The solution involves a variety of actions to improve energy efficiency and reduce dependence on coal and other fossil fuels.
This has been recognized by China’s leadership, which has established a goal to use efficiency to cut demand by 800 million tons of coal equivalent by 2020, even as China’s economy continues to grow.
One critical way to improve energy efficiency is through the use of “demand side management” (DSM) programs. The value of DSM has been proven; for example, over the past 20 years, DSM programs in California have helped to avoid the need to build an additional 20 new power plants.
DSM involves utility-sponsored programs providing incentives to customers to afford and use energy efficient technologies. Such technologies include: residential appliances and air conditioners; commercial lighting, heating and cooling; and industrial equipment.
The Alliance is working closely with central and provincial decisionmakers in China to help fashion DSM programs that are appropriate for local conditions. In particular, we are helping to identify opportunities for substantial energy savings through efficiency and to develop specific DSM programs that would best capture these opportunities in a way that works effectively with the local utilities. Based on priorities established by Chinese officials, the Alliance initially focuesed only on industrial efficiency. In 2010 the Alliance expanded its mission to include energy efficiency of China’s publicly used buildings.
The Alliance Technical Advisory Group (TAG) is composed of key experts on energy efficiency and China energy issues. Regular meetings of the TAG ensure that Alliance projects are designed to achieve the maximum possible levels of efficiency while accounting for technical, financial, and political parameters.
With the strong support of California officials, and building on the experience gained by utilities in California and elsewhere in the US, the Alliance is well-placed to work cooperatively with Chinese officials to develop successful DSM programs. In fact, the State of California has entered into a cooperative agreement with its sister province (Jiangsu) related to energy efficiency, with the Alliance as an implementing partner.
Commissioners from the California Public Utilities Commission and the California Energy Commission have joined other leading experts as members of the Alliance Leadership Council. Furthermore, all three investor-owned utilities in California have supported the Alliance in order to help share their experience with China.
The work of the Alliance is recognized by leaders in both China and the US (and elsewhere) as providing an extremely valuable contribution to the twin goals of reducing energy demand and improving the global environment. Therefore, key officials from relevant sectors in the US and China have agreed to participate in the Alliance Leadership Council (including Chinese governmental leaders with the influence and authority to implement the necessary changes in laws and regulations).
The Leadership Council is designed to provide guidance and support to the Alliance, specifically with respect to its goals and strategies, as well as its fundraising activities.