Nation-Leading Energy Efficiency Plans Based On Patrick Administration-Attorney General Coakley Pact Set for Final Review
Ramp-up of energy assessments and investments to provide unprecedented electricity and natural gas savings for consumers, environment, and economy
Final DPU action is due in January on landmark plans unanimously approved last month by the Energy Efficiency Advisory Council, a panel created by the Green Communities Act of 2008 to review utility company energy efficiency targets before their submittal to the DPU. Prior to the Council's October 27 final vote, the panel approved two separate agreements on electric and natural gas efficiency savings brokered by the Patrick Administration and the Attorney General. Council members represent a diverse array of important stakeholders including the Associated Industries of Massachusetts, Environment Northeast, the Utility Workers Union of America, residential energy consumers, and others.
"These plans save people money on their gas and electric bills," said Governor Patrick. "Once again, Massachusetts is leading the nation on bold clean energy solutions."
Once implemented, the plans, which set unparalleled three-year targets for electricity and natural gas savings through a significant ramp up of public utility energy efficiency programs, are expected to create or save nearly 4,000 jobs in Massachusetts and increase the gross state product by $2.4 billion.
"The Energy Efficiency Advisory Council is to be commended for bringing together diverse interests in pursuit of a common and important goal - energy savings that benefit the consumer, the environment, and the Massachusetts economy," Energy and Environmental Affairs Secretary Ian Bowles said. "Once approved and implemented, these plans will cement Massachusetts's position as the country's energy efficiency leader - a distinction that will reap savings for consumers, spur growth in the clean energy industry, and cut greenhouse gas emissions from power plants."
"While these plans will have an upfront cost to consumers, energy efficiency represents a proven investment that will help customers save money and manage their energy consumption in the long-term. We look forward to reviewing each of the individual company plans through the DPU proceedings to ensure conformance to the Green Communities Act and the priorities of the Council," said Attorney General Martha Coakley, who serves as ratepayer advocate in proceedings before the DPU.
The Green Communities Act of 2008 required the state's 13 investor-owned electric and gas utilities (and the Cape Light Compact, which operates efficiency programs on Cape Cod) to prepare energy efficiency plans that will "provide for the acquisition of all available energy efficiency and demand reduction resources that are cost effective or less expensive than supply." The Council's approval of the utilities' efficiency plans came after 25 public meetings and thousands of hours of work by councilors and efficiency program administrators.
Under Council scrutiny since April, the proposed efficiency plans require investor-owned electric and gas utilities to scale up their energy efficiency programs to reach greater numbers of customers and provide them more significant energy savings through improved energy assessments and incentives for investments in high efficiency lighting, appliances, heating and air conditioning, and insulation and air sealing. The plans call for better outreach to and education of energy consumers about the availability and benefits of energy efficiency programs, including outreach that is multicultural and multilingual, community-based, and geared toward new markets such as small family-owned businesses.
On the electric side - the agreement on which was announced October 7 - the efficiency plans set an energy savings target of 2.4 percent of electricity sales in 2012, which would reverse the overall electricity usage trend from growing roughly 1 percent per year to declining 1.4 percent per year. Previous electric utility energy efficiency programs have produced savings of 0.8 percent to 0.9 percent annually. Energy efficiency investments to reach the 2012 target will save 2,648 gigawatt-hours of electricity - enough to power more than 350,000 households, or 15 percent of the utilities' residential customers, for one year. With electricity savings of 2.4 percent per year going forward, Massachusetts would meet 30 percent of its electricity needs through improved energy efficiency, rather than additional power generation, by 2020.
Funded over three years with $1.6 billion from distribution charges on electricity bills, the proceeds of Regional Greenhouse Gas Initiative allowance auctions and third-party capital, the electric energy efficiency plans are expected to lock in energy savings of over $5 billion.
A similar set of natural gas plans developed and approved by the Energy Efficiency Advisory Council target equally aggressive energy savings. Costing $480 million over three years, natural gas efficiency programs are expected to produce total energy cost savings of $1.18 billion for consumers over the lifetime of efficiency measures installed. The natural gas efficiency plans set an energy savings target of 1.15 percent of natural gas sales in 2012, with aggregate savings over three years of 57 million therms.
"This is an opportunity for Massachusetts to be a showcase for the nation - and the world - on how to reduce energy waste while growing our economy," Department of Energy Resources Commissioner Phil Giudice said. "I applaud the work of the Council in brokering these landmark savings agreements and look forward to final action by the DPU early next year."
The utility plans were filed with the DPU received on October 30 and, by statute, must be acted upon within 90 days. The first step in the process is a public hearing on all of the plans, scheduled for November 30, followed by evidentiary hearings December 1 through 11. Following the submission of briefs and further deliberation, the DPU's final orders will be issued on January 28.