New Report Calls for an End to Business-as-Usual Power Planning

International Rivers
Tuesday, November 12, 2013

Integrated Methodology Puts Energy Efficiency First

Berkeley, California: International Rivers released a new report today that shows how planning for energy efficiency early in the power planning process can help governments to make better choices for society, avoid deadly greenhouse gases, and ultimately make wiser investments. 

An Introduction to Integrated Resources Planning, authored by Chris and Chom Greacen, David von Hippel, and David Bill, argues that conventional methods of calculating low-cost energy options often forecast too high of a demand, usually based on highly optimistic models of economic growth. As a result, conventional energy planning often ignores the social, environmental, and economic costs of projects such as large dams and coal-fired power plants. Sometimes, power planning is influenced by the politics of allocating large infrastructure projects to key constituencies. 

In contrast, Integrated Resources Planning, or IRP, takes an integrated approach to costs and risk. For example, it assigns costs to social and environmental risks, and includes transmission costs before rather than after an energy plant has already been approved. IRP has a strong track record in creating plans that are low-cost, low risk, and with outcomes that minimize environmental and social impacts. 

IRP takes a society-wide perspective by incorporating public participation in meaningful ways. "Including stakeholders at the table early on in the energy planning process actually improves the quality of the plans," states Zachary Hurwitz, International Rivers' Policy Program Coordinator, and editor of the report. 

IRP has close associations with energy efficiency: investing in helping customers to save electricity and reduce waste is typically considerably less expensive than building new power plants and fueling them for decades. Traditionally, large dams have been built to fuel energy-intensive and highly wasteful industries like aluminum amelters. 

The report states that utilities that rigorously implement IRP consistently report good news: there are many opportunities for energy efficiency investments, and IRP can lead to substantially lower customer bills while avoiding the social and environmental disruptions and destruction that accompany new power plant construction and operation. 

Some governments have already employed the methodology towards creating better options. In the U.S., 27 states have written Integrated Resources Planning into statutes in some fashion. 

The electric utility PacificCorp, which serves 1.7 million customers across six states in the Pacific Northwest, has utilized Integrated Resources Planning for years to help meet the electricity needs of its market. 

Some middle-income countries such as South Africa and Brazil have long-term energy plans, but have often been opaque when dealing with public stakeholders. Low-income countries, which have typically relied on development aid from institutions like the World Bank, have an opportunity to get it right before locking themselves into destructive and wasteful energy plans, Hurwitz says. 

In its latest Energy Sector Strategy Paper, the World Bank recognizes the value of Integrated Resources Planning as a method for long-term and regional planning, but in practice, the Bank has yet to regularly implement IRP with borrowers. 

"The goal is to get citizens interested in IRP, to activate their voices, so they can help improve energy planning," stated Hurwitz. "Otherwise, governments will continue to take a business-as-usual approach to energy investments, and we simply can't have that." 

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