Energy Efficiency: The Cleanest, Cheapest Energy Resource
SELC, partners push for open dialogue around energy efficiency in Alabama More »
A rate increase proposed by Huntsville Utilities, a municipally-owned utility in northern Alabama, has spurred discussions around the importance of making energy efficiency programs more widely available in a state where efficiency policies have not been widespread.
Last night, the Huntsville City Council approved the 2.75% rate increase for all of the utility’s 182,000 customers, which will add an estimated $4.00 to an average family’s monthly bill once it goes into effect in February. Huntsville Utilities has asserted the increase is necessary to keep up with rising operating costs and energy demands from the growing community it serves.
After the hike was proposed earlier this month, SELC and partner Energy Alabama have advocated for the utility to offset the rate increase by investing in robust energy efficiency programs and making clean energy more accessible for all customers.
Following the City Council’s denial of a proposed rate increase in April 2016, Huntsville Utilities was asked to go back to the drawing board and create a new plan for all rate classes that adequately accounts for impacts to low-income ratepayers.
Utility representatives say the new plan achieves that goal, and that customers seeking to reduce their bills can and should be looking to also reduce their consumption. SELC and Energy Alabama are working to raise awareness and understanding of the myriad benefits energy efficiency provides.
“As the cleanest, cheapest energy resource, energy efficiency must be included as part of the conversation for meeting energy demands in Alabama,” said Keith Johnston, Managing Attorney for SELC’s Birmingham office. “Not only can these programs help customers struggling to pay their bills, the benefits of lowering carbon emissions and other air pollutants while creating local jobs extend across the board.”
The American Council for an Energy-Efficient Economy ranked Alabama 39th in the 2016 State Energy Efficiency Scorecard, rising two positions in the rankings compared to 2015. With some of the lowest electricity program budgets in the country, the report states that Alabamians generally do not have access to a variety of energy efficiency services, and that the state should seek new utility business models that encourage customer energy efficiency.
“A major first step in moving the needle and opening access to energy efficiency is to start an open dialogue with utilities and make the case for financial models that remove disincentives and encourage customers to save energy,” said Daniel Tait, CEO of Energy Alabama. “We are hopeful that the Huntsville City Council members heard the message, and we look forward to future discussions with Huntsville Utilities to establish a robust, transparent process that includes all stakeholders going forward.”
Energy efficiency is the cleanest, cheapest energy resource. Efficiency helps lower customer bills, reduces emissions of carbon and other air pollutants, and creates jobs. Yet despite these proven benefits, the energy efficiency efforts of electric utilities in the Southeast lag behind those of utilities in other regions.
To help bring the benefits of energy efficiency to our region, SELC is pursuing an aggressive strategy to spur utilities to save more energy through efficiency programs, such as incentives to upgrade lighting, heating and cooling systems so that customers can meet their power needs with less electricity. Our strategy to help the Southeast transition to a cleaner energy future includes promoting energy efficiency for the many benefits it offers, making the business case for efficiency to utilities and their regulators, and working with utilities to create financial models that remove disincentives and provide incentives that encourage customers to save energy.
Our work in the Carolinas has helped push the nation’s largest utility, Duke Energy, to roll out its “Save-A-Watt” program, the first large-scale portfolio of energy efficiency programs in the region, and emerge as the energy efficiency leader in the Southeast. We are making headway with other utilities and in other states, as well. In Tennessee, our advocacy helped prod the Tennessee Valley Authority to take a big step forward by treating energy efficiency as a resource that competes directly with natural gas and coal. Because TVA is not regulated by a state utility commission, we are engaging directly with TVA, local power companies and end-use customers to advocate for smart program design, rate structures and other policies that will reduce customers’ electric bills, prevent unwise capital investments, and cut carbon pollution. In Georgia, we have secured commitments from the state’s largest utility, Georgia Power Company, to develop new and better programs to serve low-income customers, including those residing in multi-family housing. This will bring energy saving benefits to historically underserved communities for whom energy costs can be a significant burden.
But there is still much work to be done. In Virginia, we will continue to promote the benefits of efficiency in our work before state regulators and with Dominion Power and Appalachian Power. In Georgia, we will continue to play a prominent role in the Public Service Commission’s Demand Side Management Working Group to push Georgia Power toward higher levels of annual energy savings. And in Alabama, where progress on efficiency has been hampered by a lack of formal proceedings, we will continue to look for ways to make the case for sensible energy efficiency measures that help customers save money.
Across the region, we are engaging with electric cooperatives and municipal utilities, which provide power for up to half the customers in some of our states and serve many low- and moderate-income households. To bring the benefits of energy efficiency to these southerners, SELC is coordinating with its partners to advocate for on-bill financing programs and other measures that allow customers to avoid the up-front cost of major efficiency upgrades, such as new heating and cooling equipment. SELC is also weighing in at the national level on the EPA’s Clean Power Plan, bringing our regional perspective to advocacy for greater reliance on low-cost energy efficiency as a keystone in state strategies to reduce carbon pollution from power plants.
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