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Maryland Power Plants and the Environment (CEIR-18)

5.1.2 EmPOWER Maryland

In July 2007, the Governor announced an energy initiative called EmPOWER Maryland with a goal of reducing Maryland’s per capita energy consumption and peak demand by 15 percent by 2015. This initiative was codified by the EmPOWER Maryland Energy Efficiency Act of 2008 (EPM Act). The EPM Act seeks to achieve electric consumption and peak demand reductions as follows:

Under the EPM Act, utilities with more than 200,000 customers are responsible for the full 15 percent demand reduction and two-thirds of the consumption goal (i.e., a 10 percent reduction in consumption), with the remaining 5 percentage point reduction in per capita electricity consumption to be achieved through State-administered programs and changes to efficiency codes and standards. The utilities required to participate in EmPOWER Maryland include BGE, DPL, PE, Pepco, and SMECO.

As written, the EPM Act is inclusive of both electric and gas companies; however, the PSC has not established goals for gas energy efficiency programs. In 2014, Washington Gas Light (WGL) submitted a voluntary gas reduction program for the 2015-2017 program cycle. On December 23, 2014, the PSC approved WGL’s residential and demand response programs which are designed to reduce gas consumption for heating and water heating in existing and new construction. As of early 2016, the PSC is in the process of considering the development of natural gas efficiency goals.

EmPOWER Maryland Energy Efficiency and Conservation Programs

The EPM Act directed EmPOWER Maryland utilities to develop plans for all customer sectors—residential, commercial, and industrial. The PSC is directed to consider whether each program is cost-effective and adequate to achieve the EmPOWER Maryland goals, and also to assess the program’s potential impacts on electricity rates, jobs, and the environment. The programs offered by the utilities include rebates for ENERGY STAR® products, energy audit and retrofit assistance, combined heat and power, and incentives for energy efficient new construction. In addition, all of the utilities have been directed by the PSC to include conservation programs targeting low-income consumers.

EmPOWER Maryland Peak Demand Reduction Programs

The EPM Act directed utilities to reduce per capita peak demand by 15 percent from 2007 levels by the end of 2015. While energy efficiency programs can result in demand reduction, the majority of demand reduction comes from demand response and dynamic pricing programs (see Section 2.1.4 for more information on demand response). The EmPOWER Maryland utilities, with the exception of PE, implemented these types of programs to meet these goals.

In regard to demand response programs, BGE has implemented its Peak Rewards program, which is a voluntary program that cycles air conditioners, heat pumps, and water heaters for residential customers. Pepco and DPL are operating an Energy Wise Rewards program and SMECO is running CoolSentry; each offers residential and small commercial direct load control programs for air conditioner cycling. Potomac Edison cites a lack of any cost-effective mechanism to meaningfully reduce peak demand. Each program offers various cycling levels, including 50 percent, 75 percent, and 100 percent. As the utilities have reached program saturation levels, the savings contributed by the demand response has plateaued. At the end of 2015, the four demand response programs were capable of providing a demand reduction of 738 MW.

The installation of advanced metering infrastructure (AMI) meters allows for utilities to implement a dynamic pricing program, which is used to lower summer peak demand (see Section 5.5.3 for more information on AMI meters). Dynamic pricing is a voluntary program for all customers with an AMI meter, regardless of whether they have central air conditioning. The day before an event, the utility will notify customers that the following day will be a dynamic pricing day. On the day of a dynamic pricing event, for each kWh that a customer reduces his or her usage from its baseline between the hours of 1:00 p.m. and 7:00 p.m., the customer will receive a bill credit of $1.25. BGE customers that participated in an event received, on average, a bill credit of $5 to $8 per event in 2015. In 2015, BGE, DPL, and Pepco customers reduced their loads by a total of 499 MW.

EmPOWER Maryland Reductions

At the conclusion of 2015, the utilities had achieved 99 percent of their energy reduction goal and 100 percent of their demand reduction goal. The majority of energy savings from 2009-2015 were achieved through residential and commercial lighting programs.

Table 5-3 Energy Efficiency and Demand Response Reported Achievements

  2015 Reported Reduction 2015 Goal Percentage of Goal
BGE
Electric Consumption (MWh) 2,638,975 3,593,750 73%
Demand Reduction (MW) 1155.949 1267 91%
Pepco
Electric Consumption (MWh) 1,600,813 1,239,108 129%
Demand Reduction (MW) 639.550 672 95%
PE
Electric Consumption (MWh) 529,519 415,228 128%
Demand Reduction (MW) 82.344 21.000 392%
DPL
Electric Consumption (MWh) 382,605 143,453 267%
Demand Reduction (MW) 146.701 18.000 815%
SMECO
Electric Consumption (MWh) 242,347 83870 289%
Demand Reduction (MW) 92.437 139 67%
Total
Electric Consumption (MWh) 5,394,259 5,475,409 99%
Demand Reduction (MW) 2116.981 2117.000 100%

Source: Individual utility EmPOWER Maryland annual reports filed January 31, 2016.

EmPOWER Maryland Goals Beyond 2015

On July 16, 2015, the PSC issued Order No. 87082 which established energy efficiency goals for the EmPOWER Maryland electric utilities beyond 2015. The PSC adopted an annual incremental gross energy savings reduction of 2 percent from a utility’s weather-normalized gross retail sales baseline, which will be officially implemented beginning in the 2018-2020 program cycle. The 2016 weather-normalized gross retail sales will serve as the baseline for the 2018-2020 program cycle. The PSC did not set demand reduction goals, but stated that utilities should continue to use the demand reduction targets established through the approved 2015-2017 plans for program years 2016 and 2017. Table 5-4 depicts the utilities’ demand reduction targets for 2016 and 2017. Currently, there are no established goals for natural gas or limited income programs.

In an effort to ramp up the utility plans to achieve the 2 percent goal in 2018, the PSC issued a 2017 goal. In 2017, utility plans that are not forecasted to achieve an energy savings equivalent to 2 percent of their respective weather-normalized 2013 gross retail sales must increase their 2017 forecasted energy savings 0.2 percent above the forecasted 2016 plan savings. For example, if a utility plan is forecasted to achieve a 1.3 percent reduction in 2016 from the 2013 weather-normalized retail sales baseline, then the goal for 2017 would be a 1.5 percent reduction from the 2013 baseline. However, if a utility is projecting 2 percent energy savings in 2017, it would use the 2017 plan as filed. The 2017 goals, formalized in PSC Order No. 87285, are depicted in Table 5-4.

Table 5-4 EmPOWER Maryland Energy Efficiency Goals and Demand Reduction Targets for 2016 and 2017

  Annual Energy Efficiency Goals
(MWh)
Annual Demand Reduction
Targets (MW)
2016 2017 2016 2017
BGE 565,933 631,138 811.97 834.495
DPL 66,931 76,060 110.828 115.292
Potomac Edison 73,434 88,557 10.8 11.6
Pepco 237,311 268,599 399.764 407.261
SMECO 75,900 78,284 63.528 64.258
Total 1,019,509 1,142,638 1,396.89 1,432.91

Source: MD PSC Commission Order No. 87285 and 2015-2017 EmPOWER Maryland Plans for each utility.

 

Maryland Public Utilities Article §7-211
Maryland Public Service Commission Docket No. 9362, Mail Log No. 158098
Maryland Public Service Commission Order No. 86785
Maryland Public Service Commission Order No. 87082
Individual utility EmPOWER Maryland annual reports filed January 31, 2016
BGE Smart Energy Rewards, Baltimore Gas and Electric, http://www.bge.com/smartenergy/smart-energy-rewards/Pages/default.aspx
BGE Smart Energy Rewards, Baltimore Gas and Electric, http://www.bge.com/smartenergy/smart-energy-rewards/Pages/default.aspx
Individual utility EmPOWER Maryland annual reports filed January 31, 2016