Dr. Cho Hae-in (Associate Research Fellow) has made a statement that it is necessary to build up a monitoring/verification system and to prepare a financial compensation plan for ensuring demand management with mid- or long-term energy efficiency improvements, in relation to the “Energy Efficiency Resource Standard (EERS)”. The conventional energy transition policies are mainly focusing on how to increase energy to meet the demand, however, a paradigm is shifted to initiate a new energy consumption structure: low consumption and high efficiency. Korea has been implemented the EERS as a pilot project since 2018.
Conducting a survey and interviews with energy providers with EERS compliance and supervisor agencies responsible for overall management, Dr. Cho analyzed the performance and practical problems of the pilot project. It was found that efficient EERS operation is difficult for both energy providers and supervisor agencies due to the absence of monitoring/verification systems and financial compensation. Consequently, she proposed a framework for monitoring and verification and a financial compensation plan including incentives or investment return facilities.
“We need efforts to find a suitable strategy that can maximize the effectiveness of the current EERS business model by in-depth analysis and benchmarking of overseas successful cases,” explains Dr. Cho. “If energy providers are guaranteed a return on their investment and receive incentives based on performance, and also end consumers directly control and experience energy consumption, there will be a huge synergy effect in the implementation of the EERS project.”
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