If codes and requirements are making us extra environment friendly, do utilities have to proceed to spend money on energy effectivity? Yes! Read on to see why.

Maggie Shober | September 5, 2019 | Energy Efficiency, Energy Policy

Last month I acquired a query from my mother that stood out as a result of it’s a query I get loads each from of us working within the business and individuals questioning about what we do right here at SACE. The query at a excessive degree is: if energy demand is flat or declining, why will we nonetheless have to spend money on energy effectivity?

I’ve included the unique electronic mail and my response pasted under. Hope you discover this useful!

The falling energy demand + nonetheless needing energy effectivity measures is an effective query and one I get requested loads even from of us “in the know.” The query is murky these days as a result of some utilities have been muddying the waters about completely different sorts of energy financial savings by claiming the necessity for utility energy effectivity applications shouldn’t be there as a result of enhancements in codes and effectivity requirements have labored so effectively. It is true that codes and requirements are bettering general effectivity, however it isn’t true that that success negates the necessity for utility energy effectivity applications.

Falling load is pushed by three principal components outdoors of utilities investing in energy effectivity:

  1. General divergence of economic growth’s relationship with energy use (the way in which the financial system is rising doesn’t essentially use extra electrical energy prefer it has prior to now).
  2. Efficiency standards by DOE on home equipment and gear have been mentioning the effectivity of the least-environment friendly fashions. This influence has taken a very long time to have an effect as a result of individuals and companies don’t purchase new home equipment yearly and the requirements have steadily gotten extra strict.
  3. Improvements in building codes have made a distinction too, however as you recognize as soon as a code is up to date all of the buildings don’t robotically meet that code, in order that takes time as effectively.

Energy efficiency programs paid directly by utilities, nonetheless, are primarily pushed by economics. They are typically put in place the place algorithms tells us that it’s cheaper to incentivize a buyer to make use of lower than to buy that power for them or construct a brand new power plant. The method I clarify this to of us is utilizing an instance of shopping for a fridge. When most folk have to purchase a brand new fridge, they aren’t taking a look at energy consumption, and are seemingly on a decent price range so let’s say they choose for the most affordable mannequin that can also be in all probability the least environment friendly. Over time, the DOE normal for fridges has improved the minimal effectivity of that mannequin, nevertheless it nonetheless isn’t probably the most environment friendly possibility. While modifications in equipment requirements merely elevate minimal effectivity ranges, utility effectivity applications incentivize individuals to pick larger effectivity choices.

A utility effectivity program may give a buyer a $500 rebate for shopping for a extra environment friendly fridge  that prices $1,000 greater than the most affordable. As a end result, the client saves on their electrical invoice with out having to entrance the total $1,000 distinction in price, the utility should buy much less power or construct much less era and thus keep away from elevating charges, and all people wins. (Check out this website from Energy Star to look for rebates out there in your zip code.)

Some utility effectivity applications are for ethical causes as an alternative of economics, i.e. low-income weatherization for houses to assist decrease payments the place there’s actually poor housing inventory just like the Share the Pennies program in Memphis, Tennessee. But most utility energy effectivity funding is strictly an financial choice.

So, falling or stagnant demand doesn’t negate the necessity for these applications to decrease utility prices for all prospects.

Hopefully this helps clarify a little bit higher what we’re engaged on right here at SACE. Visit our website to study extra about energy effectivity and what SACE is doing to advertise good insurance policies and applications that profit all electrical prospects in our area.


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