Energy efficiency is often regarded as the fastest and most accessible means to achieve sustainability and reduce energy costs. Using a framework developed from semi-structured interviews of business owners, staff and personnel, this presentation will analyze the relevance of various barriers to energy efficiency experienced by commercial and small industrial businesses across 7 industrial parks in the Upper Peninsula of Michigan. Preliminary analysis indicates that high energy costs in the region pose a significant barrier to business expansion and workforce development. To address this, the presentation will also make specific technical and policy recommendations for regional planners, showing how advancing energy efficiency helps support local economic development and business retention.

1. BARRIERS TO
ENERGY
EFFICIENCY
Presentation by Abhilash Kantamneni
IN COMMERCIAL AND
SMALL INDUSTRIAL BUSINESSES IN THE UPPER PENINSULA

2. Challenges - Diversity in rates, policy &
zoning

3. Active Businesses
Jobs
Industrial Parks
Utility service territories
7
6
70
1,715
Generating Economic Development

5. Active Businesses
Jobs
Industrial Parks
Utility service territories
7
6
70
1,715
Generating Economic Development

6. 1)Analyze the cost and feasibility of implementing
• Solar, Wind, Natural Gas, Retrofitting/Energy
Efficiency, Industrial Waste Recapture, Geothermal,
and Biomass.
2)Recommend policy changes and public investments
3)Suggest improvements to development procedures
4)Determine environmental impacts of implementation
• floodplains, wetlands, endangered species,
sensitive habitats, environmental contamination.
Scope of Work

7. Renewable
Energy Standard
(RES)
10% of all retail
electric sales for all
utilities in MI to come
from renewable
sources
Energy
Optimization
Program (EO)
Authorizes EO
surcharge on monthly
bills to finance
customer Energy
Efficiency upgrades
Net Metering
Program
On site renewable
electric generation
with credits for
monthly excess
generation
7
Challenges - Dynamic legislative landscape

8. 1)Analyze the cost and feasibility of implementing
• Solar, Wind, Natural Gas, Retrofitting/Energy
Efficiency, Industrial Waste Recapture, Geothermal,
and Biomass.
2)Recommend policy changes and public investments
3)Suggest improvements to development procedures
4)Determine environmental impacts of implementation
• floodplains, wetlands, endangered species,
sensitive habitats, environmental contamination.
Scope of Work

9. 1) Snapshot of the energy infrastructure, rates, needs,
challenges and opportunities.
2) Create a business case for energy savings
3) Make policy agnostic recommendations for industrial
park managers, EDC and LUGs
New Scope of Work

10. Barriers to Energy Efficiency in
SME
• Imperfect information
• Transaction costs
• Risk & Uncertainty
• Access to capital
• Bounded rationality
• Split incentives

11. Drivers for Energy Efficiency in SME
• Targeted intervention
• Access to experts
• Management culture
• Internal competency

12. Additional Findings
• Benefits of Municipal
Utilities
• Not all EDOs are created equal
• Not all EO programs are
created equal

13. WE
WPS

14. Recommendations
• Monitor the policy & technical landscape, align
regional objectives with state and federal
goals
• Help SME understand their energy bills & costs
• Create coalitions to leverage economies of
scale for ESCO services
• Work with LUG to create funding tools like PACE
• Assist businesses secure representation on
boards of utilities that lack regulatory

15. Abhilash (Abhi) Kantamneni
akantamn@mtu.edu
www.Abhilash.me
@akantamn
15

16. References
• Cagno, E., & Trianni, A. (2013). Applied Energy
• Schleich, J., & Gruber, E. (2008). Energy
Economics
• Nagesha, N., and Patil Balachandra (2006)
Energy

18. WE
WPS
1. High
demand,
low energy
2. High
demand,
high
energy
3. Low
demand,
low energy
4. Low
demand,
high
energy

19. WE
WPS