NEW YORK, Apr 21, 2008 -- BUSINESS WIRE

Energy efficiency improvements in the U.S. electric power sector could reduce the need for new electric generation by an additional 7 to 11 percent more than currently projected over the next two decades if key barriers can be addressed, according to a preliminary analysis of potential energy savings released today.

The analysis comes at a time when utilities, regulators, and policymakers are aggressively seeking ways to meet growing electricity demand, while reducing the carbon footprint of the U.S. economy. The key challenge is to maximize potential gains in energy efficiency, while ensuring adequate new electric generation to maintain reliability and meet future demand.

The draft findings were presented by the Electric Power Research Institute (EPRI) and the Edison Electric Institute (EEI) during an Edison Foundation conference, Keeping the Lights On: Our National Challenge, which examines strategies to meet the growing demand for electricity which is expected to soar 30 percent by 2030, according to the U.S. Energy Information Administration.

That demand growth projection would be even higher without the implementation of existing building codes, appliance standards and market-driven consumer incentives, which will shave electricity consumption by 23 percent, according to the EPRI-EEI study. However, additional efficiency gains could be achieved only by overcoming major market, regulatory and consumer barriers, the analysis found.

"This study demonstrates the potential of energy efficiency to offset some of the projected need for new electric generation as cutting-edge technologies become available and are adopted," said Dr. Michael Howard, senior vice president at EPRI. "We think a 7-percent efficiency improvement is realistic - and gains of 11 percent or more are technologically feasible - depending on the degree to which various obstacles can be overcome."

Essential steps include increased consumer education; adoption and enforcement of aggressive building codes and appliance standards; creation of utility business models that promote increased efficiency within the power sector; and adoption of electricity pricing policies that more accurately reflect the cost of providing electricity to consumers - and give them the information they need to use it wisely.

Diane Munns, executive director at EEI, said the power sector will seek the greatest efficiency gains possible, but cautioned that this will be no easy task and that utilities still must plan for substantial new generation and transmission to assure reliability.

"Achieving efficiency improvements going significantly beyond those already in the pipeline will be a major undertaking," Munns said. "No matter how you slice it, we'll have to build significant new generation to ensure that we meet demand. The greater gains we make in energy efficiency, the better off everyone will be, because we'll have more cost-effective options for serving our customers," she said. "But if we overestimate what can be accomplished, we could find ourselves without an adequate supply of electricity to meet consumer needs."

Optimal electricity savings can be achieved only if the best available technologies are deployed throughout the U.S. economy, EPRI and EEI said. Much of the research involved in realizing more efficiency is being conducted by EPRI at its Living Laboratory for Energy Efficiency in Knoxville, Tenn.

EPRI's programs and collaborations that evaluate cutting-edge technologies have identified numerous opportunities to markedly improve energy efficiency through use of "smart" and highly efficient electrical devices. For example, direct energy feedback devices, such as household thermostats that respond automatically to electricity price or demand signals, can cut energy use and save customers money.

At the same time, consumers' ever-increasing appetite for electricity-hungry devices - even with continuing efficiency improvements - will keep electricity demand on a steady upward trajectory. A 42-inch plasma television consumes two and a half times more energy (250 watts) than a standard 27-inch TV (100 watts). And while many large household appliances have become more efficient over the years, many smaller devices have not. Two 30-watt set-top television boxes, for example, may consume as much electricity as a large refrigerator.

"While electricity rates will rise due to increasing across-the-board costs of producing electricity, energy efficiency improvements can help reduce some of these costs to consumers," Munns said. "To maximize utility investment in efficiency programs, energy efficiency must be treated as an energy resource on par with new generation."

"We are making remarkable technological advances in the area of efficiency," Howard said. "The question is how much more can we achieve? The key will be finding the will to fully demonstrate and adopt both currently available and emerging, hyper-efficient electric technologies."

Copies of the EPRI-EEI presentation are available on the Edison Foundation's Web site, www.edisonfoundation.net

About the Electric Power Research Institute

The Electric Power Research Institute (EPRI) leads research, development and demonstration of technical and operational solutions in electricity generation, delivery and use. The focus and application of EPRI's research and activities span virtually every aspect of the power industry, including reliability, safety, the environment, and energy efficiency. The Institute's collaborative model engages EPRI members, participants, scientists and engineers, along with experts from academia and other business sectors. As an independent, nonprofit center for public-interest energy and environmental research, EPRI's work is supported both by its members, which represent more than 90 percent of the electricity generated in the United States, and by growing international participation, representing more than 15% of EPRI's program support.

The Edison Electric Institute (EEI) is the association of U.S. shareholder-owned electric companies. Our members serve 95 percent of the ultimate customers in the shareholder-owned segment of the industry, and represent approximately 70 percent of the U.S. electric power industry. We also have more than 65 International electric companies as Affiliate members, and more than 170 industry suppliers and related organizations as Associate members. Visit www.eei.org.

SOURCE: Electric Power Research Institute

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