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Barriers To Energy Efficiency in Industrial Parks

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Energy efficiency is often regarded as the fastest and most
accessible means to achieve sustainability and reduce energy
costs. Using a framework developed from semi-structured
interviews of business owners, staff and personnel, this
presentation will analyze the relevance of various barriers to
energy efficiency experienced by commercial and small
industrial businesses across 7 industrial parks in the Upper
Peninsula of Michigan.
Preliminary analysis indicates that high energy costs in the
region pose a significant barrier to business expansion and
workforce development. To address this, the presentation will
also make specific technical and policy recommendations for
regional planners, showing how advancing energy efficiency
helps support local economic development and business
retention.

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Barriers To Energy Efficiency in Industrial Parks

  1. 1. BARRIERS TO ENERGY EFFICIENCY Presentation by Abhilash Kantamneni IN COMMERCIAL AND SMALL INDUSTRIAL BUSINESSES IN THE UPPER PENINSULA
  2. 2. Challenges - Diversity in rates, policy & zoning
  3. 3. Active Businesses Jobs Industrial Parks Utility service territories 7 6 70 1,715 Generating Economic Development
  4. 4. Active Businesses Jobs Industrial Parks Utility service territories 7 6 70 1,715 Generating Economic Development
  5. 5. 1)Analyze the cost and feasibility of implementing • Solar, Wind, Natural Gas, Retrofitting/Energy Efficiency, Industrial Waste Recapture, Geothermal, and Biomass. 2)Recommend policy changes and public investments 3)Suggest improvements to development procedures 4)Determine environmental impacts of implementation • floodplains, wetlands, endangered species, sensitive habitats, environmental contamination. Scope of Work
  6. 6. Renewable Energy Standard (RES) 10% of all retail electric sales for all utilities in MI to come from renewable sources Energy Optimization Program (EO) Authorizes EO surcharge on monthly bills to finance customer Energy Efficiency upgrades Net Metering Program On site renewable electric generation with credits for monthly excess generation 7 Challenges - Dynamic legislative landscape
  7. 7. 1)Analyze the cost and feasibility of implementing • Solar, Wind, Natural Gas, Retrofitting/Energy Efficiency, Industrial Waste Recapture, Geothermal, and Biomass. 2)Recommend policy changes and public investments 3)Suggest improvements to development procedures 4)Determine environmental impacts of implementation • floodplains, wetlands, endangered species, sensitive habitats, environmental contamination. Scope of Work
  8. 8. 1) Snapshot of the energy infrastructure, rates, needs, challenges and opportunities. 2) Create a business case for energy savings 3) Make policy agnostic recommendations for industrial park managers, EDC and LUGs New Scope of Work
  9. 9. Barriers to Energy Efficiency in SME • Imperfect information • Transaction costs • Risk & Uncertainty • Access to capital • Bounded rationality • Split incentives
  10. 10. Drivers for Energy Efficiency in SME • Targeted intervention • Access to experts • Management culture • Internal competency
  11. 11. Additional Findings • Benefits of Municipal Utilities • Not all EDOs are created equal • Not all EO programs are created equal
  12. 12. WE WPS
  13. 13. Recommendations • Monitor the policy & technical landscape, align regional objectives with state and federal goals • Help SME understand their energy bills & costs • Create coalitions to leverage economies of scale for ESCO services • Work with LUG to create funding tools like PACE • Assist businesses secure representation on boards of utilities that lack regulatory
  14. 14. Abhilash (Abhi) Kantamneni akantamn@mtu.edu www.Abhilash.me @akantamn 15
  15. 15. References • Cagno, E., & Trianni, A. (2013). Applied Energy • Schleich, J., & Gruber, E. (2008). Energy Economics • Nagesha, N., and Patil Balachandra (2006) Energy
  16. 16. WE WPS 1. High demand, low energy 2. High demand, high energy 3. Low demand, low energy 4. Low demand, high energy
  17. 17. WE WPS

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