In the 1980s and early 1990s, utilities utilized integrated resource planning (IRP) to makeinformed, cost-effective, long-term resource decisions. As utility restructuring proceeded overthe last decade, the role of IRP was diminished as market forces were expected to create the mostefficient resource portfolio. Recent energy shortages, and gas and electric market price volatility,have spawned renewed interest in IRP, especially in the West.In the "new" generation of IRP, we have the ability to reflect on some of the firstgeneration's limitations, particularly in terms of quantifying the energy efficiency resource.Other benefits of energy efficiency such as reduced emissions, local employment increases, andrisk mitigation were generally ignored. Moreover, energy-efficiency impacts were often just"subtracted" from the load forecast based upon marginal or avoided costs, and many industryprofessionals did not view this approach as truly "integrated."This paper discusses these key energy efficiency issues as they relate to new IRP methodsand models. In particular, we focus on model simplicity and multiple decision-making criteria todevelop a multi-dimensional approach to resource portfolio selection.
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