### 8

- C

- i APPENDIX 8

- C

. MARGINAL ENERGY PRICE FACTOR CALCULATIONS FOR

FURNACE FAN S

TABLE OF CO NTENTS

8

- C.1 INTRODUCTION

................................ ................................ ................................ ....... 8

- C

- 1

8

- C.2 MARGINAL PRICE FACTO R CALCULATION FOR EL ECTRICITY AND

NATURAL GAS

................................ ................................ ................................ ......... 8

- C

- 1

8

- C.3 RESULTS

................................ ................................ ................................ .................... 8

- C

- 2

LIST OF TABLES

Table 8

- C.3.1 Marginal Electricity Price Factors using RECS 2005 billing data

............ 8

- C

- 2

Table 8

- C.3.2 Marginal Natural Gas Price Factors using RECS 2005 billing data

.......... 8

- C

- 3

Table 8

- C.3.3 Marginal Month ly Electricity Prices for 2010 Using Marginal Price

Factors (2011$/kWh)

................................ ................................ ................. 8

- C

- 4

Table 8

- C.3.4 Marginal Monthly Natural Gas Prices for 2010 Using Marginal Price

Factors (2011$/MMbtu)

................................ ................................ ............. 8

- C

- 5

### 8

- C

- 1 APPENDIX 8

- C. MARGINAL ENERGY PRICE FACTOR CALCULATIONS FOR

FURNACE FAN S

8

- C.1 INTRODUCTION

Marginal energy prices are the prices consumers pay for the last unit of energy used.

DOE used the marginal energy prices for each house for the cost of saved energy associated with

the use of higher

- efficiency e quipment. Since marginal prices reflect a change in a consumer’s

bill associated with a change in energy consumed, such prices are appropriate for determining

energy cost savings associated with possible change to efficiency standards.

EIA provided RECS 2005 billing data that had been gathered from a subset of RECS

housing records. For each household with billing data, the following are provided for each billing

cycle: the start and end date, the electricity consumption in kWh, the electricity cost in do llars,

the natural gas bill in dollars, and the gas consumption in hundreds of cubic feet. This data was

used to determine marginal energy price factors by census division and four large states that are

then used to convert average monthly energy prices into marginal monthly energy prices. Since a

furnace fan operates during both the heating and the cooling season, DOE determined summer

and winter marginal price factors.

For oil

- fired furnaces and boilers, DOE used the average oil prices for each house for

both base case equipment and higher

- efficiency equipment, as the data necessary for estimating

marginal prices were not available. DOE used the same method for LPG

- fired equipment.

8

- C.2 MARGINAL PRICE FACTOR CALCULATION FOR ELEC TRICITY

AND NATURAL GAS

DOE used RECS 2005 billing data provided by EIA to calculate marginal energy prices.

Deriving marginal energy prices by calculating energy bills based on even a detailed knowledge

of a consumer's utility tariff is hampered by the lack of information on items that affect marginal

energy prices but are not normally evident on utility tariffs. Taxes, special fees, and one

- time

surcharges or rebates included in the energy bill are examples of this type of item. Use of RECS

billing data avoids having to estimate th e effect of non

- tariff items on consumer marginal energy

prices.

DOE estimated average and marginal electricity and natural gas prices from the RECS

monthly billing data. Marginal energy prices were calculated with a linear regression of monthly

customer bills to monthly customer energy consumption for each household with billing data

available. Household identifying features such as state, utility service area or zip code were not

reported in the data preventing a localized aggregation. DOE therefore agg regated the energy

prices into the available household identifying features (namely census division and four large

states).

### 8

- C

- 2 DOE interpreted the slope of the regression line for each household as the marginal

energy price for that household. DOE kept the marginal energy prices only for sample housing

records with regression values greater or equal to 85%. The 85% limit was chosen in order to get

a close correlation between the cost and consumption data. A ny higher limit excluded most of

the housing records from the analysis; any lower limit lost the linearity of the relationship

between the seasonal costs and consumption. The slopes of these regression lines are the

estimate of the seasonal marginal prices for that household.

To determine the marginal pri ce factor DOE divided the seasonal marginal and average

electricity price for each household. DOE then aggregated the individual electricity and natural

gas marginal price factors using the RECS household weight s

.

8

- C.3 RESULTS

Table 8

- C.3.1 and Table 8

- C.3.2 show the resulting marginal electricity and natural gas

marginal price factors.

Table 8

- C.3.1 Marginal Electricity Price Factors using RECS 2005 billing data

Census Division and Four

Large States Winter Summer

Division 1 0.68 0.89

Division 2 0.91 0.99

Division 3 0.90 0.93

Division 4 0.91 0.89

Division 5 0.90 0.96

Division 6 0.88 0.95

Division 7 0.70 0.96

Division 8 0.93 0.89

Division 9 0.91 0.91

New York 0.60 0.87

California 0.96 0.96

Texas 0.63 0.97

Florida 0.87 0.90

### 8

- C

- 3 Table 8

- C.3.2 Marginal Natural Gas Price Factors using RECS 2005 billing data

Census Division and Four

Large States Winter Summer

Division 1 0.93 0.86

Division 2 0.96 0.83

Division 3 0.92 0.76

Division 4 0.89 0.70

Division 5 0.89 0.77

Division 6 0.94 0.74

Division 7 0.88 0.85

Division 8 0.87 0.65

Division 9 1.01 0.85

New York 0.85 0.78

California 0.98 0.88

Texas 0.85 0.55

Florida 1.00 0.92



### DOE then applied the marginal price factors to the monthly energy price s in appendix 7

-

B to develop marginal monthly energy prices for 2010 ( Table 8

- C.3.3 and Table 8

- C.3.4 ).

### 8

- C

- 4 Table 8

- C.3.3 Marginal Mon thly Electricity Prices for 2010 Using Marginal Price

Factors (20 1 1 $/kWh)

Geographical Area Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Connecticut, Maine,

New Hampshire, Rhode

Island, Vermont 0.119 0.120 0.121 0.158 0.160 0.161 0.160 0.160 0.160 0.124 0.123 0.122

Massachusetts 0.100 0.101 0.101 0.132 0.134 0.138 0.135 0.136 0.138 0.105 0.102 0.104

New York 0.109 0.110 0.110 0.163 0.167 0.174 0.176 0.176 0.176 0.116 0.114 0.112

New Jersey 0.145 0.146 0.147 0.160 0.165 0.179 0.183 0.183 0.179 0.150 0.150 0.150

Pennsylvania 0.111 0.111 0.113 0.127 0.133 0.139 0.140 0.138 0.136 0.123 0.118 0.114

Illinois 0.094 0.098 0.102 0.111 0.115 0.119 0.119 0.118 0.118 0.115 0.103 0.097

Indiana, Ohio 0.090 0.092 0.095 0.104 0.109 0.110 0.107 0.107 0.108 0.105 0.101 0.094

Michigan 0.113 0.113 0.113 0.117 0.118 0.123 0.124 0.125 0.122 0.114 0.114 0.114

Wisconsin 0.113 0.117 0.116 0.122 0.124 0.125 0.122 0.122 0.123 0.120 0.119 0.116

Iowa, Minnesota, North

Dakota, South Dakota 0.088 0.090 0.091 0.093 0.098 0.102 0.102 0.102 0.099 0.097 0.094 0.091

Kansas, Nebraska 0.079 0.082 0.084 0.087 0.090 0.097 0.097 0.098 0.096 0.090 0.086 0.082

Missouri 0.072 0.073 0.077 0.080 0.091 0.099 0.097 0.097 0.088 0.082 0.080 0.074

Virginia 0.089 0.090 0.093 0.103 0.107 0.111 0.111 0.111 0.109 0.099 0.095 0.091

Delaware, District of

Columbia, Maryland,

West Virginia 0.109 0.110 0.112 0.123 0.133 0.143 0.142 0.142 0.140 0.123 0.117 0.114

Georgia 0.084 0.087 0.089 0.096 0.101 0.108 0.109 0.110 0.105 0.093 0.089 0.084

North Carolina, South

Carolina 0.090 0.092 0.093 0.102 0.103 0.102 0.104 0.104 0.104 0.100 0.097 0.093

Florida 0.101 0.102 0.103 0.108 0.107 0.105 0.106 0.107 0.107 0.103 0.104 0.103

Alabama, Kentucky,

Mississippi 0.082 0.084 0.086 0.098 0.099 0.099 0.098 0.099 0.098 0.091 0.089 0.085

Tennessee 0.081 0.082 0.083 0.092 0.094 0.092 0.091 0.091 0.091 0.087 0.087 0.085

Arkansas, Louisiana,

Oklahoma 0.059 0.061 0.063 0.089 0.091 0.094 0.093 0.094 0.095 0.068 0.064 0.061

Texas 0.068 0.069 0.072 0.115 0.119 0.123 0.123 0.123 0.122 0.078 0.073 0.071

Colorado 0.101 0.102 0.103 0.100 0.104 0.104 0.103 0.103 0.103 0.108 0.106 0.104

Idaho, Montana, Utah,

Wyoming 0.079 0.080 0.080 0.077 0.079 0.081 0.082 0.081 0.081 0.085 0.082 0.081

Arizona 0.091 0.094 0.097 0.097 0.107 0.107 0.105 0.105 0.105 0.110 0.098 0.098

Nevada, New Mexico 0.109 0.112 0.112 0.109 0.108 0.106 0.105 0.106 0.107 0.115 0.115 0.112

California 0.145 0.143 0.143 0.142 0.146 0.149 0.153 0.152 0.146 0.141 0.146 0.149

Oregon, Washington 0.077 0.078 0.078 0.077 0.077 0.078 0.079 0.079 0.080 0.080 0.080 0.080

Alaska 0.144 0.146 0.149 0.152 0.156 0.156 0.158 0.157 0.155 0.154 0.153 0.150

Hawaii 0.255 0.256 0.255 0.258 0.259 0.261 0.265 0.266 0.267 0.271 0.272 0.271

United States 0.110 0.112 0.115 0.118 0.122 0.124 0.125 0.125 0.124 0.122 0.118 0.114

### 8

- C

- 5 Table 8

- C.3.4 Marginal Mon thly Natural Gas Prices for 2010 Using Marginal Price

Factors (20 11 $/ MMbtu )

Geographical Area Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Connecticut, Maine,

New Hampshire, Rhode

Island, Vermont 14.15 14.28 14.37 13.58 14.15 15.24 16.51 16.78 19.01 15.79 15.23 14.78

Massachusetts 13.55 13.66 13.55 12.96 11.77 12.26 13.44 14.17 15.97 12.85 14.22 14.10

New York 11.63 11.43 11.54 11.06 12.19 13.81 14.75 14.53 18.03 13.49 12.27 11.51

New Jersey 11.89 11.84 11.88 10.55 11.29 12.45 12.97 12.94 15.29 13.45 12.49 12.33

Pennsylvania 12.04 12.20 12.37 11.16 12.44 14.06 15.64 15.99 18.26 14.58 13.09 12.43

Illinois 8.93 9.05 8.94 7.80 9.21 10.55 11.13 11.29 13.84 10.28 9.30 8.86

Indiana, Ohio 10.47 10.53 10.72 9.38 10.28 11.66 12.50 12.59 15.65 11.85 10.81 10.62

Michigan 9.66 9.69 9.79 8.47 9.30 10.69 11.81 12.21 14.99 11.52 10.45 10.05

Wisconsin 9.94 9.72 9.81 8.21 8.18 9.24 9.51 9.66 11.90 9.33 10.21 10.00

Iowa, Minnesota, North

Dakota, South Dakota 7.95 7.71 7.75 6.30 7.06 8.20 8.79 9.04 12.15 8.82 8.29 7.99

Kansas, Nebraska 9.25 9.27 9.25 7.83 8.75 10.15 10.78 11.22 15.58 12.12 10.08 9.53

Missouri 11.36 11.37 11.39 9.72 11.25 13.52 15.29 16.18 21.68 16.60 13.37 12.10

Virginia 11.78 11.43 11.12 10.65 12.44 14.44 15.65 15.52 20.07 14.73 12.26 11.83

Delaware, District of

Columbia, Maryland,

West Virginia 11.51 11.47 11.60 10.83 12.12 13.75 14.82 14.85 18.74 13.94 12.40 11.87

Georgia 13.07 13.83 14.34 13.57 16.57 18.41 19.32 19.15 23.37 18.62 14.62 13.75

North Carolina, South

Carolina 13.09 12.97 13.19 12.11 13.78 16.27 17.26 18.01 22.39 16.78 14.32 13.84

Florida 16.17 16.49 17.48 17.04 18.57 19.69 20.26 20.70 22.14 22.05 20.25 17.91

Alabama, Kentucky,

Mississippi 11.60 11.52 11.80 10.13 11.49 12.70 13.03 13.27 17.54 15.20 13.15 12.21

Tennessee 10.79 10.98 10.91 9.14 9.99 11.34 12.03 12.40 16.08 13.91 12.03 11.37

Arkansas, Louisiana,

Oklahoma 10.46 10.40 10.58 11.10 13.20 14.49 15.30 15.73 18.15 14.99 12.79 11.16

Texas 8.81 8.89 9.09 6.59 7.55 8.33 8.56 8.74 15.96 12.32 10.25 9.12

Colorado 6.51 6.58 6.75 5.19 5.67 7.00 7.12 7.57 10.97 7.87 7.07 6.71

Idaho, Montana, Utah,

Wyoming 7.31 7.34 7.49 5.46 5.69 6.13 6.63 6.91 10.02 7.81 7.67 7.47

Arizona 12.22 12.56 12.94 10.49 11.75 12.93 14.01 14.62 21.78 17.93 15.12 13.03

Nevada, New Mexico 8.75 8.94 9.18 7.35 8.32 9.53 9.41 9.79 14.64 11.44 9.76 8.88

California 9.88 9.76 9.37 8.30 8.78 9.22 9.24 9.07 10.18 10.06 9.56 9.68

Oregon, Washington 11.78 11.91 11.99 10.42 10.83 11.40 12.60 13.15 14.92 13.66 12.58 12.21

Alaska 8.76 8.82 8.90 7.62 7.95 8.23 8.87 8.76 9.54 9.13 8.82 9.01

Hawaii 43.36 43.73 43.40 36.91 37.63 37.88 38.72 39.67 46.45 46.74 46.80 46.00

United States 11.25 11.32 11.39 11.90 13.00 14.50 15.33 15.61 14.98 13.07 11.96 11.50