and energy conservation and renewables groups--took issue with the committee on recommended cuts in conservation and renewables. Slashing such programs would violate BPA's public purpose, as well as the 1980 Pacific Northwest Electric Power Planning and Conservation Act and the 1996 Regional Review, according to many comments. These cuts also would be unfairly selective, and in any case would be premature until Northwest states create public-purposes funding mechanisms. Specifically, the draft recommendations also would jeopardize regional low-income weatherization initiatives, several people said. Renewables, meanwhile, were touted by a number of speakers for their green-power potential in a competitive electric marketplace.
Cost-Cutting Supporters
At the same time at least nine speakers at the two meetings supported the committee's draft recommendations, either implicitly or explicitly endorsing the conservation and renewables cuts. This bloc consisted of representatives from utilities (publicly owned and investor-owned), an aluminum company and industrial customers. Although their perspectives were not uniform, they generally liked the notion of BPA reducing its costs as the committee suggested.
One such advocate was Bob Crump, general manager of Kootenai Electric Cooperative in northern Idaho, who said his utility "supports and endorses each and every one of the recommendations" proposed by the committee.
"If the region desires to keep the benefits of the federal Columbia River Power System in the Northwest in 2001," Crump said, "then the price [of BPA power] needs to come down and the cost needs to come down. It's that simple. A majority of our cooperative members are not going to be willing to pay a premium for Bonneville power."
The $159 million of cost reductions "should help ensure the subscription process [for BPA power after 2001] will indeed be successful. If the price is right, customers will be there," said Mike Henry, general manager of Lincoln Electric Cooperative in northwest Montana.
The fault line of the public-purposes debate was described by manager Richard Heitman of Inland Power & Light in eastern Washington. He said he admired the committee for its attempts to "balance the needs and comments of those of us who represent folks who pay the bills and the other folks who represent some of the social interests Bonneville has historically taken care of . . . You've done a great job with your recommendations."
Mike Baker of Modern Electric Water Co. in Spokane agreed, saying, "Everybody is going to have to make some sacrifices to keep or make Bonneville competitive."
Investor-owned utilities are familiar with trimming costs, said Scott Brattebo of PacifiCorp, which recently announced plans to cut 7 percent of its work force. "If BPA can survive, it must return to its core role as the sole marketer of the federal power system" in the Northwest. "The special benefits provided to one or more special interests must be dramatically scaled back in line with current and future market realities."
Hobart Jenkins, a Kootenai Electric board member who said he was speaking as a "lowly, silent consumer," believes Bonneville "cannot be Daddy Warbucks for everybody's social scheme." He also questioned popular support for conservation and renewables, as reflected in the lack of substantial public-purposes funding from governmental entities. "Could it be that the people who run our cities and states don't feel the constituents they represent support all these things at the levels proposed?"
A similar point came from Ken Canon of Industrial Customers of Northwest Utilities, which he said is "very supportive" of the committee's draft recommendations. Bonneville shouldn't develop any new resources--including conservation or renewables--"unless a customer on a bilateral basis specifically requests [BPA] to do so and pays all the cost.
"We are not saying those [public-purpose] activities shouldn't occur," Canon continued, but "they should not necessarily be a Bonneville function as a wholesale power provider post-2001." The concept behind the Regional Review's recommended 3 percent charge for conservation and renewables was to make public purposes a customer responsibility, he said. With the proposed BPA cuts not taking effect until 2002, state legislatures have several years to implement public-purposes funding. "Failing to do that raises the question as to what types of public-policy support actually exists for those kinds of activities," according to Canon.
Noel Shelton, representing three aluminum companies, said, "We do not argue with the merits of public purposes, but we believe both the decision to invest and the responsibility to fund need to rest on the same level, and that's the local level. We agree that function shouldn't rest with Bonneville."
In Defense of BPA Conservation, Renewables
But Bonneville, said the other side, is not just a power marketer focused on its bottom line. It is a federal agency with historic responsibilities for such public services as energy conservation and renewable energy development.
"Bonneville conservation programs are a legacy in a sense of an accomplishment," said Chuck Eberdt of the Washington State Association of Community Action Agencies. "No small part of the pride . . . people have in Bonneville and public power is due to the fact those institutions would do things for them, for the public, that other power businesses wouldn't do in the past. To lose sight of the fact that that is the root of public power, the reason Bonneville exists . . . to me is remarkably myopic. It is the [public] purpose that is important, not necessarily the manifestation of how you effect that purpose. Cheap power is one way, but it is not the only way."
Absent its public purposes Bonneville may as well be privatized, suggested Jeff Shields, general manager of Emerald PUD and chair of the Northwest Energy Coalition, who quickly added he doesn't support such a dramatic step. "Bonneville was created to bring something to the Pacific Northwest in an area and a time when the private sector was not fulfilling those needs . . . Bonneville still needs to be there and provide services beyond what the private sector is obligated to serve. If that's all we're trying to accomplish, who can get to the bottom of the barrel quickest, the best way is to turn it over to the private sector . . . Bonneville needs to offer values to customers beyond the cheapest electrons."
Committee member Mike Kreidler, a Power Council member from Washington, offered a similar thought at another point in the hearings: "If [Bonneville is] going to be as lean and mean as a private enterprise, it probably should be private." He also described the committee's work as "an effort to take a look at what was necessary for survival in a very challenging marketplace," but added, "We may lose our soul in the process of trying to break down those costs."
Advocates for continued Bonneville conservation and renewables funding pressed their case on other grounds.
Regional Act, Regional Review
One is the law. Many speakers brought up the 1980 Pacific Northwest Electric Power Planning and Conservation Act, passed by Congress and signed by President Jimmy Carter. Among other provisions, the act directs the Bonneville administrator to acquire conservation consistent with regional plans developed by the Council, and establishes cost-effective conservation and renewables as the top priority resources.
This, according to Sara Patton of the Northwest Energy Coalition (formerly Northwest Conservation Act Coalition), is a basis of "the leadership Bonneville is required to expend on behalf of energy conservation and renewables."
Although times have changed, "The goals of the regional act are every bit as important as the day it was written," said K.C. Golden of the Washington Department of Community, Trade and Economic Development.
Another oft-mentioned citation was the 1996 Regional Review, which, although not legally binding, produced a set of recommendations that included earmarking 3 percent of revenues from the sale of electricity services in the region (equivalent to $210 million in 1995) for "cost-effective conservation, renewable resource development and low-income weatherization" for at least 10 years. Most of the monies would be earmarked for local initiatives, but the Review also recommended that between one-sixth and one-third of the funds collected be dedicated regionally for market transformation, renewables research and demonstration, and development of some renewable resources. "Funding for these activities should be collected in part through Bonneville wholesale rates to the extent regional firm loads are served by power from Bonneville," the Review recommended.
The cost-cutting panel's report represents "a frontal attack on the integrity of the Comprehensive Review," charged Ralph Cavanagh of the Natural Resources Defense Council. He said he had been talking with federal officials in Washington, D.C., about electric industry restructuring, and representing the Review as the Northwest's consensus position. "It's working; they're buying it. They're not trying to reinvent the Northwest from Ohio, Virginia or Texas right now. I'm here today to find out whether I'm telling the truth."
Cavanagh challenged the cost-review committee to not reopen the painstakingly crafted Review. "For better or worse, the public impression is [the Review is] in play. You have the power to remove that impression or leave it in place."
Policy Choices
Angus Duncan, a former Power Council member from Oregon, believes the cost-cutting panel strayed too far into policy decisions in its draft recommendations. "The implication is that all the recommendations are value-neutral and policy-neutral, but clearly they're not," he said; the suggestions for the Council, WNP-2 and conservation/renewables all represent policy choices.
"Once you went across the line, into policy territory, the report became very selective, not inclusive," Duncan continued. "If conservation and WNP-2 are up on the table, so should a whole litany of other [BPA] costs that are policy choices" that may be good policy or just subsidies. "In most cases these are also costs that Bonneville wholesale competitors don't bear." He recommended an "inventory of [Bonneville] public purposes and their associated costs" followed by a "separate, equally careful, less hurried public debate" on their future.
Although Duncan didn't specifically mention these other costs, other speakers cited what they believe are Bonneville subsidies for irrigation, river navigation and aluminum companies served directly by BPA. "Why were not the other sacred cows served by Bonneville questioned?" asked Steve Weiss of NWEC. "This panel's biases aren't difficult to spot."
Jason Eisdorfer of the Oregon Citizens Utility Board agreed with Duncan's assessment, and added, "These are policy questions which are not appropriately addressed behind closed doors." This refers to the fact many committee meetings were closed to the public.
Market Transformation
Of specific concern to many people was the fate of regional market transformation, which is now conducted under the auspices of the Northwest Energy Efficiency Alliance. Slightly more than half the Alliance's current funding comes from Bonneville.
Cavanagh called the Alliance "the model of how to do regionwide, high-efficiency, low-cost market transformation."
Alliance executive director Margaret Gardner said her organization believes that "public benefits do remain a key role for Bonneville during this transition period to a more competitive electric industry. Helping the Northwest become more energy-efficient is one of the most important services Bonneville can deliver during this time."
And while the Alliance agrees with the committee that alternative funding should be sought for regional market transformation, it will take quite some time for Northwest states to implement public-purposes funding--perhaps past 2001. "The momentum we have built now . . . could be lost simply because of the timing" of BPA funding disappearing, Gardner said.
She and others suggested BPA continue funding market transformation at least until public-purposes money is in place.
Low-Income Weatherization
A number of speakers criticized the panel's recommendations because they would apparently prevent Bonneville from extending contracts--with no additional funding--for low-income weatherization programs around the region.
In July 1996, explained Don Andre of the Spokane Neighborhood Action Program, Bonneville reached agreement with Northwest states for low-income weatherization "intended to bridge through restructuring to the other side . . . [but] the bridge hasn't reached the other side yet and the river continues to widen." Andre said--and others concurred--that BPA officials have signaled a willingness to extend the time under which these contracts can be completed. "Reneging on this responsibility at this time is the wrong action," said Andre. "It's the wrong place and the wrong time . . . The contracts have been planned around and expected by weatherization service providers."
Eliminating this extension would have a noticeable real-world impact on real people, according to several speakers. "Thousands of homes will continue to waste energy, waste money and drive some of our neighbors, some of our most needy neighbors, to the point of financial disaster," said Jay Formick of Oregon Heat.
Renewables
The proposal for eliminating further BPA renewable resource development and research "completely wipes out a tiny but productive budget for renewables," said Rachel Shimshak of Renewable Northwest Project.
"Renewable resources provide value and opportunity," she continued, as the "only clean replacement for hydro." They also "respond to growing consumer demand in the region" for green power.
Gutting BPA renewables would lead to three serious problems, according to Alan Larsen of SeaWest Energy, developer of the Wyoming Wind Energy Project for which Bonneville has committed to a power purchase.
First, he said, it would "undermine Bonneville's credibility as a business partner." It would also violate BPA's "statutory obligation" to pursue renewables, which in turn would lead to litigation that would "end up wasting Bonneville money."
And third, Larsen said, the green power market represents "perhaps the only product line in the evolving [electric] industry that has some sort of markup available," because many customers are willing to pay more for renewable energy. Preventing Bonneville from developing new renewables would be "counter productive to the goal of helping Bonneville be competitive," he said.--Mark Ohrenschall
Attachments:
Energy conservation programs are an important service for utilities to provide, according to a recent poll of Washington state residents.
The poll of 798 randomly selected Washingtonians also found high customer satisfaction with electric utilities, and a decided lack of awareness--and ambivalence--about electric industry restructuring.
The poll was commissioned by Seattle City Light and conducted by Evans/McDonough of Seattle. It surveyed 400 residents statewide (about 12 percent of those were Seattleites, reflecting the city's proportion of the state's population) and another 398 in City Light's service territory. The telephone interviews took place Nov. 21 through Nov. 24. Margin of error is plus or minus 4.9 percent.
Seattle City Light undertook the poll as well as focus groups, workshops and a town meeting as a "two-way communication effort" with customers, according to a City Light news release. "We want to help our customers make informed decisions about the future of their city-owned utility," said superintendent Gary Zarker. "As competition comes to the electric utility industry, customer opinions will help us provide services customers want, while preserving the benefits of low rates and environmentally friendly power we have here."
Service, Conservation Findings
In one of the sections survey respondents were asked to rate on a scale of one to five--one being "not at all important" and five being "very important"--the importance of various utility services, according to City Light spokeswoman Sharon Bennett.
Reliable electric service received the top rating, with a mean response of 4.89 in the statewide survey and 4.75 in the City Light territory poll. Then came prompt repair (4.74 statewide, 4.69 Seattle), low-cost electricity (4.62 statewide, 4.47 Seattle) and good customer service (4.61 statewide, 4.49 Seattle).
Environmentally responsible power generation that protects salmon habitat garnered a mean response of 4.22 statewide and 4.24 in Seattle.
Conservation programs were found to be just slightly less important than environmentally responsible power generation, with a mean response of 4.18 statewide and 4.22 in Seattle. Bennett said conservation was described to poll respondents as "programs to encourage people to use electricity differently."
Assistance to people who cannot afford monthly electric bills had a mean response of 4.04 statewide, 4.17 in Seattle, while power generation through its own hydro dams received a mean score of 3.8 statewide, 3.7 in Seattle.
These findings show popular support for energy conservation initiatives, Bennett said. "It certainly appears from this poll that conservation is a fairly strong element . . . supported by both our ratepayers and those all across the state."
City Light also detected conservation approval in other public forums, she noted. At a recent televised meeting with about 50 people present, "The studio audience found conservation to be very important to them. They don't want to see it disappear; they are fearful it would be jeopardized under deregulation." Focus groups with City Light customers also discovered "highly favorable" opinions of the municipal utility's energy management programs. "Our commitment to conservation is very strong," Bennett said.
Indeed, City Light ranked as the leading energy-saver among publicly owned utilities in the region from 1978 through 1994, according to figures from the Northwest Power Planing Council. And in 1998, the utility reports that it plans to spend 4.2 percent of its revenues on conservation along with 1.3 percent on low-income rate assistance, for a total public-purposes budget equaling about 5.6 percent of utility revenues. (For more information on City Light's initiatives, visit the utility's conservation Web site.)
Current Utility Satisfaction, Restructuring Opinions
The City Light poll also found very positive customer attitudes about electric utilities.
In the statewide sampling, 87 percent of respondents rated the overall performance of their utilities as excellent or good. The Seattle rating was virtually identical--86 percent. In addition, 53 percent of the statewide respondents and 62 percent of City Light customers said they would not switch from their current utilities even if they had a choice--primarily because of high customer satisfaction.
Lofty excellent/good ratings were recorded for overall service (90 percent statewide, 91 percent Seattle), service (83 percent statewide, 85 percent Seattle) and reliability (83 percent statewide, 87 percent Seattle). However, rates were judged as excellent/good by only 63 percent of statewide respondents, and 66 percent of Seattleites.
Meanwhile, nearly three-fourths of the respondents statewide and in Seattle (72 percent for both) reported they were unaware of changes under consideration in the electric utility industry.
Given what they know, however, there is great ambivalence about restructuring. A total of 44 percent of respondents statewide favor "deregulating electricity providers," while 38 percent are opposed and 17 percent don't know. In Seattle, the figures are 36 percent in favor, 46 percent opposed and 18 percent don't know.
Competition and choice are seen as the top reasons to support deregulation, according to the poll, while a perception that change is unnecessary, along with worries about increased rates and bad experiences with other deregulated industries, are considered major reasons for opposition.
In further questioning at the end of the survey, opposition to deregulation increases.
"While there is strong support for the concept of competition, particularly in its theoretical ability to reduce costs and increase service, there is substantial skepticism among the public that electricity costs will decrease under deregulation," the poll states.
Bennett said City Light has received many inquiries about the poll--both the process and results-- from utilities, regulatory agencies and others around the country.--Mark Ohrenschall
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As Pacific Northwest utilities gear up for anticipated electric industry restructuring, several have launched pilot programs for customer choice of electric providers. A brief look at the different ways in which green power is being offered to consumers via these programs and a survey of subsequent customer response provides a glimpse into the future of the regional renewables market.
Initial indications suggest that Northwest utilities and power marketers are dedicated to offering green power options to customers--residential and small commercial customers, at least. The industry is experimenting with various ways of offering these choices, from different approaches within a portfolio model to direct access for energy services providers.
The extent to which the various approaches succeed will most likely hinge upon competitive pricing, marketing techniques and perhaps even the idiosyncrasies of customers within each utility's service territory. These pilots are anticipated to provide much needed information to lawmakers, as states like Washington and Oregon contemplate the details of restructuring, and as these programs progress, they will confer a bit more clarity on the nature of Pacific Northwest consumer demand for green power
Washington Water Power
Washington Water Power’s More Options for Power II (MOPS II) is among the pilot programs recently earning regulatory approval.
The Spokane-based utility is widely credited with developing the "portfolio model" of customer choice, offering residential and small commercial consumers with a gradual transition into the direct access energy market of the future. Although potential comprehensive restructuring legislation that would have incorporated the portfolio model was recently shelved in Olympia (see Con.WEB, Jan. 28, 1998) the portfolio model remains at the core of MOPS II.
Approved by the Washington Utilities and Transportation Commission in December and the Idaho Public Utilities Commission in February, the two-year pilot is scheduled to begin May 1, 1998, when approximately 7,800 customers in Deer Park, WA, and Hayden and Hayden Lake, Idaho, will be able to select from a menu of energy alternatives that includes a renewable resource option. All of WWP's customers in these regions, except for its 30 largest industrials, are eligible to participate.
WWP reports it is finalizing an agreement to purchase green power from a wind-energy purveyor, and that it will also use wood-waste biomass energy from its 52-megawatt Kettle Falls generating station to satisfy demand for renewables.
Customers will be able to purchase units of green electricity at a cost of $1 per block, with a single block of wind energy translating into 50 kilowatt-hours, and a unit of biomass equivalent to 73 KWh. WWP senior rate analyst Bruce Folsom said the utility chose this design based on the success of Public Service Company of Colorado's "buck per block" program. All told, the cost of green power will run about 2 cents more per kilowatt-hour than the price of energy under other options on WWP's slate.
The program has not yet gone into effect and it is difficult to predict whether customers in the pilot regions will be willing to pay extra. But Folsom said WWP wants to offer green power for several reasons: "Experience on the West Coast, 
focus groups, surveys, and general customer comments lead us to want to experiment with responsiveness in our service territory. The purpose of offering renewables in our pilot is partly to determine customer response and acceptance, as well as to improve marketing over time."
Clark Public Utilities
A cross-section of 6,200 electricity consumers in southwestern Washington’s Clark County will also be able to exercise choice over the source of their power, beginning with March meter readings.
Clark Public Utilities' one-year portfolio pilot, known as Powerful Choices, was approved by its commissioners on Jan. 20. The plan stipulates that selected residential and small commercial customers can opt between four different energy alternatives--all of which will still actually be supplied by Clark. One of these options is green power, currently geothermal in source. Wind power from Wyoming is set to come on-line later this year and will be added to the mix. Clark is purchasing these renewables from PacifiCorp.
At 3.9 cents/KWh, the cost of green energy exceeds that of Clark's standard issue by 1.5 cents/KWh. Customers can mix and match power sources, as long as each selection constitutes a minimum of 25 percent of their total load. Commenting on the popularity of Clark's green alternative, spokesman Mick Schutt said it's "not humongous" even though "there was a lot of interest in it as we went through the process."
Pilot participants were asked to choose by Feb. 20 with the understanding that no reply means current service will continue unaltered. As of Feb. 23, Clark had received 844 out of 6,200 possible responses. Of these, 561 elected to stick with the status quo. A meager 15 respondents opted for green power exclusively. Another 188 Clark County customers chose some combination of the four options. Shutt estimated that approximately half of these included requests for at least 25 percent renewable energy. "Like anything else, people are interested until they find out how much it costs," he said. Schutt noted that green power is offered at a cost more than 50 percent higher than the price of Clark's standard product. "That's probably where people went off and bought 25 percent green," he observed.
PacifiCorp
PacifiCorp likewise will be using the portfolio approach in the residential and small commercial customer segment of its planned Klamath County, OR customer choice pilot program. Oregon Public Utility Commission approval of the plan is pending.
PacifiCorp spokeswoman Jan Mitchell said at least one green power option will be included among portfolio choices. She added that one of the issues to be addressed in the OPUC settlement scheduled for March 16 is whether customers should be given a single choice for each type of power supply, or whether they should be given as many options for things like green power as PacifiCorp can present. "The inclination is to give the customer as many choices as possible," she said, noting this would provide the 1999 Oregon Legislature with lots of information, and give more incentive for power marketers to participate.
Although the utility is cautious about "confusing customers . . . with too many offerings," Mitchell said PacifiCorp's aim is "presenting options in a meaningful way," and that the company hopes to "approach customers with what they value"--green power among them. Mitchell could not comment on specifics of the market for renewables in Klamath County, nor provide details of green offerings under the pilot, as the earliest the company will receive bids is April 7. Customer education strategies, she added, are now being designed.
As part of its proposed direct access program for large customers--those with demand greater than 5 MW--and schools within Pacific Power's Oregon service territory, the utility will also be offering a renewables incentive credit of .2 cents/KWh for customers opting to buy green power directly from an energy services provider.
Portland General Electric
Portland General Electric's Introductory Consumer Choice Plan differs from others in the region in that it provides direct access to all participants--residential, commercial and industrial alike. Under the pilot approved by the OPUC on Oct. 21, industrial and large commercial customers were immediately eligible to switch suppliers, while residential and small commercial consumers in Hillsboro, St. Helens, Sandy and Oregon City were able to begin the transition Dec. 1. To date, 13 energy services providers have been certified by the OPUC, with three expressing interest in pursuing residential and small commercial consumers.
Electric Lite, a South Carolina-based power marketing company, is the first to offer renewables to customers in the PGE pilot. Consumers selecting Electric Lite "Green" are guaranteed at least 50 percent electricity from "renewable-end, low impact" sources, said the company's general manager Jan Burreson (see related story below for more details).
Electric Lite Green's tag line is: "A penny for the planet." And indeed, the price of renewable power offered under the program is 2.82 cents/KWh, while the company's standard rate is 1.82 cents/KWh. Burreson said it is too early to make projections as to what percentage of customers will choose Green, but response since the company started running television commercials the week of Feb. 16 has been overwhelming. "Every time an ad runs, the phones ring off the hook," she noted.
Burreson said Electric Lite always intended to bring a green product to market under the PGE pilot, but the company "started hearing that customers wanted it now, so we pushed up our time line." She said she couldn't speak to demand for green energy in other markets, but in the Northwest "folks truly do care what's in their power."
Burreson noted that since Electric Lite began promoting its green option, it has received calls with questions ranging from "Where is the geothermal product coming from?" to "What is green power, anyway?" There seems to be demand "across all levels of customer sophistication," she observed.
PGE spokeswoman Karen Lee agreed that Electric Lite Green seems to be a hot option; its marketing has "caught the eye of the mainstream media" within the utility's service territory, and more articles are appearing about green power. She added that PGE surveys conducted in connection with the pilot program indicate "green power and 'environmentally friendly' sources are high on the list of what customers pay attention to, and they say they will be willing to pay more for it."
Enron Marketing Services and Edison Source--the other ESPs expressing interest in pursuing residential and small commercial customers--are not currently offering green options in PGE's pilot. Both are making green offerings in California's soon-to-be-open retail electric marketplace, but neither could be reached for comment on whether they will bring similar renewables to Oregon.
As part of customer education efforts associated with PGE's pilot, a task force comprised of representatives from the utility, OPUC, the Oregon Office of Energy and conservation groups approved a new environmental consumer label last September.
The label, which participating ESPs must send to customers at the time they subscribe and quarterly thereafter, contains details regarding the generation sources of the electricity they've chosen and general information about emissions and their impact upon the environment (see related story below for more details).
Lee said ESP's have been providing environmental impact information in their efforts to woo pilot customers since the label was approved, before the program officially began.
Earlier, said Electric Lite’s Burreson, "It was like no one cared. Why do you care if you only have one choice [of power]? As people have more choice, I'm totally convinced folks in the Northwest will pay attention to labeling, even though it's in very fine print." Lee agreed; the label is an additional tool for consumers. "It becomes more relevant and customers learn how to use it as the market heats up. Until you need to use that tool, [environmental energy labeling] is not something you talk about around the dinner table or in cocktail party conversation," she added.
And in January, PGE agreed to send out its own label to all of its 685,000 customers. The utility hopes to include a labeling proviso in its broader Customer Choice Plan, designed to extend direct access to all of its customers and currently undergoing OPUC review. Although it is too early to tell what type of renewables options would be offered in this program, PGE included in its implementation plan a 3 percent system benefits charge. Applied to all customers, proceeds from the SBC would "finance public purpose efforts formerly accomplished by utilities," according to a plan document. More specifically, the charge would cover development of renewables, energy conservation, and low-income weatherization. PGE would oversee the portion of the funds allocated to development of 19.5 aMW of geothermal resources. The OPUC's final order on PGE's Customer Choice Plan is scheduled for Oct. 7.
Commercial, Industrial Offerings
Most efforts to market green power under pilot programs have been dedicated to courting residential and small commercial customers. Incentives for industrials and large commercial customers to purchase green power are more likely to come in the form of credits, as in the large customer and school segments of Pacific Power's pilot.
But not all. In April 1997, PGE announced that, with OPUC approval, it had initiated a unique experimental program, Earth Smart Power, in an effort to gauge green power demand among large commercial and industrial customers and to encourage development of renewables. Customers with 1 MW of capacity at a single site could commit to purchasing either 3 percent of their total annual load in green power, or a monthly minimum of 20,000 KWh. PGE in turn would purchase and deliver the power within a five-year window of time (by 2001) at a premium of approximately 1 cent per KWh above standard cost.
The utility announced it had contracted to purchase energy from a 25 MW wind-energy facility, and that it aimed to supply 5 MW to consumers in the program. The city of Portland signed up for a prototype of the innovative program, agreeing to take 5 percent of its annual load in green power. PGE officials said the utility is still filling the Portland contract, but no customers have been added in PGE's service territory.
An added note: Earth Smart Power now refers to Enron’s renewable power offering to residential and small commercial customers in California. PGE officials said the program was not discontinued because of lack of interest, but rather is on something of a hiatus. Green power packaging was delegated to Enron headquarters in Houston after the merger of the two companies. PGE officials believe Enron intends to bring renewable products to Northwest markets, but they couldn't comment on whether the original Earth Smart Power program would be continued. Enron officials could not be reached for comment.--Angela Becker-Dippmann
Customers eligible for Portland General Electric's customer choice pilot program now have more information to consider in selecting an energy service provider: the source of the ESP's electricity, its emissions and environmental impacts.
PGE announced Jan. 30 that all ESPs participating in its pilot program--13 are now certified--are sending the energy labels to customers as they sign up and on a quarterly basis thereafter. In addition, the investor-owned utility said it, too, will send an energy label each quarter to all of its 685,000 customers.
The pilot program is open to 50,000 customers in the Oregon communities of Hillsboro, Oregon City, Sandy and St. Helens.
The new labels--reportedly the first used in the Northwest--include three items: a pie chart that breaks out the ESP's estimated sources of power supply (coal, hydropower, natural gas or oil, nuclear and other) and compares its mix to the regional average; a bar graph showing estimated air emissions of sulfur dioxide, nitrogen oxides and carbon dioxide, and spent nuclear fuel--both regionally and for the ESP; and a paragraph of information on the environmental impacts of each of the emissions, as well as a sentence on the impacts of hydropower.
PGE acted primarily as coordinator and facilitator for developing the label, said spokeswoman Karen Lee. "We chose to adopt the product of the group," which included the Oregon Office of Energy, the Oregon Department of Environmental Quality, the Oregon Public Utility Commission, the Northwest Power Planning Council, Northwest Environmental Advocates and others.
"This [information] may be one of the factors that customers want to include in their decision" on an energy service provider, said Charlie Grist of the Oregon Office of Energy. Customer surveys and focus groups indicate environmental impacts are "fairly high on the list of criteria" customers want to consider in selecting an ESP. And if the cost of electricity stabilizes with competition, he added, non-price-related factors such as environmental impacts may distinguish one ESP's product from another.
It makes sense, Grist said, to develop such labels for use in customer choice pilots. "We're testing to see if customers like it," and so far, the response is positive.
That doesn't necessarily mean the labeling developed for the PGE pilot will be used elsewhere. "It makes sense to do something different because these are pilots," Grist said. Another approach is to look at the source of the energy rather than the impact; for example, there are major variations in the amount of emissions produced by different coal plants, he noted. In addition, the approach used in the PGE environmental label doesn't provide much information on the impacts of hydropower.
Whatever the form, both Grist and Lee expect some sort of labeling will be incorporated into most customer choice pilot programs. "Environmental groups are pushing hard for this," according to Grist.
Lee said PGE also supports the idea and will push for its inclusion in other pilots. "You can vote with your dollars to support [a resource] that maybe wouldn't have gotten support from the market."--Jude Noland
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Electric Lite is offering residential and commercial customers in Portland General Electric's customer choice pilot program a power purchase option featuring resources with a less-negative impact on the environment.
Customers who choose Electric Lite "Green" will be buying from a resource mix that's at least 50 percent renewable (wind, solar, geothermal and landfill gas), 35 percent "clean" resources (hydropower and natural gas) and 15 percent coal and nuclear--although Electric Lite general manager Jan Burreson said less than 1 percent of the portfolio comes from nuclear sources. That compares to the Northwest average of 54 percent hydro, 32 percent coal, 8 percent natural gas and 6 percent nuclear and other resources.
"We knew this was something we wanted to do," said Burreson. Electric Lite--one of 13 certified energy service providers in the customer choice pilot--heard "loud and clear" from customers about the desire for a power option that emphasized renewable resources. "This is a good starting point," she said. "The average household or business can afford to switch to green."
Burreson said the price of "Green" is 1 cent per kilowatt-hour more than Electric Lite's standard savings plan, or 2.82 cents/KWh, compared to 1.82 cents/KWh. She said that amounts to about $7 per month more for the average family. This package is available to residential and commercial customers in Hillsboro, Oregon City, Sandy and St. Helens--a total of about 50,000 Oregon customers. "It's very hard to do [this] for such small numbers," she added.
Electric Lite is purchasing power for its green option from Illinova, which is working with Foresight, a California company that specializes in green power products. Burreson said identification of the resources is proprietary, but the power is coming from existing resources in the Pacific Northwest and California. "We'll be delivering this now and tapping into new resources as we come along." Electric Lite has contracted to place at least 1 megawatt of "Green" power on the system, she said, adding, "If everyone wanted to do 'Green' we could do it."
It's too soon to tell what percentage of the marketplace will want to switch to this green option, Burreson said, since Electric Lite just began promoting it this month. She noted, however, that Electric Lite's phones rang frequently after the first television advertisement aired, and that some of those calls came from Washington state residents as well as Oregonians eligible for the pilot.
Spokeswoman Karen Lee said PGE had hoped at least one of the energy service providers participating in the pilot program would offer a renewable resource option like Electric Lite's green product. "We think that's good," she said.--Jude Noland
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The Pacific Northwest microelectronics industry churns out small products in a very big way.
It is among the region's largest employers, according to a recent report from the Northwest Power Planning Council, Bonneville Power Administration and the Oregon Office of Energy titled "Opportunities for Efficiency in the Northwest Microelectronics Industry."
It has generated substantial economic growth, particularly in Oregon's Willamette Valley. And it is likely to grow much bigger; some analysts predict as much as $20 billion in additional investments in Northwest microelectronics facilities between 1995 and 2004. Already, according to the Council/BPA/OOE report, the Northwest produces about half of all silicon crystals and wafers made in the United States.
This bigness also extends to the industry's consumption of water and energy. One plant in Eugene, for example, may eventually slurp up as much as 10 percent of the city's municipal water supply. As for energy, the region's microelectronics industry consumes about 200 average megawatts, and if it grows as projected over the coming decade it may need an additional 400 or 500 aMW, according to "Opportunities for Efficiency."
Big, big, big--and so is the potential for energy efficiency.
Although daunting obstacles exist, energy savings on the order of 50 percent are deemed achievable in this huge, rapidly expanding, highly competitive and resource-intensive industry. Along with energy savings come productivity gains, reduced capital and operating costs, and better environmental stewardship--all of which matter to the people who make the products that help power the computer age.
"Opportunities for Efficiency" was prepared by Chris Robertson and Mark Cherniack of Chris Robertson and Associates, Jay Stein of E-Cube, Karl Vischer of BPA, Jeff Harris and Carlotta Collette of the Council, and Mark Kendall of OOE. It explores the industry, its energy use, barriers to and opportunities for efficiency, and strategies to reach the untapped potential for more efficient use of electricity within the industry.
A separate report by Robertson, Stein, Harris and Cherniack--with additional support from New England Electric System and the Conservation Law Foundation of New England--takes a similar approach.
"Significant opportunities to improve energy efficiency in the semiconductor industry have been reported to us; perhaps 50 percent or greater aggregate improvement appears possible," write Robertson, Stein, Harris and Cherniack in "Strategies to Improve Energy Efficiency in Semiconductor Manufacturing." However, they continue, "Equally significant market barriers constrain the industry from reaching these savings.
"Yet, because of this industry's concentration, competitiveness, and existing research consortia such as SEMATECH, we believe the substantial market barriers to energy efficiency can be addressed with carefully formulated strategies to demonstrate, document and communicate the business and technical case for advanced energy efficiency, including potential benefits in finance, manufacturing and corporate environmental performance."
Who Are These Guys?
The microelectronics industry is described in "Opportunities for Efficiency" as a "chain of several major production steps. The Northwest is fortunate to have most of these steps well represented by companies operating in the region."
In the beginning, "Elemental silicon feedstock is refined into a material known as 'polysilicon,' which is then melted in a furnace where a single crystal silicon ingot is produced. The ingot is then sliced into thin wafers that are polished and treated before being sold to chip producers," according to the report. Wacker Siltronic and Mitsubishi Silicon America are among the firms with Northwest facilities producing silicon crystal and wafers.
"In the next step in the process," the report continues, "chip manufacturers take the polished wafers, create integrated circuits on the wafer surface, then slice the wafer into individual chips. These chips are tested, assembled and packaged for sale to circuit board manufacturers and electronic original 
equipment manufacturers . . . The Northwest is home to a number of the world's largest producers of microcomputer chips, memory chips and application-specific integrated circuits . . . Intel, Micron and LSI Logic all have significant portions of their global production located in the Northwest.
"The original equipment manufacturers and circuit board manufacturers then sell into the market for finished consumer goods. Other prime buyers include defense and aerospace companies," according to the report. "The Northwest has a number of key domestic and foreign manufacturers of electronic equipment, including Hewlett-Packard and Tektronix."
In addition, a "closely related industry that uses some of the same manufacturing technology is the photovoltaic ('PV') power systems industry," the report notes. Siemens Solar Industries is the largest PV manufacturer--and is involved in a venture with the Northwest Energy Efficiency Alliance.
Rapid Growth
The semiconductor element of the microelectronics industry is characterized by rapid growth, which, according to the "Strategies" report by Robertson et al, "is based on continually increasing microchip complexity and speed, while reducing cost per function. 'Better, Faster, Cheaper' is the industry's paradigm." As features on chips grow smaller and smaller, the manufacturing process requires increasingly cleaner environments, "to minimize airborne particles which can contaminate the chip surface and cause it to fail . . . As feature sizes shrink and cleanliness standards tighten, the fabrication facilities (fabs) in which chips are manufactured have become more expensive. Their energy loads are also expected to increase, due in part to the larger volumes of air which must be filtered."
The fiery-hot furnaces in which silicon ingots are produced also use substantial amounts of energy--a factory with 100 furnaces, each with a capacity of 250 kilowatts, would have a furnace annual electric load of 16.5 megawatts, according to Robertson et al.
Electricity represents the largest operating expense for the microelectronics industry, according to "Opportunities for Energy Efficiency," which helps explain why so many firms have located in this region. " . . . the Pacific Northwest's abundant clean water, low-cost electricity, skilled labor force, and targeted tax-abatement programs have combined to push the region's microelectronics industry toward unprecedented growth," the report said.
Barriers
Even with its energy intensity, the microelectronics industry has not yet fully embraced the efficient use of electricity.
"In the past," write Robertson et al in "Strategies," "energy efficiency has not been a high priority area for management concern since energy costs were typically about one or two percent of total production costs, including capitalized land, buildings and equipment. This, combined with the industry's schedule-driven, risk averse and fragmented facility design process has led to plants and production tools which present significant energy efficiency opportunities."
Robertson and his colleagues describe the "extreme time pressures" for new microelectronic products, and the consequent difficulties in setting up a "whole systems design integration" approach that could greatly improve efficiency. Many companies replicate designs proven to be reliable and profitable, to minimize risk. Obsolete design standards and a general lack of awareness of efficient design are other barriers identified in the report.
"This is a highly competitive industry with very bright people who haven't really been thinking about energy," Harris told the Northwest Energy Efficiency Alliance board in December. At the same time, he noted, "This one is probably our most transformable market. This market moves so fast, nobody can afford to miss a good idea if it could shave points off operating margins."
Opportunities
A number of initiatives suggest that the microelectronics industry is beginning to take heed of energy efficiency. SEMATECH, the industry research consortium, is undertaking an international facility energy audit and benchmarking program. Several microelectronics firms have engaged in specific activities, ranging from joining the Climate Wise program to senior management reviews of energy efficiency to development of environmental management plans.
The industry is ripe for improved energy efficiency, according to a number of reasons outlined in the "Strategies" report.
One is economics. In new microelectronics factories, electricity is often the biggest single operating cost; monthly power bills of $1 million or $2 million are typical. "As competition in the industry tightens margins, these numbers are becoming obvious targets for management attention," the report said. "Equally important, the industry shares a common concern about raising the capital investment required for new plants to manufacture the next generations of technology. Trimming operating costs could provide several billion dollars to help fund next generation plants." Meanwhile, energy intensity is increasing as chips grow more complex and feature sizes shrink. And the industry is keenly interested in new methods of boosting productivity.
Externally, according to Robertson et al, the microelectronics sector is eyeing potential international climate-change policies that may affect energy consumption and price. And these companies yearn to be green. The report quoted an industry official: "We consider that environmental performance is a basic ingredient for product quality and company reputation; the business benefit is that managing for natural resource efficiency and clean processes is one of the greatest engines of productivity improvement."
An Alliance staff memo from September described the microelectronic's industry's "strong desire to be viewed as an environmentally conscious and proactive community." The memo went on to say: "The industry is at a critical juncture in [its] explosive growth world wide and there are tremendous opportunities to leverage change just at this moment. Thanks in part to the previous work sponsored by Bonneville, the Council, and Oregon Office of Energy as well as work by the Rocky Mountain Institute, SuperSymmetry, and others, the industry is now aware that energy is something that may affect [its] competitive situation in the future and [is] beginning to put some focus on it. [Industry officials] have been remarkably open to outside intervention because of this awareness."
The Alliance board in December decided to intervene, in the form of a new market transformation venture to identify and pursue efficiency opportunities in the Northwest microelectronics industry. Specifically, the Alliance is seeking an integrated design process in which to enhance energy efficiency for production tools and the facilities themselves at a semiconductor manufacturing plant. It also plans to participate in industry forums and assess potential efficiencies in the polysilicon manufacturing process.
This is in addition to the Alliance's separate venture with Siemens Solar Industries to encourage efficiencies for crystal-growing facilities for the photovoltaic industry. These electric-resistant furnaces produce silicon ingots that are turned into silicon wafers.
Crystal-Growing Furnaces, HVAC System Opportunities
The examination of crystal-growing furnaces is identified in both the Council/BPA/OOE and "Strategies" reports as especially promising, not only for the photovoltaic industry but also potentially for semiconductors, which use comparable furnaces. In fact, furnace efficiencies could cut energy consumption as much as 60 to 75 percent, and reduce the cycle time for crystal growth by up to 50 percent.
"Siemens executives believe these improvements would be applicable to the entire installed base of . . . furnaces used to manufacture ingots for the semiconductor industry," write Robertson et al. "If achieved, this would reduce industry capital requirements, reduce costs for both semiconductor and photovoltaic grade wafers, significantly reduce energy use required for industry growth, and increase the economic viability of photovoltaic power systems.
"In the economics of this case," they continue, "the value of such a huge increase in furnace productivity completely overwhelms the value of the energy savings. One can imagine a fairly rapid technology diffusion if this package of retrofits is proven. Wafer manufacturers will have to adopt this technology for productivity reasons to remain competitive."
Another big opportunity described in both reports lies in integrated HVAC design in new fabricating plants. This could lead to energy savings of 70 percent or more in total HVAC energy consumption (HVAC accounts for 30 percent of a typical plant's total electric demand), as well as capital cost reductions of as much as one-third.
"Benefits from this integrated design approach go well beyond reduced energy costs," states the BPA/Council/OOE report. "Energy-efficient design can also improve reliability, while reducing wear and tear on other components, such as filters, fans, pumps and motors. The improved reliability and reduced wear translate directly into less down time and lower operating costs. Perhaps most significant to the industry, the lower pressures and slower airflow resulting from this design approach can improve filtration efficiency, which in turn can result in improved yields due to reduced particle contamination."
Additional efficiencies are envisioned in production tools and such subsystems as vacuum, exhaust, ultrapure water, process cooling water, compressed air, specialty gas production, waste treatment and lighting. "In our research numerous interviews identified opportunities with very large energy savings associated with each area," Robertson and his colleagues found. "These reported opportunities ranged on the order of 50 to 80 percent energy savings. Some, for example light guides, have beneficial productivity effects that can have significantly greater value than associated energy savings."
Both reports suggest a number of strategies to work with the microelectronics industry on improved energy efficiency. These include the development of case studies, ongoing professional education, guidelines for energy-efficient design, assessment of future technologies and support for research and development projects, as well as intensive, multidisciplinary workshops--known as charrettes--to promote integrated (and more efficient) design, as the Alliance is pursuing in its microelectronics initiative.--Mark Ohrenschall
Next Month in Con.WEB: A Case Study in Northwest Microelectronics Efficiency
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Idaho Power is one of four utilities to sign up as equity partners in a new national alliance that will help its members develop retail products and services, potentially including home energy management.
The concept behind the new Allied Utility Network LLC, according to president and chief executive officer Dean Alford, is to join utilities to develop cost-effective ways to offer retail products to their customers that they wouldn't be able to provide individually. Members will retain local control of the products and services they offer, he said, but will market those products under a national brand.
For the residential sector--Allied Utility Network's initial focus--the brand will be "HomeVantage," and products should be available within the next three months. Among the potential offerings are carbon monoxide detectors, power-quality devices, whole-house surge suppression, home security systems and whole-house energy management.
As for services, Allied is offering marketing research, strategies, planning and materials development; product mix and sales potential; financial analysis; invoicing and remittance processing; negotiation of vendor agreements; and customer response center support.
"The marketplace is non-homogeneous," Alford said, "so it depends on the [members'] residential marketplace. Some will be more attractive products than others." The added value of HomeVantage, Alford said, is in connecting the product offerings to a reliable company--the customer's utility--that is a credible supplier.
HomeVantage will also provide leverage to participating utilities, according to Alford, to recruit and attract customers they don't currently serve. Customers who live near an Allied Utility Network member's service area but receive power from a different utility would still be able to purchase products from the member, he said. "It's a competitive marketplace; that's the reason for this."
Idaho Power views the new alliance, announced Feb. 17, as a way to improve its service to existing customers while protecting its independence. "Solidifying this link with our customers . . . improves our chances of succeeding as a business and remaining an individual company," said utility spokesman Jeff Beaman.
Idaho Power's involvement in the Allied Utility Network grew out of its alliance with Snohomish County PUD, Beaman added. Through that partnership, Idaho Power realized there was some "commonality in thinking" in what publicly owned utilities and smaller investor-owned utilities see themselves facing as the electric industry restructures. Many had concluded a national alliance would be a viable means of better serving their customers, he said. As the idea was shopped around, the alliance came together.
Initially, according to an Idaho Power news release, Allied Utility Network will provide Idaho Power and other member utilities with market research to help determine future products or services for customers.
"This is an important first step for Idaho Power," said Rich Riazzi, Idaho Power vice president of marketing and sales. "It leads us onto a path that soon will bring us to providing greater value to our customers. Part of that value is learning the kinds of products or services our customers want and expect from Idaho Power. The research abilities and product development capabilities of the Allied Utility Network will help us gain that information and deliver those products and services."
By joining the network, according to the news release, "Idaho Power also strengthens its position as an independent utility in a time when competitive forces are reshaping much of the electric industry through mergers or acquisitions."
Riazzi said the combined membership "gives us an economy of scale in marketing or purchasing products and services. Today the successful utilities are those that can capitalize upon their creativity and abilities to build geographically diverse alliances and relationships with other utilities. Together we can accomplish more than we can alone."
Other members are the Omaha Public Power District in Omaha, Nebraska; Colorado Springs Utilities, a municipal utility in Colorado; and Cobb Energy Management Corp., a co-op affiliate in Marietta, Georgia. Snohomish PUD considered joining, but its commissioners decided not to participate.
Allied is offering 10 to 12 equity positions, and Alford said a number of other utilities have expressed interest in joining. In addition to equity membership, utilities can join as network members. There are no dues or fees, Alford said, but members will pay for the services they purchase. The company has also purchased the retail assets of A&C Enercom, an Atlanta-based company formerly headed by Alford that provides products and services to utilities nationwide. Allied is headquartered in Atlanta.
Together, the member utilities serve more than one million customers. Allied's goal is to have a combined customer base of three to five million by the end of the year.--Jude Noland
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The Oregon Municipal Energy and Conservation Agency has saved more energy at a lower cost than projected when it began operations in September 1994.
OMECA's latest annual report shows total energy savings from September 1994 through September 1997 of 5.77 average megawatts, at a levelized cost (in 1993 dollars) of 1.47 cents per kilowatt-hour. The average wholesale cost of power for the six OMECA members--city of Ashland, Forest Grove Light & Power, McMinnville Water & Light, Milton-Freewater Light & Power, city of Monmouth and Springfield Utility Board--is 2.47 cents/KWh, OMECA noted.
The collaborative's original targets were 4.2 aMW in energy savings at a levelized cost of 2.4 cents/KWh. Most of the savings over the three years (59 percent) came in the commercial sector, with 26 percent in residential and 15 percent from industrial. Improved efficiencies in each of the three sectors cost an average of 1.47 cents/KWh.
"OMECA members exceeded their 3-year energy savings goals by 33 percent at a levelized cost 38 percent lower than projected," according to a summary from manager Cathy Higgins. "Members also greatly benefitted from the exchange of technical assistance and support, and from the collective planning of new activities and financing."
For a copy of the report and its details on OMECA energy-saving initiatives, call the agency in Portland at (503) 796-1850, or send an e-mail to omeca@teleport.com.
The energy services offerings in Illinova Energy Partners' proposal reportedly led Smurfit Newsprint Corp. to select the power marketer to serve the portion of its load eligible for alternate service under Portland General Electric's customer choice pilot program.
Oregon City, OR-based Smurfit has two paper mills in Oregon, in Newburg and Oregon City, with a total peak load of 160 megawatts. Since Dec. 15, Illinova has delivered about one-third of that power.
Smurfit had been buying power from PGE through two contracts under Schedule 99, the utility's special contracts schedule. Those contracts were revised last year and re-priced at rates equivalent to PGE's schedules 67 and 87, said attorney Grant Tanner, who represents Smurfit. The power priced at Schedule 67 rates is now being provided by Illinova, he said, at a price "right off the most relevant daily index"--the daily mid-Columbia quote.
Illinova also is providing Smurfit with project management for energy efficiency and demand-side management improvements, said Leesa Story Nayudu, Northwest regional marketing director for IIlinova Energy Partners. Illinova has completed a walk-through energy audit of the company's facilities, she said, but no specific projects have been initiated.
Smurfit has made some energy efficiency upgrades through PGE's energy conservation offerings, according to Smurfit's Ron Ingram. The company is now interested in efficiency improvements such as better instrumentation and more high-tech equipment. "We're also hoping to entertain ideas on creatively financing [changes in] our production facilities" so peak power demand could occur at different times, Ingram said. Illinova plans to work with Smurfit on such projects.--Jude Noland
Registration is open for upcoming Building Operator Certification training courses in the Washington communities of Olympia and Kent.
The BOC program is designed for non-management staff who operate and maintain commercial and public buildings. Participants attend seven courses in energy-efficient building systems maintenance, complete test and in-facility projects, and upon successful completion receive Building Operator Certification from the Northwest Energy Efficiency Council, which operates the BOC program sponsored by the Northwest Energy Efficiency Alliance.
BOC courses begin in Olympia on March 26, with registration closing March 5. Classes will be held once a month through Oct. 15. The Kent series begins April 14 and runs through Nov. 5; registration closes March 24. Fee for the certification series is $650 per participant. Other Washington BOC classes are under way in Spokane and Everett. Nearly 200 building operations and maintenance staff are enrolled to become certified through the BOC program, according to NEEC.
For registration information, call Cynthia Putnam of NEEC at (206) 292-3977, or Mary Smith of Puget Sound Energy at (206) 447-3149.
An upcoming international teleconference on efficient motor systems is seeking host sites as well as participants.
The U.S. Department of Energy's Motor Challenge Program is presenting "Efficient Motor Systems: Your Path to Profits" on May 19 from 9 a.m. to 11 a.m. Pacific Daylight Time. "This interactive, live, satellite teleconference will focus on strategies for assessing and improving motor-driven system performance, featuring real world case studies that highlight ways to increase a company's reliability, process control, productivity and profitability," according to a DOE news release. A question-and-answer session also is scheduled.
The teleconference is expected to reach a large number of industrial companies and the organizations that serve them. It will, according to DOE, show why efficient motor systems make good business sense.
To register as a host site and/or for more information on the teleconference, visit the Motor Challenge Web site at http://www.motor.doe.gov/teleconference98.htm. Further questions can be addressed to the Motor Challenge Information Clearinghouse at 1-800-862-2086.
Companies that manufacture or represent energy-efficient, water-conserving or renewable energy products and services are invited to exhibit at the "Energy '98: Breaking the Barriers" conference and exposition scheduled for Aug. 3-5 in Bellevue, WA.
Several hundred government and private-sector officials with an interest in these products and services are expected to attend the event. Of particular interest will be exhibits for commercial/residential appliances and equipment, construction products, and technologies for renewable, industrial/commercial, transportation and lighting sectors, as well as water-saving and office technologies.
The event is sponsored by the U.S. Department of Energy's Federal Energy Management Program, the U.S. General Services Administration and the U.S. Defense Logistics Agency, in conjunction with the Northwest Energy Efficiency Council, Bonneville Power Administration, Pacific Northwest National Laboratory and the states of Washington, Oregon and California.
For more information on exhibiting, call Faye Boyle or Judi Berman at 1-800-960-2242, or send an e-mail to feenw@tainc.com.
Please contact Denise Lee,
dlee@newsdata.com,
with questions or comments on this site.
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