fuel switching

Q. What is the basis for utilities or energy commissions not to except fuel switching from say electric to natural gas or vice versa as a demand side management or energy efficiency project? A: This is a very good question. The argument utilities will make is that the utility incentives are paid based on energy savings above a baseline standard. By merely switching to another fuel, you may not be saving any energy but merely replacing your fuel source. Fuel switching, however, is acceptable if the total fuel resource efficiency is improved as in the case of cogeneration in which a customer generates its own energy and uses rejected heat or hot water from the cogenerator for other purposes. So, the overall energy used by economical cogeneration is typically less than the utility generated power.