Building Retrofits Emphasized In California's Energy Efficiency 2.0

April 15, 2015- California Governor Jerry Brown's aggressive efficient energy (EE) policy calls for doubling the EE savings in existing buildings by 2030.

To achieve such an ambitious goal, breakthrough innovations in EE policies, technologies, and financing will be required.

"In other words, its time upgrade from EE 1.0 to EE 2.0, with a very heavy emphasis on building retrofits," says Christine Hertzog, founder and Managing Director of SGL Partners and the Smart Grid Library,

In the strategy to reduce per capita energy consumption, EE 1.0 put the focus on efforts such as replacing old light bulbs with energy-stingy LEDs, installing double or triple pane windows, and upgrading air conditioners and refrigerators to take advantage of Energy Star ratings and utility rebate programs.

In a recent online post at TheEnergyCollective.com, Hertzog writes about the Next Generation of Energy Efficiency Project at Stanford University. The project, led by Dian Grueneich, former Commissioner of the California Public Utilities Commission and now a Senior Research Scholar at the Precourt Energy Efficiency Center and the Hoover Institution, aims to define EE 2.0 by creating a series of White Papers to help mobilize actions that deliver Governor Brown’s objective to "double down" on EE savings.

In her post, "Energy Efficiency 2.0: A New Definition Underway in California," Hertzog looks at the first White Paper, said to contain some of the steps Ms. Grueneich has identified to define an EE 2.0 framework:

1. Articulate EE’s new role in terms of its increased value to economic, energy, and environmental security

2. Structure transparency and build awareness through annual performance reporting on EE gains

3. Revise state agency roles and processes to streamline policy and projects support

4. Align EE regulatory rules and policies with state climate goals

5. Improve customer-funded programs

6. Investigate the state’s development and enforcement of codes and standards that can accelerate EE goals

7. Identify and support innovations in technologies, policies, and financial products that contribute to EE savings

Hertzog believes that while relatively low-tech innovations such as insulation and double pane windows may help retrofit existing buildings to higher EE savings, it's the exciting work in labs that will improve building envelope materials in the form of new paints as well as "smart" windows.

Even as both have upfront acquisition costs with a promise of energy bill reductions enjoyed in the future, comparing EE investment in insulation upgrades to an investment in solar panels highlights the importance of policy, agency governance, and finance.

Hertzog notes that homeowners have a range of options that include use of PACE programs to finance solar investments or partnering with firms that handle the upfront acquisition and installation costs and share in the production and tax benefits, whereas insulation upgrades lack the same diversity of financial programs and partnership options. She quotes Grueneich, commenting in a recent session, "in energy efficiency thousands of different decisions made every day by individuals, organizations, and governments. We have to use our policies and the private market to set up similar models to solar that make efficiency easy and attractive, for both consumers and providers alike."

Grueneich also noted that EE 1.0 consists of "mostly single 'widgets' and low uptake by consumers and businesses." Hertzog believes there’s pent-up demand and new technologies that EE 1.0 doesn’t address and asks, "How many more decisions about energy efficiency could be made if only policies and financial instruments better supported them?" Her take is that the Next Generation of Energy Efficiency Project just may provide that answer.

Read Christine Hertzog's full post on TheEnergyCollective.com here.

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