METRICS FOR ENERGY EFFICIENCY: OPTIONS AND ADJUSTMENT MECHANSIMS

The document advocates for outcome-oriented energy efficiency metrics, such as kWh per customer, as a more transparent and less administratively burdensome alternative to measure-by-measure savings calculations. It details several potential metrics, discusses the necessity of adjustment mechanisms for exogenous factors like weather and GDP, and provides recommendations for regulators to minimize regulatory conflict by using independently verified data.

• Traditional measure-by-measure savings approaches for energy efficiency are prone to regulatory conflict because the assumptions used to estimate savings often have "significant levels of uncertainty as well as annual variation."
• Outcome-oriented metrics, such as total sales or kWh per customer, are presented as superior to measure-by-measure approaches because they are easier to monitor, can be more directly tied to state greenhouse gas targets, and reduce the administrative burden on commissions.
• To avoid disputes when revenue is at stake, adjustment mechanisms for exogenous factors should rely on "independently verified data" and pre-agreed data sources, such as officially published weather or economic data, rather than counterfactual studies.
• The authors identify seven potential outcome-oriented metrics: kWh per capita, kWh per customer, kWh per household, kWh per square foot, kWh per $ GDP, total sales (kWh), and annual percent improvement from a baseline year.
• The 'kWh per customer' metric is recommended as the most effective option because it is easy to measure, transparent, and difficult to manipulate, requiring only weather adjustments if the number of meters is kept fixed to account for economic growth.
• The document suggests that focusing too heavily on the 'attribution problem'—determining the proportion of savings caused by utility intervention versus exogenous factors—can inhibit energy savings, as seen in California's experience with the net-to-gross ratio.

APA

ORVIS, R., AGGARWAL, S., & O’BOYLE, M. (2016). METRICS FOR ENERGY EFFICIENCY: OPTIONS AND ADJUSTMENT MECHANSIMS. Energy Innovation. https://energyinnovation.org/wp-content/uploads/EEMetricDesign-white-paper_final.pdf

Chicago

ORVIS, ROBBIE, SONIA AGGARWAL, and MICHAEL O’BOYLE. METRICS FOR ENERGY EFFICIENCY: OPTIONS AND ADJUSTMENT MECHANSIMS. Energy Innovation, 2016. https://energyinnovation.org/wp-content/uploads/EEMetricDesign-white-paper_final.pdf.

Wikipedia

{{cite report |last1=ORVIS |first1=ROBBIE |last2=AGGARWAL |first2=SONIA |last3=O’BOYLE |first3=MICHAEL |title=METRICS FOR ENERGY EFFICIENCY: OPTIONS AND ADJUSTMENT MECHANSIMS |publisher=Energy Innovation |date=April 2016 |url=https://energyinnovation.org/wp-content/uploads/EEMetricDesign-white-paper_final.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{orvis2016metrics, author = {ORVIS, ROBBIE and AGGARWAL, SONIA and O’BOYLE, MICHAEL}, title = {{METRICS FOR ENERGY EFFICIENCY: OPTIONS AND ADJUSTMENT MECHANSIMS}}, institution = {Energy Innovation}, year = {2016}, month = apr, url = {https://energyinnovation.org/wp-content/uploads/EEMetricDesign-white-paper_final.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }