How is Energy Efficiency Handled in the Clean Power Plan?
Though end-use energy efficiency is not considered a “building block” for compliance with the U.S. Environmental Protection Agency’s Clean Power Plan (CPP), it remains a key part of states’ compliance plans. At a workshop of the Southwest Energy Efficiency Project (SWEEP), John Shenot outlined the framework of the CPP, the performance standard options for Arizona, the paths by which the state can comply (the “rate-based” vs “mass-based” approach), and where energy efficiency fits in each one. A mass-based standard covering both existing and new sources, in which CO2 allowances for each ton of emissions are distributed in advance through allocation, auction, or sale, is by far the easiest to implement because of the flexibility it allows for energy efficiency and renewable energy options.
In a separate workshop discussion, Mr. Shenot addressed how Arizona and other states can take advantage of the Clean Energy Incentive Program (CEIP), a part of the CPP that will award matching federal allowances or emissions reductions credits to incentivize early action on emissions reduction. In addition to wind and solar, energy efficiency projects in low-income communities are eligible for the CEIP.