New Report Identifies Best Program Strategies for Realizing Energy Efficiency in Industry

New Report Identifies Best Program Strategies for Realizing Energy Efficiency in Industry A new report by the American Council for an Energy-Efficient Economy (ACEEE), Washington, D.C., highlights successful program strategies to realize the large potential energy savings in the industrial sector. The report, "Industrial Energy Efficiency Programs: Identifying Today’s Leaders and Tomorrow’s Needs," finds that industrial-sector energy savings have remained untapped by many existing publicly funded energy-efficiency programs.

Energy efficiency in the industrial sector represents a low-cost resource compared with other sectors, but running successful programs for this sector requires different approaches than are traditionally used in other sectors. The new report identifies leading industrial programs and successful program strategies and suggests directions for programs looking to start or expand offerings to realize the energy-efficiency savings in this sector.

The report reviewed more than 30 industry-focused energy-efficiency programs in the United States and Canada, and offers new insights into current trends in today's industrial energy efficiency programs. It also discusses emerging challenges that such programs will have to address in the near future. These challenges reflect the industrial sector's complexity where many efficiency opportunities are site-specific. The report finds that successful industrial efficiency programs build relationships with their industrial customers and provide flexible program offerings to meet these challenges.

"This report is timely because of the important role of the industrial sector to contribute to energy-efficiency savings and greenhouse gas-emission reductions," says Anna Chittum, lead author of the report and associate with ACEEE’s Industrial Program. "As more states, as well as the federal government, set more aggressive energy-savings targets, we need the significant savings available from the industrial sector to achieve these goals and keep costs down for everyone."

Industrial energy-efficiency programs have existed for decades across the United States and Canada, but these programs have not historically maximized savings opportunities and many publicly funded programs have not invested time and resources to develop programs to effectively serve this sector. “To achieve the energy savings required by the substantial energy-savings goals out there, we have to learn how to make today's industrial energy-efficiency programs as effective as possible,” says Dr. Neal Elliott, ACEEE’s associate director for research and a co-author of the report.

"Improving these industrial programs is our best opportunity for achieving significant energy savings in the industrial sector." One important trend the report notes is the emergence of "self-direct" industrial programs, in which large industrials have the opportunity to utilize public benefits funds — which would otherwise support industrial efficiency programs — to make these investments in their own facilities. In these situations, the facilities themselves are responsible for meeting savings targets stipulated by the program administrator. The report finds that the few well-designed self-direct programs actually behave similarly to mature customized incentive programs. Both well-designed self-direct programs and mature customized incentive programs deliver large and low-cost energy-efficiency savings.

The report also lays out important lessons learned about industrial programs generally for those looking to establish new industrial energy-efficiency programs. "So many utility and public benefit programs are looking to achieve more savings from their industrial customers," says Nate Kaufman, a co-author of the report and research staff with ACEEE’s Industrial Program. "This report shows that there is still plenty of room for improvement. Industrial programs can look to the leading programs to learn how to make their programs better." The report can be downloaded for free from the ACEEE Web site or a hard copy can be purchased online for $25 plus $5 postage and handling.

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