NASEO 2018 Western Region Meeting Rural Energy Affordability, - - PowerPoint PPT Presentation

Michael Leitman Strategic Analyst NRECA Business and Technology Strategies michael.leitman@nreca.coop

NASEO 2018 Western Region Meeting Rural Energy Affordability, Efficiency, and Economic Development

Co-ops in NASEO Western Region

• 6 G&Ts, 110 Distribution Utilities

(includes 16 NRECA member public, tribal and mutual utilities)

• Serve about 1.4 million

consumer-members and 2.7 million people

• About 7% of nationwide co-op

sales and consumer-members.

• Nationwide, 42% of distribution

lines 8 meters per line mile.

Power Supply and Affordability

• Affordability starts with power supply.
• Hydropower is a vital resource in the West, supplying around 45% of the

power sold by co-ops in the region.

• Wind and solar generation are also seeing rapid growth.
• Renewables play a particularly helpful role in affordability in non-grid

areas of the region by offsetting diesel generation.

• Co-ops are experimenting with storage and microgrids.
• Consideration of joining or forming new organized markets.

Co-op Demographic Challenges

• Co-ops serve about 2.7 million people across the region.
• Average household income in co-op areas is about 16% below the

regional average, and 10% below the U.S. average.

• 31% of households have incomes under $35k most vulnerable to

increased home energy costs.

• Population in poverty is about 16%, about 2% higher than the regional

and U.S. average, but with particularly high rates of over 20% in Arizona and New Mexico, including persistent poverty counties facing long term challenges.

• Affordable electricity is a cornerstone for electric cooperatives.

Co-op Housing Stock Challenges

• Housing stock is dominated by single detached homes, with low density and

fewer large multi-unit structures, making large efficiency projects difficult.

• There is a much higher share in manufactured (mobile) homes, about 17%,

three times the regional average.

• Households primarily heated by electricity matches the regional average of

34%, co-op areas have lower availability of utility natural gas (35% vs. 55%).

• Rural areas often lack a network of trained installers for efficiency and

weatherization improvements.

Co-op Demand Side Programs

• Cooperatives in the region offer a variety of demand-side programs.
• Energy audits for various consumer types (e.g. residential, C&I, farm) are

widespread, and many offer weatherization programs directly or through approved local area service providers.

• Many offer rebates and/or financing programs promoting efficient

technologies, especially HVAC, water heating, and large appliances, many as part of the Energy Star program.

• A growing number offer some form of time-based rates, which can

incentivize participants to shift usage to less expensive times, reducing costs for all members.

Beneficial Electrification

• Beneficial Electrification: The use of electricity in end-uses that would
• therwise be powered by fossil fuels (natural gas, propane, fuel oil, or

gasoline) to reduce greenhouse gas (GHG) emissions.

• The low-carbon energy mix in much of the West puts the region in a

particularly good position to capture these gains.

• Heat-pump technologies are more efficient for HVAC and water heating.
• These tend to have higher up front costs than alternatives, so programs

to help reduce these costs are helpful.

• Congress just extended tax-credits for geothermal HVAC through 2021.

Beneficial Electrification, ctd.

• Growing opportunities around electric vehicles, both for business and

private use.

• Western Farmers Electric Cooperative Geo Validation Pilot Program installed

ground loops and heat pumps in Oklahoma and New Mexico.

• Some members are testing a “Thermal Services” model in which the

cooperative installs, owns and maintains the ground loop and is repaid over time through on-bill payments based on verified energy savings.

• Work with a consortium of vetted and verified installers.
• Having a big impact in ensuring that new-build housing developments come

equipped with ground source heat pumps infrastructure.

Manufactured Home Programs

• Mobile homes make up about 16% of the housing stock in co-op areas,

three times the regional average.

• These are particularly challenging from an efficiency standpoint.
• The vast majority were manufactured before HUD increased efficiency

codes in 1994, and a good share before any codes at all.

• BPA has taken a lead in programs

Manufactured Home Programs, ctd.

• Mobile homes make up about 16% of the housing stock in co-op areas,

three times the regional average.

• These are particularly challenging from an efficiency standpoint.
• The vast majority were installed before HUD increased efficiency codes

for manufactured homes in 1994, and a good share before any codes at all.

• Northwest Energy Efficient Manufactured Housing (NEEM) program is

national model.

Community Solar & Storage

• Cooperatives are leaders in Community Solar programs nationwide.
• While solar costs have declined rapidly across the board, utility-scale

projects remain more cost effective.

• This shared model of service allows all members to participate even if

they are renters or lack a suitable rooftop.

• NRECA is working with partners and members on Community Storage

programs, including battery and thermal storage options.

Community and Economic Development

• Co-ops have a long history of fostering development in their communities.
• Many co-ops have economic development programs, using financing from

USDA REDL&G loans and grants, partnerships with credit unions and other lenders, and unclaimed capital credits to finance local renewable projects, business parks, and community resources.

• LIHEAP and programs such as Operation-Round-Up used to help members,
• ften through charitable foundations.
• Also offer youth programs and college scholarships for local students.
• Today, broadband is a major focus, leveraging the infrastructure from wide-

spread AMI deployment to attract broadband developers, form partnerships, or in some cases set up broadband subsidiaries.

• Nationwide, co-ops also return more than $1 billion in capital credits

annually to members, keeping money in the local economy.

Policies to Aid Affordability

• Expand the trained workforce in rural areas for energy efficiency and other

demand side projects through local community and technical colleges.

• Support Beneficial Electrification to replace less efficient non-electric

technologies, as well as supporting the replacement of less efficient electric and mixed systems at the end of their life.

• Help promote more efficient new manufactured housing, repairs and

retrofits to existing stock, and programs to promote the replacement of the

• ldest pre-1976 stock (e.g. “Cash for Clunkers”).
• Policies that support community options for renewable and storage.