Electricity Demand Likely to Drop by 15 Percent

February 27, 2012
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A survey of 50 energy experts released by economists at The Brattle Group reported that energy efficiency is likely to cause a drop of 5 to 15 percent in U.S. electricity consumption by the year 2020, relative to forecast trends. The study, “Energy Efficiency and Demand Response in 2020 – A Survey of Expert Opinion,” was co-authored by Brattle economists Ahmad Faruqui and Doug Mitarotonda in coordination with Global Energy Partners (GEP), an Enernoc company.

Electric peak demand is likely to drop by 7.5 to 15 percent compared to forecast trends, and natural gas consumption is expected to drop by 5 to 10 percent compared to forecast trends.

These reductions will likely be brought on by factors such as the rising costs of generating and delivering electricity and natural gas, rapid advances in appliance and building technology, innovative rate design, and cultural shifts in American values that encourage behavioral change, said The Brattle Group.

Further, The Brattle Group said the analysis reveals a surprising consensus on the size of the impact from increased energy efficiency in the United States. However, it also finds considerable variation across regions, sectors, programs, and end uses. For instance, the West North Central Division is expected to only see savings in electricity consumption in the 1.5 to 2.5 percent range, while the Mountain Division is expected to see savings in the 5 to 16 percent range.

Significantly, dynamic pricing programs are expected to garner between 7.5 to 20 percent of residential consumers, while participation rates for commercial and industrial consumers will range from 10 to 30 percent, the survey said. “The survey clearly shows that the age of energy efficiency has not come to an end,” said Ahmad Faruqui. “On the contrary, the survey heralds a period of acceleration for energy efficiency.”

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Publication date: 02/27/2012

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