This Utility Dive story looks at the discussion surrounding the value of investments in energy efficiency in the wake of one Southwest utility’s decision to reduce its EE program. AEE’s perspective is included, quoting Malcolm Woolf, Senior Vice President, Policy. Link to the full article here.

Excerpts of the Utility Dive story are below:    

There's a saying in energy efficiency: "The cheapest kilowatt is the one you don't use." But as renewable energy prices fall, will that remain true?

Put another way: "As renewables get cheaper, what is the long-term effect on efficiency? That's the million-dollar question," RMP's (RMP) Clay Monroe, who heads the utility's customer-facing programs, told Utility Dive.

The question is a bit theoretical, but it came into sharp relief last week when the Southwest Energy Efficiency Project (SWEEP) criticized RMP's decision to lower investment in efficiency programs in Utah.

The utility is cutting its 2019 energy efficiency target by about 20% compared to 2017 through its Wattsmart programs, SWEEP found, pointing to RMP's recent 2019 Forecast Savings.

RMP is budgeting for 299 million kWh of annual energy savings next year — compared with 373 million kWh actually saved in 2017…

"It [the value of energy efficiency] doesn't decline. In fact, it may increase, and it certainly changes," Malcolm Woolf, senior vice president at Advanced Energy Economy, told Utility Dive.

With a more diverse system, said Woolf, the equation has moved far beyond the price of efficiency measures versus generation costs. "The timing of the kilowatt-hour matters an awful lot," he said. "Saving a kilowatt-hour may be less important at the height of solar production, but later it may be more important than ever."

Perhaps the cheapest kilowatt-hour is the one used at the right time.

"Ramping and load shape has changed dramatically," said Woolf."The value of efficiency really depends on when that kilowatt-hour is saved. Where you've got surplus energy generation, there's less reason to save a kilowatt-hour. ... As the system is becoming more diverse, flexibility is critical. And energy efficiency and demand response allow you to have that."

See the complete UD story here.