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Berkeley Lab Calculates ‘Cost of Saved Energy’

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Energy efficiency programs that are paid for by utility customers cost, on average, about two cents per kilowatt-hour saved.

By examining regulatory reports on efficiency programs in 31 states, Lawrence Berkeley National Laboratory researchers have determined the cost of saving energy through efficiency programs funded by utility customers in the period 2009-2011.

In the report, “The Program Administrator Cost of Saved Energy for Utility Customer-Funded Energy Efficiency Programs,” calculations of the cost of saved energy (CSE) are based upon gross energy savings and the costs borne by the program administrator.

Among the findings:

  • The US weighted-average electricity CSE was slightly more than two cents per kilowatt-hour ($0.021/kWh). This levelized CSE is lower than values reported by other studies, but it should be noted that this study contains the largest sample of program administrators to date.
  • Commercial, industrial and agricultural efficiency programs had an average levelized CSE of $0.021/kWh.
  • Efficiency programs in the Midwest had the lowest average levelized CSE ($0.014/kWh) while programs in Northeast states had a higher average CSE value ($0.033/kWh). The average CSE for programs in the West and South were $0.023/kWh and $0.028/kWh, respectively. Note that only four states in the South are included in this report.
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