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Cost-effectiveness of energy efficiency investments for high renewable electricity systems

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  • Dranka, Géremi Gilson
  • Ferreira, Paula
  • Vaz, A. Ismael F.

Abstract

Although several studies have recognized the challenges brought about the high integration of Renewable Energy Sources (RES), research has yet to systematically investigate the effects of different levels of Energy Efficiency Measures (EEMs) on power systems with a high share of RES. The primary aim of this paper is to quantitatively evaluate the economic impact of different levels of energy efficiency investments in systems with a high share of RES, based on the case of Brazil. Our review analysis revealed a lack of understanding of how to calculate the Long-term Average Cost of Saved Electricity (LACoSE). Therefore, the methodological contribution of this research also lies in the proposition of a step-by-step procedure to estimate this variable. Findings of this study suggest that EEMs may result in a reduction in the expected new installed capacity between 1.9% and 10.3%, and from 0.4% to 4.3% for the total CO2 emissions (for reductions in the final electricity demand varying from 1% to 5% respectively). This comes with a decrease in the overall system costs between 1.9% and 7.7%. The results provide further support for the hypothesis that the economic impacts of energy efficiency investments and its cost-effectiveness are affected by the share of RES in the power system and these type of measures may provide holistic benefits including not only economic advantages but also environmental and social improvements. The proposed methodology largely extends beyond the case addressed as it may provide valuable lessons for other electricity systems.

Suggested Citation

  • Dranka, Géremi Gilson & Ferreira, Paula & Vaz, A. Ismael F., 2020. "Cost-effectiveness of energy efficiency investments for high renewable electricity systems," Energy, Elsevier, vol. 198(C).
    • Handle: RePEc:eee:energy:v:198:y:2020:i:c:s0360544220303054
    DOI: 10.1016/j.energy.2020.117198
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    2. Gilson Dranka, Géremi & Ferreira, Paula & Vaz, A. Ismael F., 2022. "Co-benefits between energy efficiency and demand-response on renewable-based energy systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 169(C).
    3. Besagni, Giorgio & Premoli Vilà, Lidia & Borgarello, Marco & Trabucchi, Andrea & Merlo, Marco & Rodeschini, Jacopo & Finazzi, Francesco, 2021. "Electrification pathways of the Italian residential sector under socio-demographic constrains: Looking towards 2040," Energy, Elsevier, vol. 217(C).
    4. Géremi Gilson Dranka & Paula Ferreira, 2020. "Electric Vehicles and Biofuels Synergies in the Brazilian Energy System," Energies, MDPI, vol. 13(17), pages 1-22, August.
    5. Jan K. Kazak & Joanna A. Kamińska & Rafał Madej & Marta Bochenkiewicz, 2020. "Where Renewable Energy Sources Funds are Invested? Spatial Analysis of Energy Production Potential and Public Support," Energies, MDPI, vol. 13(21), pages 1-26, October.
    6. Tinta, Abdoulganiour Almame, 2023. "Energy substitution in Africa: Cross-regional differentiation effects," Energy, Elsevier, vol. 263(PA).
    7. Dranka, Géremi Gilson & Ferreira, Paula & Vaz, A. Ismael F., 2021. "A review of co-optimization approaches for operational and planning problems in the energy sector," Applied Energy, Elsevier, vol. 304(C).
    8. Tseng, Ming-Lang & Ardaniah, Viqi & Sujanto, Raditia Yudistira & Fujii, Minoru & Lim, Ming K., 2021. "Multicriteria assessment of renewable energy sources under uncertainty: Barriers to adoption," Technological Forecasting and Social Change, Elsevier, vol. 171(C).
    9. Renato Passaro & Ivana Quinto & Giuseppe Scandurra & Antonio Thomas, 2020. "How Do Energy Use and Climate Change Affect Fast-Start Finance? A Cross-Country Empirical Investigation," Sustainability, MDPI, vol. 12(22), pages 1-23, November.

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