Energy efficiency programs have real value

{mosads}
The particular EPA regulation being debated now is called the Cross-State Air Pollution Rule.  It would toughen air pollution standards for electrical generating power plants in 27 states, under the Clean Air Act’s “Good Neighbor” provision. Under the rule as published in August, utilities that shut down coal-fired power plants and make the switch to new natural gas plants will be able to keep some of their emissions allowances, yet those that instead opt to meet their obligations through efficiency programs will lose those allowances.

The Cross-State rule as published would discourage utilities from choosing efficiency programs – the cheapest and cleanest solution – to comply with the pollution standards. That makes no sense.

In the last decade, states have had great success creating incentives for utilities to run efficiency programs. And nationwide, there is enormous potential: in a comprehensive study of the U.S. economy in 2009, McKinsey and Company estimated the U.S. can reduce energy consumption by 23 percent and save families and businesses more than $200 billion on their electrical bills in the next ten years through energy efficiency measures.

And these savings are no longer just hypothetical. My company, Opower, has nearly 60 utility partners across the country, including eight out of ten of the nation’s largest utilities – and we have first-hand experience with how efficiency programs achieve real results.

For example, in Minnesota, where we work with 10 regional utilities, home energy efficiency reports have saved individual customers more than $6 million on their energy bills and more than 107 gigawatts of electricity since 2009. And in Washington State, residents of cities in the C-7 New Energy Partnership (including Bellevue, Issaquah, Kirkland, Mercer Island, Redmond, Renton and Sammamish), together have saved more than $1 million in energy costs since launching a Home Energy Reporting program in October 2010.

Proven utility-driven energy efficiency programs, such as these, are a cheaper, cleaner way to help businesses and families save energy. Yet the current system discourages the adoption of these programs. It’s time to make a change.

Two weeks ago, the House of Representatives voted to completely overturn the EPA’s Cross-State rule – but that bill is unlikely to move forward in the Senate and the EPA is expected to begin implementing the rule next month.

While the Obama Administration recently made some revisions the rule, it remains unclear whether the final will allow efficiency to fully compete with new generation.

The interests of all parties at the table would be served by putting efficiency on a level playing field:
* utilities would have more flexible compliance options and be able to lower their costs;
* environmental advocates would achieve the same emissions reduction goals; and,
* businesses and families would see lower energy bills as the cost of compliance are reduced.

We don’t have to settle for the false choice between growing the economy and cleaning our air. By expanding utility energy efficiency programs, we can dramatically decrease the cost of compliance with the new EPA rules, while ensuring that effective measures are in place to protect the environment and the health of the American public.

Dan Yates is CEO of Opower, an energy efficiency technology firm.