Development of a Marginal Abatement Cost Curve based on a Natural Gas Conservation Achievable Potential Study

Abstract

The Ontario Energy Board (OEB) has a long history of supporting demand-side management (DSM) programs offered by natural gas distributors. In 2016, the OEB undertook its first Conservation Achievable Potential Study for the province of Ontario comparing lifecycle costs and savings of over 150 natural gas energy efficiency measures in the residential, commercial, and industrial sectors. The study found that DSM programs could achieve a 9% reduction in natural gas usage by 2030 at an average cost of $2/month per residential customer. For twice that dollar amount, a 12% reduction could be achieved; for six times that dollar amount, a reduction of 18%. In 2017, the OEB leveraged the results of the Potential Study to develop a Marginal Abatement Cost Curve (MACC), a tool to assess the cost consequences of utilities’ climate change activities. The MACC methodology transformed Potential Study measures into greenhouse gas abatement options by adding the benefit of avoided carbon costs, and then those options were arranged along a cost spectrum. The most cost-effective abatement options were industrial energy efficiency measures, with an average cost of -$130 to -$139 $/tCO2e; commercial measures had an average cost of -$83 to -$119 $/tCO2e; residential measures, -$97 to $108 $/tCO2e.

Presented By

Valerie Bennett, P.Eng., C.M.V.P., C.E.M.
Project Advisor (Engineer)
Ontario Energy Board

Valerie is a professional engineer with 12 years of experience in the energy sector in Canada, Europe and Asia with a strong focus on managing conservation potential studies and evaluating energy efficiency projects and programs. As part of the Climate Change department at the Ontario Energy Board, she plans and undertakes major energy efficiency and climate change projects, such as the OEB’s 2017 Marginal Abatement Cost Curve, that are used as evidence in regulatory proceedings and to develop climate change policy. Prior to the OEB, Valerie worked at a gas utility supporting the Evaluation, Measurement & Verification (EM&V) of its energy efficiency programs. Before that, as a consultant, Valerie led teams to win and then conduct energy efficiency potential and EM&V studies for major industrial customers and government clients in Canada, Europe, China, and Singapore. She is a Certified Measurement & Verification Professional (CMVP) and a Certified Energy Manager (CEM).