Estimating Industrial Electricity Conservation Potential in the Pacific Northwest

Abstract

The Pacific Northwest is undergoing a transition in electricity generation from a predominantly hydro system to a combined hydro-thermal system. The high marginal costs of thermal generation relative to the low-cost hydropower base have made the search for alternatives very important. The cost of many conservation measures is less than the cost of new generation. This paper describes the results of an evaluation of industrial electricity conservation measures. Using a detailed end-use data base on industrial electricity consumption in the Pacific North west (PNW), nine most electricity intensive industry groups at the 4-digit SIC level were selected. An engineering economic analysis of conservation measures was performed for representative plants in each industry group. The plant level conservation estimates were extrapolated to the 4-digit and 2-digit SIC levels. An analysis of the market penetration of each conservation measure was performed using a distribution of desired rates of return.

Government programs to encourage electricity conservation were identified, and their costs and effectiveness were assessed. The paper describes the methodology and significant findings of the study.