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California has developed a comprehensive statewide program to
reduce greenhouse gas (GHG) emissions. The state is rightly
recognized as global leader in the effort to combat climate change.
As the Scoping Plan Concept Paper recognizes, however, greater
effort and innovation is needed to meet future GHG reduction goals
to avoid the worst impacts of climate change. 
Governor Brown has identified the built environment as one of the
key “pillars” for additional action
(http://www.arb.ca.gov/html/fact_sheets/2030_energyefficiency.pdf).
A doubling of energy savings from efficiency measures in buildings
is called for over the next fifteen years. While challenging, these
savings can be realized if California adopts new or modifies
existing policies that more fully incentivize deployment of energy
efficiency in the built environment. 

Third-Party Delivered Energy Efficiency (TPDEE) is a key tool that
California can more broadly utilize as part of these efforts. 
TPDEE includes all forms of energy efficiency projects other than
utility- or ratepayer-funded projects. TPDEE projects comprise the
majority of efficiency projects conducted in non-residential
buildings.  Government facilities, schools, universities,
hospitals, public housing, industrial facilities and commercial
buildings are generally better addressed through TPDEE strategies,
and are most often implemented either by an energy service company
(ESCO) or by the facility owner or operator. 

TPDEE approaches and projects deliver customized, turnkey energy
conservation solutions financed by cost savings. These private
sector-financed projects complement traditional utility-led EE
programs and ensure quantifiable GHG reductions. These projects
require no ratepayer of taxpayer funding; strengthen state
industrial competitiveness; and create quality jobs in the
construction and energy sectors. 
Many states are effectively utilizing TPDEE projects to achieve
significant energy efficiency savings. Under the Bush and Obama
Administrations, the federal government has pursued significant
TPDEE investment in its own facilities. Additionally, the Final
Clean Power Plan included TPDEE approaches as a clear option for
states to employ to achieve compliance with the rule. 

While California is a usually a leader in energy efficiency
efforts, it has not capitalized on maximizing efficiency in
non-residential buildings as other states have done. For example,
nationwide, efficiency investments made through the TPDEE tool
known as Performance Contracts (PC) are roughly equal to the
efficiency investments made through utility- or ratepayer-funded
projects. Yet, in California, the only PC projects implemented are
on federal sites such as military facilities. In fact, California
ranks 35th, trailing states such as Alabama and Rhode Island, in
terms of PC-driven efficiency. 

Additional information is attached regarding the role additional
TPDEE could play in California’s efforts maximize savings from
energy efficiency and to achieve significant reductions in GHG
emissions. Our coalition looks forward to working with policymakers
in California and at the Air Resources Board to maximize these
opportunities.