In a recently released report, the Sensei Initiative (an EU Horizon 2020 Research and Innovation funded project) reviewed eleven pilots in order to assess challenges and opportunities for expanding P4P energy efficiency in the European Union.

Ten out of these eleven pilots are North American initiatives and many of the highlighted examples are Recurve projects using the open-source CalTRACK Methods and OpenEEmeter that Recurve contributed to the Linux Foundation.

Recurve is excited to see these ideas gain traction not just here in the United States, but also in the EU, UK, Canada, Australia and beyond.

The report emphasizes the importance of exploring P4P approaches for many reasons.

As the electrification of end uses accelerates, with the mass adoption of heat pumps and electric vehicles, and renewable energy sources come to dominate electricity generation, the value of demand-side resources to energy systems will increase substantially. The resources required to ensure electricity system adequacy will be very different, depending on the time of day, the weather, seasonal factors and location …  energy efficient buildings can play a significant role in reducing electricity system costs; but in order to be fully compensated for the services it provides, energy efficiency will need to prove that it is performing.

Given this potential, the report argues, it’s crucial that policymakers begin to explore alternative approaches for delivering efficiency as a resource. 

Piloting performance-based approaches such as P4P applications now will be an important first step in familiarising stakeholders with this concept and assessing whether the approach is appropriate to deliver on the objectives. Policymakers should consider requiring obligated utilities in Energy Efficiency Obligation Schemes (EEOSs) to deliver some of their targets using the P4P approach.

The report notes, however, that in order for P4P to work, programs will need to shift their approach to the calculation of savings:

The P4P approach requires a different form of M&V methodology to most energy efficiency programmes that rely on “deemed savings” estimates. The calculation of savings relies on accurate and timely meter data, and on the modelling of counterfactual energy consumption, i.e., what would have happened without the programme intervention. This implies minimum requirements for the metering infrastructure and a set of detailed specifications for the modelling of the counterfactual.

These calculations should be based on open approaches:              

Critically, supporting efforts around Europe towards open model development, including source code, datasets and detailed documentations, along with suitable open licenses to enable use, modification, and replication, should be distributed through existing public channels.

Recurve is encouraged by the growing enthusiasm in P4P efficiency based on open source methods and code in the United States, Europe and elsewhere, and we believe that embracing this new approach will translate into greater investment and innovation, allowing efficiency to finally take its place as a true grid and energy resource.