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The Case for the PEER Power Supply Performance Index

The Power Supply Performance Index (PSPI) is based on the Energy Efficiency and Environment category of the Performance Excellence in Electricity Renewal (PEER™) system. This index provides customers and stakeholders with a useful tool for evaluating and improving power supply performance. Power users, policy makers, and power suppliers can use this rating system to make more informed evaluations of performance and provide a better case for investment. In addition, by extending this program to specific electricity supply organizations, customers can make more informed choices about their energy supply.

Green Business Certification Inc. (GBCI®) believes that recognizing power users, microgrids, and power suppliers with outstanding performance and innovation in electricity design and operation will lead to better procurement, design, and policy choices. This performance transparency – similar to buying a product with an Energy Star label – will make it easier for customers to differentiate among the wide array of power mixes being offered by power suppliers.

In the past, the measure of performance was focused largely on increasing renewable generation. While renewable generation is crucial to sustainability, it alone does not give a complete picture of the environmental impact of the power generation performance.

Shifting the focus to key performance outcomes can lead to more informed choices and dramatically improved performance through procurement, design, and policy choices. Comprehensive metrics are the first step in a strategic process that leads to smarter, more directed improvements.

In today’s power markets, electricity generators and electricity suppliers must have a contract with a customer, utility, or system operator to put power into the grid (see figure below). As a result, customers can and have asked power suppliers to disclose performance data for the power put into the grid by their supplier per the customer contract. 

For many customers, the local utility has the authority to handle this contract and provide power to the grid on their behalf. In restructured markets, however, customers have the opportunity to contract with suppliers that ostensibly put cleaner and more efficient generation into the grid. In the current environment, making this decision can be difficult and arbitrary as there is no standard data available for customers to evaluate their options.

The state of California and many larger customers have begun to require greater transparency regarding the content of the power supplied to the grid on their behalf.[1] The CA Power Content Label requires suppliers to describe “the sources of electricity that are put into the power grid. Each electricity supplier must display information about the energy resources represented by their contracts with electricity generators.”

The PEER rating system developed a set of performance metrics that are used to assess electricity suppliers in areas of clean energy, energy efficiency, and environmental impacts. The following six criteria represent frequently used and commonly available data:

  • Source Energy Intensity (SEI) in MMBtu per MWh
  • Carbon Dioxide Intensity (CO2I) in lbs. per MWh
  • Sulfur Dioxide Intensity (SO2I) in lbs. per MWh
  • Nitrogen Oxide Intensity (NOxI) in lbs. per MWh
  • Water Consumption in gallons per MWh
  • Percent of Solid Waste Recycled

Each state is assessed based on the generation within its state boundaries using the most recent available data from 2014[2]. Each state is awarded a score between 0 and 100 equal to the weighted performance in six criteria. Performance scores range from 17 for Kentucky to 93 for Washington. The complete scoring for all 50 states as well as the full text of the latest Power Supply Performance Report is available in Resources at peer.gbci.org.

Many of the high performing states supply a majority of power from locally available renewables, specifically hydro-powered sources. The following map provides an overview of the ranges of performance across the United States, with the top five states highlighted.

A few states with substantial renewable generation only have average to poor overall performance. This is due to the poor performance of the other generation sources in their generation portfolio. These states (see table below) should consider the environmental impacts of their entire generation portfolio while progressing towards renewable power goals.

A few leading electricity suppliers provide environmental performance information in their annual reports. – for example, NextEra Energy Resources and Calpine.[1],[2] These suppliers prioritize efficient and clean generation as a key business driver. The microgrid and supplier scorecard in Table 2 provides a performance summary of the six key criteria and PEER PSPI. The United States average data is included for comparison.

Customers in restructured markets can use PEER performance metrics to evaluate the energy efficiency and environmental impact of their supplier and to develop procurement specifications seeking contracts with cleaner competitors. In markets that are not restructured, customers can leverage the PSPI metrics to motivate policy makers to work with utilities to supply cleaner, more efficient generation. Customers in all markets can pursue local, clean generation to supplement procured generation.

[1] The California Energy Commission (2009). California’s Power Content Label: Legislation AB 162 and Senate Bill 1305. Retrieved from: http://www.energy.ca.gov/sb1305/power_content_label.html 

[2] U.S. Energy Information Agency. https://www.eia.gov/electricity/data/state

[3] Calpine 2015 Annual Report and Calpine – Powering a Clean, Low-Carbon Future.
Retrieved from: http://s2.q4cdn.com/469362763/files/doc_financials/2015/2015-Annual-Report.pdf and http://www.calpine.com/media/Climate_Change.pdf

[4] NextEra Energy Annual Report 2015. Retrieved from: http://www.nexteraenergy.com/pdf/annual.pdf

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