POWER SYSTEM PLANNING • The second role is related to saving the different
CHAPTER 5 – ENERGY EFFICIENCY forms of energy. It is seen in the global scene of
Introduction
• Energy efficiency is the efficiency of using energy. We
are interested in the broader sense of energy
efficiency meaning how much output is produced by
an end-use device when it consumes energy and
how can we improve on this situation?
• In this context we are interested in doing more work
for less energy. At home for example, when we talk
about cooling, heating, or refrigeration we mean
how best to achieve our objectives with the least
consumption of energy?
• The inverse of energy efficiency in called energy
intensity. Increasing energy efficiency, or reducing
energy intensity, in most cases, will reduce energy
consumption and therefore, conserve energy. It often
will reduce costs and save money. The term energy
efficiency is used to describe efforts to reduce the
amount of energy required for leisure or to provide
products and services.
• Some of the examples include efforts such as
insulation, building materials, passive architecture,
energy saving light bulbs, more energy efficient
appliances, and altering consumption habits. Energy
efficiency also includes the design of efficient systems
and controls. For example temperature control or
process control are considered tools used in effecting
energy efficiency. Moreover, efficient building
designs and utilizing natural weather conditions are
ways to use energy efficiently.
• The objectives of performing energy efficiency are as
follows:
o Reducing energy costs, which may result in a
financial cost saving to consumers, utilities, and
the national economy
o Reducing environmental pollution
o Rationalizing the use of energy so that resources
can last longer
o Increasing security of energy supply by slowing
down the rate of depleting resources.
• Energy efficiency efforts are based on convincing
consumers to adopt energy efficiency measures.
Therefore, awareness is needed to educate
consumers about energy efficiency, available
technologies, processes, and benefits. When
consumers are convinced that there is a personal (or
societal) need to use energy more rationally then
energy efficiency programs succeed.
• Sometimes this convincing needs either an incentive
(carrot) or enforcing (stick) or a combination of both.
Once a reasonable level of awareness is reached
consumers voluntarily accept and become part of
energy efficiency efforts.
• Energy efficiency is the way to go forward; therefore,
countries are exerting all efforts to moving their
citizens to be more energy efficient. One should
realize the importance of energy efficiency as it can
help prolong the useful life of existing resources,
protect the earth and safeguard human beings.
• Thus energy efficiency has three main roles:
1) protecting the environment,
2) rationalizing the use of the different forms of
energy, and
3) saving money
• The first role is achieved through institutionalizing
energy efficiency tools and mechanisms. This in turn,
is achieved through manufacturing and trading
energy efficient products and hence cutting down
on the amount of energy consumed, which implies
less pollution into the environment. The change may
be also brought about by making people behave
differently when it comes to purchasing appliances,
or how they use such appliances at homes and
offices.
seeking alternative fuels that lead to energy
efficiency. As there is an escalation of the prices of
fossil fuels, due to an imbalance between supply and
demand, energy efficiency is an effective tool to
help save on fossil fuel usage. Eventually, people will
move from being dependent on fossil fuels and
switch to depending on alternative options.
• Finally, saving money is the biggest contribution of
energy efficiency. At the end of the day customers
seek to reduce their energy bills which is consumed
by vehicles, appliances, heating cooling, etc. As a
result of energy efficiency measures customers will be
using much less energy and hence save money. It
should be emphasized, however, that energy
efficiency requires some sacrifice on the side of
customers. This is manifested by some self-imposed
changes to their lifestyles and energy consumption
patterns.
• To sum up, it can be stated that energy efficiency is a
general term used for all energy forms including
domestic or industrial fuels and electricity. Usually
energy efficiency efforts are directed to all forms of
energy because of the interchangeability and
switching among the various types.
• This is a requirement to guarantee the success of any
energy efficiency measure, since for a single
consumer all energy forms, used by this particular
consumer, compete together
ENERGY EFFICIENCY IMPACT ON ELECTRICITY
CONSUMPTION
• Energy efficiency involves activities that effect and
encourage a drastic change in electricity
consumption by end-users. It also involves the design
and manufacture of energy efficient appliances and
systems.
• In essence what energy efficiency means is to
achieve the following goals:
1) buildings are constructed such that to have
efficient use of energy,
2) appliances are designed and designated as
energy efficient or otherwise, and
3) behavioral changes to electricity end-users.
• In all that, there must be a shared responsibility
among all stakeholders including regulatory bodies,
electricity companies, appliance and systems
manufacturers, architects, construction engineers,
investors and contractors, and end-users. If all
stakeholders shoulder their responsibility then energy
efficiency will achieve its goals.
• In order to have a successful energy efficiency
program or activity we must make energy more
valued and appreciated by the stakeholders. We
must also build awareness by education and
motivation. This will lead us to the transformation of
behavior, which is considered the critical point in the
success or failure of any energy efficiency program or
activity. In other words if all stakeholders including
end-users reach to point whereby energy efficiency is
a priority to them then we can with confidence
assume that there will be success.
• Numerous benefits can be received by focusing on
increasing the efficient use of energy. These benefits
for increasing electric energy efficiency that cannot
be disputed are as follows:
➢ Lower energy bills: By decreasing energy
consumption, as compared to what was
expected, the average user will receive a lower
energy bill.
➢ Lower cost: Compared to supplying electricity
only from new power plants. Energy efficiency
programs can help defer investments in new
plants and lower the total cost of delivering
electricity.
 ➢ Modular and quick to deploy: Demand side • Other information is also available on the energy
management programs can be ramped up over label apart from the clear color-coded classification.
one to three years to deliver considerable For example, the energy label for light bulbs often
savings. Programs can target areas that are shows its ‘lumen,’ an indication of perceived power
congested where providing new supply is difficult of light, and ‘Watt,’ the consumption of joules of
in the near term. energy per second.
➢ Environmental benefits: Many of the negative • This energy label enables consumers to compare
environmental impacts of electricity generation appliances on the basis of energy efficiency, in
are mitigated through energy efficiency: addition to other considerations. Moreover, it
lowering air pollution, reducing greenhouse gas provides an incentive for manufacturers to improve
emissions and decreasing water use. the energy performance of their products.
➢ Economic development: Investments in energy
efficiency helps to create jobs and improve local
economies. Energy bill savings often gets
redirected towards activities that increase
employment. Long-term economic value is
increased through energy efficiency investments
in long-lasting property improvements to
buildings.
• Changes in energy consumption practices and
installed energy efficient measures utilized by the
consuming sectors are what provide these benefits.
These benefits are accrued by avoiding the costs of
increasing capacity for supplying energy. As energy is
reduced throughout the entire year, the supply curve
is shifted downward, therefore reducing marginal
energy and capacity costs.

APPLIANCE EFFICIENCY
• The new designs for electrical appliances target
energy efficiency more than any other parameter.
This trend is picking up momentum world wide.
People are more aware than before about energy
efficient appliances and consider it one of the most
important factors influencing purchase. The main
driver to this behavioral change is the cost of energy
supply to homes, offices, and other businesses.
Consumers look for more efficient appliances to save
on their bills.
• Manufacturers, on the other hand, compete to have
a strong foothold in the market. They know that if their
products are not energy efficient they will be driven
out of market. Simultaneously, governments provide
several types of incentives to both consumers and
suppliers to select energy efficient appliances. All
these efforts culminate in replacing all appliances in
the market to energy efficient models.
• Many countries have adopted a labeling scheme to
point out to consumers about the energy
consumption of each appliance offered in the
market. This way consumers are well informed and
can take their decision to buy based on actual
independent assessment of the performance of
electrical appliances. Usually the labeling is carried
out by an independent third
party.
• All electrical appliances sold in
the markets of most countries
carry an energy label. Figure 1
is a washing machine label, as
per EU, and Figure 2 as per
Australia for heat pumps.
• The energy efficiency of the
product is rated in energy levels
ranging from A to G on the
outside label. ‘A’ stands for the
most energy efficient and ‘G’
for the least energy efficient.
• This Energy label for household
appliances is based on EU
Directive 92/75/EU. It provides
reliable and easily comparable
information on the energy
consumption of household
appliances. For refrigerators A+
and A++ are also available for
very low energy consumption
appliances.
BUILDING EFFICIENCY
• There is great potential for energy savings in any
community, municipality, or city. This energy saving
potential combines electricity and other energy
forms as well as water, waste, and all other utilities in
an effort to maximize the benefit). The energy saving
opportunities can be classified as per the introduction
stage as follows:
➢ Savings in the design stage of buildings and
facilities
➢ Savings in the implementation stage of buildings
and facilities
➢ Savings at a later stage as retrofit for existing
buildings and facilities promotion of energy
efficiency programs
➢ Promotion of energy efficiency programs at all
times
Savings in the design stage of buildings and facilities:
o Selection of the most energy efficient equipment
(including central air conditioning systems, air
handling units, chillers, lighting systems, etc.)
o Passive architecture designs (including natural
lighting, natural air circulation and ventilation, double
glazing, sun curtains, insulation materials for walls and
roofs, etc.)
o Selection of most efficient utilities (combined heat
and power, district heating system, common large-
size units, pressurized water systems, etc.)
o Proper design of the local electricity network
(including voltage level, conductor cross sections,
transformer ratings, substation arrangements, etc.)
o Selection of efficient street lighting system.
o Provision for mass transit systems for passengers and
freight (including light rail, escalators and people
movers, etc.)
o Provision for the introduction of renewable energy
sources (including solar water heaters, photovoltaic
electricity generators, fuel cells, etc.)
o Provision for biogas plant for electricity generation
from solid, municipal and industrial wastes.
o Selection of local raw materials, as much as
applicable, to conserve energy in transporting such
materials from long distances.
Savings in the implementation stage of buildings and
facilities
o Proper installation of systems and utilities.
o Use of original equipment and parts from genuine
OEMs.
o Following recommendations of OEMs.
o Selecting energy efficiency knowledge and
experience as a main criterion in selecting
contractors.
o Use of energy efficiency consultants in preparing
tender documents including specifications,
performance criteria, minimum requirements, etc.
o Short listing of appropriate certified and qualified
contractors.
o Appointing an energy manager in large projects.
o Use of energy efficiency consultants to monitor
progress of contracts.
o Use of contract bonus schemes for engineering value
judgment of contractors.
o Third party inspection of equipment for large scale
utilities.
o Performance testing prior to acceptance.
o Conformance to energy efficiency specifications
guarantees.
o Coordination meetings with all contractors during
implementation to monitor energy efficiency issues.
Savings at a later stage as retrofit for existing buildings
and facilities promotion of energy efficiency programs
o Conducting life-cycle cost replacement feasibility
studies for non-efficient equipment.
o Replacement of non-efficient equipment.
o Introducing Demand Side Management (DSM)
studies to determine cost-effectiveness of certain
programs for implementation.
o Introducing power factor improvement measures.
o Introduce electricity loss reduction programs.
o Introduce harmonics reduction programs.
o Increase electrical system reliability to increase
customer satisfaction and therefore, willingness to
pay for electricity.
o Designing certain incentive schemes for energy
efficiency programs.
o Conducting energy audits for industries, commercial
buildings, office buildings, recreational facilities, etc.)
o Introducing energy efficiency programs as a result of
the energy audits.
o Provision of financing schemes for the replacement
process.
Promotion of energy efficiency programs at all times
o Introducing Energy Service Companies (ESCOs) to
provide for energy efficiency programs for
consumers.
o Negotiating with the power, water, gas, municipal
waste utilities to have long term supply contracts to
benefit from reduced rates.
o Negotiating with the power utility/ company to have
an agreement to supply power to the network, from
in-site power generation facilities, for the same rate
as power purchased.
o Negotiating with the power utility/ company to have
interruptible load agreements for certain non-critical
loads to reduce electricity bills.
o Introduce local distribution tariffs for electricity, fuels,
gas, water, municipal waste, and all other utilities.
o Conduct awareness campaigns for energy efficiency
and appropriate programs.
o Conduct training programs for energy staff of large
commercial complexes, industries, high-rise office
buildings, facilities, etc.
o Promote the introduction of energy manger posts at
large commercial complexes, industries, high-rise
office buildings, facilities, etc.
o Promote the concept of green energy for businesses
that use or purchase power from green energy
sources.
o Introduce energy efficiency labels for equipment as a
mandatory requirement for manufacturing, importing
or selling any equipment.
o Introduce energy efficiency standards and codes for
building insulation.
o Introduce energy efficiency awards and prizes.
Building Energy Rating
• The BER label provides an indication of the energy
performance of the dwelling. BER compares the
energy demand and performance of a building. It is
similar to the energy label for a household electrical
appliance like the fridge.
• It is related to energy use for space heating, water
heating, ventilation, and lighting. The BER, similar to
the appliance label has a scale of A-G. “A” rated
homes are the most energy efficient and “G” the
least efficient.
• A detailed procedure is usually outlined to grant the
BER certificate. This differs from country to another,
however, all developed countries agree on the
vitality of issuing the BER certificate. Failure to secure
the BER certificate at the correct time results in
paying a fine and incurred delays in the legal
completion of the sale or leasing.
• In the USA, a BER certificate is compulsory for almost
all new homes since mid-2008. From 1/1/2009 a BER
certificate is compulsory for all homes being sold or
rented. It is the responsibility of the seller/landlord of
the property to provide this certificate for the buyer
or tenant.
• A BER is valid for up to 10 years provided there is no
material change to the dwelling that could affect
energy performance. Provisional Building Energy
Ratings for houses sold off plans are valid for 2 years.
On completion of such houses a full BER must be
supplied to the buyer.
• A BER is based on the characteristics of major
components of the dwelling, i.e.:
➢ Wall, roof, and floor dimensions,
➢ Window and door sizes and orientations
➢ Construction type and levels of insulation,
➢ Ventilation and air tightness features,
➢ Systems for heat supply,
➢ Type of lighting.
• Moreover, BER covers annual energy use for space
heating, water supply, ventilation, lighting and
associated pumps and fans calculated on the basis
of a typical family with a standard pattern of
occupancy. The energy performance is expressed as:
➢ Primary energy
use per unit
floor area,
which is
represented on
a scale of A-G
➢ Associated
CO2 emissions
per meter
squared per
year.

IMPROVING ENERGY EFFICIENCY
Manufacturing
• Many energy-intensity industries use fuels for heating,
manufacturing metals, treating ores, producing
chemicals, and other uses. Much of the heat that is
exhausted up smokestacks or otherwise wasted, or of
some the steam used in the manufacturing process
can be re-used. For example, it can be used to
preheat the air which is mixed with fuel before the
fuel is burned. This process is called preheating fuel.
To recover heat, a heat exchanger is used. A
household water heater is an example of a heat
exchanger. In this heat exchanger hot air, composed
of combustion products, is used to heat up water in a
tank. There are many types of heat exchangers and
many different uses for waste heat.
• Generating electricity for own use is another way
whereby some industries save energy, although this is
not considered more efficient than electricity
produced by large power generating plant.
However, overall energy is saved by utilizing the
waste heat. This is called “co-generation.” Another
way of increasing overall efficiency of energy use in
industries is what is called “combined heat and
power” or CHP. This is where both electricity and
steam are produced and used in the plant. The
industrial plant designs a large enough boiler to cover
for both purposes instead of having two boilers for
two separate purposes. This way the efficiency of the
larger boiler is higher than the sum of the efficiency of
the two smaller ones.
Transportation
• Cars today get many more kilometers per liter than
the cars of the early 1970’s and earlier. This is
because newer cars are lighter in weight, have
smaller engines, and are more aerodynamic. They
don’t accelerate as fast or are not built with to have
room for many passengers as their predecessors.
However, due to an increase in human mobility and
improved road networks there has been an increase
in gasoline consumption. If fuel efficiency of cars did
not improve the gasoline consumption would have
witnessed a much higher increase than it really has.
• The energy efficiency of trains is usually a few times
better than trucks due in part to the low rolling
resistance of the steel wheels of trains and due to the
fuel consumption per ton hauled. There is also less
wind force for a train since a train car is partly
shielded from the headwind by the car in front of it.
• Passenger energy efficiency (in passenger kilometer
per liter) is usually (but not always) about the same
for most modes of transportation. Intercity buses are
the most energy-efficient. Mass transit, as currently
operated, is not much more energy efficient than the
automobile. This is dependent on what percentages
of the seats are occupied. If the speed of a vehicle is
doubled the wind force increases 4-fold.
• Therefore, a short high speed train or light rail, as they
are called, may be less energy efficient than a small
automobile at lower speed. As for airplanes, they fly
high in the sky whereby the thin air helps reduce the
wind force; however, their high speeds cancel out
this advantage.
Residential and Commercial
• Most of this energy is for heating, lighting, and cooling
of buildings. Buildings in this context means
residential, office, and commercial buildings. Better
insulation in new buildings is required by law in many
countries. In some countries building codes require
even existing buildings to install insulation in the roofs
and walls to improve energy efficiency.
• Fluorescent lighting is more efficient that
incandescent lighting. Moreover, Compact
Fluorescent Lighting (CFL) is more efficient than the
regular fluorescent lighting. Solar energy can heat
water (or swimming pools)by having the sun heat
water in pipes on rooftops. Solar collectors that do
this may sometimes be seen on the rooftops of
buildings.
INCENTIVES MECHANISMS TO EFFECT EE
• In order to institute ant energy efficiency program or
activity it should first of all be cost effective.
Otherwise it will not last and not be instrumental. The
cost of any program or activity should be borne by
someone. Moreover, the benefits that would accrue
must cover the costs and have some balance
remaining to provide incentives for participants.
• These incentives drive participation from consumers
and electric companies. Other indirect participants
such as market players involved in manufacturing,
importing or trading with efficient appliances are
rewarded through market itself. The inauguration of
energy efficiency programs will open market
potential and business.
• The calculation of incentives is based on the
potential savings that would result from implementing
the programs. However, there should be some
allowances for errors in estimating the savings.
Naturally the information needed for program design
come from load research studies.
• The errors may come from several areas, including
inter-alia, the following:
➢ Misconception on the part of volunteering
participants which would lead to early
withdrawal from the programs
➢ Wrong or overestimated information about
energy saving potential
➢ Underestimation of costs especially costs of
administrating the programs
➢ Market distortions including competing non
efficient appliances, counterfeits, black market,
etc
➢ Lack of enabling legislations and regulations.
• In certain cases were electricity tariffs are subsidized
energy efficiency might not work. This is because the
market forces are distorted and do not reflect the
true cost of delivering power to consumers. Therefore,
the electricity company will not have the motive and
thus the willingness to participate in any energy
efficiency program. At the same time the consumer
will also not be motivated to participate. Similarly the
market will not be interested to acquire energy
efficient appliances or build efficient buildings.
• The aim of providing incentives is not to create the
energy efficiency opportunities, but rather to push for
their success. In other words the program might have
some chances of partial or marginal success on its
own merit, however, with the provision of incentives
success will be almost guaranteed. There are several
types of incentives targeting utilities, consumers, and
the market.
• Utilities are driven by financial incentives. These come
in different forms including:
1) tariff provision for ROI for energy efficiency
programs,
2) tariff provision for acceptable return on the
overall performance of the utility,
 3) financing the EE program, and
4) sharing the cost savings resulting from
generation and transmission operations
• Consumers look for electricity bill reductions. They will
also be enticed to participate if given tax incentives
or financing mechanisms to purchase EE appliances.
As for the market, tax and custom duty exemptions
form incentives that can drive the effort to promote
EE programs. Performance awards and trade
recognition in relation to EE program’s success can
sometimes have an attraction to the market