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Sacramento Utility Moves to Measure Energy Efficiency by Avoided Carbon Emissions

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  • Oct 12, 2020


The publicly-owned utility in the California capital of Sacramento is shifting the focus of its energy efficiency programs by adopting a metric that emphasizes the carbon dioxide emissions the programs avoid, rather than the electricity consumption they eliminate.

The Sacramento Municipal Utility District (SMUD) “is the first utility in the country to count avoided carbon emissions from the existing building stock as part of its progress on energy efficiency,” Greentech Media reports. “This makes building electrification central to SMUD’s energy efficiency efforts.”

The new approach to measurement “could be an effective way to incentivize utilities with decarbonization targets to adopt building electrification, provided that those utilities are also greening their power supply,” write Wood Mackenzie authors Fei Wang and Francesco Menonna, in a summary of their “grid edge” case study on SMUD. “Unlike energy efficiency programs that measure success in kilowatt-hours avoided, by folding building electrification into its energy efficiency efforts, the utility is advancing energy efficiency while increasing electricity sales.”

The utility district had already made building electrification a “core component” of its carbon neutrality plan, with a target that calls for 80% of area buildings to be all-electric by 2040, up from 17% today, Greentech states. “To prove the value of building electrification for climate change mitigation, SMUD developed a tool to calculate the savings in terms of avoided CO2 emissions from switching to electricity over the lifetime of an appliance, taking the evolving carbon intensity of the grid into account. Avoided carbon is a function of how clean the grid is for a specific location and of electricity’s time of use.”

Before developing the new metric, SMUD had already introduced a raft of energy efficiency measures, including incentives for electric retrofits and all-electric new construction, and a “massive effort to expand penetration of electric space and water heat pumps, induction cooktops, and charging stations for electric vehicles in its service territory,” the U.S.-based industry newsletter adds. In the latest Integrated Resource Plan (IRP) it filed with the California Energy Commission in 2018, SMUD estimates that more than 85% of homes and 75% of commercial buildings will have to convert their space and water heating from gas to electricity.

The WoodMac case study points to heat pumps as a “key technology” to get that transition done, Wang and Menonna say, “since home heating is a major source of emissions from natural gas. Heat pumps also bring the added benefit of increasing the efficiency of cooling, in addition to decarbonizing heating.”

Greentech has details of the issues SMUD is running into in its drive for carbon neutrality by 2040.

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