SACE’s 2019 energy effectivity annual report exhibits that Southeastern states and utilities proceed to depend on costly, outdated, carbon polluting fossil gas power crops, whereas underinvesting in ample low-value effectivity sources. Duke Energy was once more the clear regional chief, delivering over half of all effectivity financial savings for the Southeast.

Forest Bradley-Wright and Heather Pohnan | January 22, 2020 | Energy Efficiency, Energy Policy, Utilities

Register for the Energy Efficiency in the Southeast 2019 Annual Report webinar: bit.ly/EEReportWeb.

Energy Efficiency is a confirmed clear energy useful resource that has a essential position to play in serving to cut back our area’s persistently excessive energy payments and slicing carbon emissions that worsen the climate disaster, threaten public well being, and harm our surroundings. Electric utility energy efficiency programs offset the want for conventional fossil gas power crops and are key to decreasing utility system prices paid by prospects on their month-to-month electrical payments. Sadly, nevertheless, electrical utilities and regulators in the Southeast persistently underinvest in this ample low-value energy effectivity useful resource. Instead, utilities in our area proceed to depend on costly, outdated fossil gas power crops – together with 53 GW of coal-powered mills – and are even proposing building of recent ones. As a end result, when in comparison with different areas in the US, the Southeast stays at the backside of nationwide effectivity rankings. 

The Southern Alliance for Clean Energy’s (SACE) Energy Efficiency in the Southeast 2019 Annual Report makes use of knowledge collected from 2018 to discover energy effectivity developments, establish insurance policies and practices impacting energy effectivity financial savings for the area, and provide options for implementing this underutilized useful resource. By inspecting utility effectivity program financial savings, our second annual report unveils which of our area’s utilities are value-successfully eliminating pointless energy waste, and that are merely promoting extra power.

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2018 UTILITY HIGHLIGHTS

Just a handful of utility methods make up the majority of energy financial savings in the Southeast. The utility methods displayed under accounted for roughly 99% of energy effectivity financial savings in 2018. To examine and distinction the efficiency of those utilities, SACE collects and analyzes detailed program financial savings knowledge from annual studies and official filings submitted to regulators. By inspecting every utility’s energy effectivity program financial savings as a share (%) of the earlier 12 months’s annual gross sales, it turns into simpler to see how utilities of various sizes view energy effectivity as a useful resource.

The utility methods displayed above accounted for roughly 99% of energy effectivity financial savings in 2018.

So, how did Southeast utilities stack up in 2018?

Duke Energy was once more the clear regional chief and the solely electrical utility to ship annual effectivity financial savings (0.79%) that exceeded the nationwide common (0.71%). This achievement is supported by three key elements:

  1. Favorable insurance policies in the Carolinas 
  2. Company employees and administration management with in depth multi-state expertise
  3. Duke’s willingness to work with energy effectivity advocates to enhance and develop program choices, which is unmatched in the area.

Duke Energy Carolinas, working in North and South Carolina, continues to be the solely utility in the Southeast to exceed one % annual financial savings (1.03%), a symbolic checkpoint on the path towards the larger financial savings ranges achieved by profitable utilities in different components of the nation. Duke Energy Progress (0.86%), additionally working in North and South Carolina, was additionally head-and-shoulders above the subsequent main Southeastern utility energy effectivity chief. State coverage variations meant far decrease financial savings for Duke Energy Florida (0.21%). 

Next in line, Georgia Power (0.48%) and Tampa Electric (0.40%) each exceeded the Southeast regional common (0.31%), however fell in need of the nationwide common (0.71%).

All different main Southeastern utility methods are considerably underperforming. The Tennessee Valley Authority (TVA) continues to drive effectivity financial savings downward for the states and utilities it serves (0.17%), and the Southeast’s largest utility, Florida, Power & Light (FPL), produced a trivial (0.08%) effectivity financial savings for its greater than 4 million prospects. 

POLICY TRENDS

In the Southeast’s most populous state, Florida, the Public Service Commission (PSC) simply accomplished one other 5-12 months cycle of efficiency savings targets for the state’s largest utilities. The Commission rejected utility proposals that will have in impact eradicated most effectivity financial savings targets altogether, as an alternative selecting to retain earlier energy effectivity objectives that proceed to position extremely restrictive constraints on effectivity measures and set very low financial savings necessities. 

Recent coverage and regulatory developments, primarily at the state stage, have an effect on the potential to extend future energy effectivity financial savings. The carbon air pollution discount targets outlined in North Carolina Governor Cooper’s 2018 Executive Order 80 construct on an already robust basis that helps clear energy, and in 2019, Duke Energy announced plans to cut its carbon emissions 50% by 2030 throughout all its firms and concurrently attain internet zero carbon by 2050. Also in 2019, the North Carolina Utilities Commission ordered major changes in how Duke conducts built-in useful resource planning, together with remodeling how effectivity is modeled, requiring current coal to compete towards clear energy, and exhibiting how its useful resource plans might obtain state and company emissions targets. Replacing fossil gas technology to fulfill these emission targets represents a significant alternative for energy effectivity in North Carolina in the coming years. 

In South Carolina, continued political fallout from the failed VC Summer nuclear plant led to important turnover at the Public Service Commission and supplied momentum for new clear energy insurance policies like the Energy Freedom Act, authorized unanimously by the state legislature in 2019. While Duke continues to be the main effectivity driver for South Carolina, the PSC lately authorized a plan to double energy financial savings for Dominion Energy above the ranges beforehand captured by South Carolina Electric & Gas earlier than the company takeover.

Policy challenges nonetheless stay for energy effectivity in each North and South Carolina. For occasion, regardless of big financial savings alternatives in the business and industrial sectors, each states give giant business and industrial prospects an “opt-out.” As a end result, many companies don’t contribute to both the value of nor financial savings from, utility effectivity packages in the Carolinas, which drastically limits the quantity of effectivity financial savings for each states.

HOW EFFICIENCY AND IRP RULES RELATE

Integrated Resource Planning (IRP), or lengthy-time period useful resource planning, may be an essential driver for energy effectivity in many states. During Georgia Power’s 2019 IRP process, management by Chairman Bubba McDonald and the Georgia Public Service Commission led to a 15% bump in required effectivity financial savings for Georgia Power over the subsequent three years and added a requirement that future provide additions should compete with effectivity sources immediately. After a couple of years of comparatively small-scale effectivity packages in Mississippi, the Commission enacted IRP guidelines for the first time in 2019 that included a major concentrate on energy effectivity.

 

By distinction, TVA as soon as pioneered this sort of effectivity useful resource evaluation in the Southeast. Actual efficiency fell far in need of plans and right now, TVA provides no direct effectivity rebate incentives for prospects. In 2019, TVA’s IRP took a major flip for the worse with unrealistic costs and spending caps that steeply diminished TVA’s deliberate future effectivity funding. In impact, TVA now has no total effectivity useful resource technique and offers minimal funding for low-earnings weatherization.

LOW-INCOME ENERGY EFFICIENCY 

Utility energy effectivity packages are key to reasonably priced energy, particularly for households affected by excessive energy payments and struggling  with untenable tradeoffs. These prospects typically need to make robust selections between shopping for fundamental requirements like meals, drugs, and transportation, or paying their energy payments, and continuously danger having their power reduce off. 

Florida presents a stark distinction between utilities that ship robust effectivity financial savings packages for low-earnings prospects and people who don’t. Tampa Electric (TECO) was a standout with a low-earnings Neighborhood Weatherization program that reached greater than 7,000 households in 2018, regardless of having a relatively small buyer base. The a lot bigger Duke Energy Florida served greater than 20,000 prospects with its Neighborhood Energy Savers Program. By comparability, the state’s largest utility, Florida Power & Light, reached simply 2,295 low-earnings households. Adjusted for utility dimension, TECO delivered 50 instances extra and Duke Energy Florida delivered 20 instances extra financial savings for low-earnings prospects than FPL.

Duke in the Carolinas, Georgia Power, and TVA additionally took steps to extend effectivity financial savings for low-earnings prospects in 2019, although the scale of want vastly exceeds what’s at the moment deliberate. Georgia Power is now in the means of growing an on-invoice tariff to finance upfront prices of effectivity enhancements for low-earnings prospects, the first by an investor-owned utility in the Southeast. Duke has been increasing the availability of deeper financial savings measures to help low-earnings prospects to attain higher invoice reductions; and TVA is matching funds raised by native utility firms to supply weatherization for low-earnings households.

DECARBONIZATION

Energy effectivity not solely helps prospects decrease their electrical payments, it additionally removes the must construct costly new fossil gas technology, and facilitates the retirement of outdated, polluting coal and fuel power crops. This is less complicated than ever with new applied sciences that enable prospects to optimize their energy use and maximize carbon emission reductions.

Electrification offers alternatives to decrease utility and transportation prices for customers whereas cutting carbon emissions that drive world climate change. The Energy Efficiency in the Southeast 2019 Annual Report highlights the relationship between energy effectivity, strategic electrification, and decarbonization of the area’s power sector.

Some of the most promising electrification alternatives embody:

  • Switching from fuel to electrical energy for heating, water heaters, stoves, and garments dryers
  • Lowering and optimizing energy use with sensible home equipment, units, and meters
  • Modernizing constructing codes and requirements
  • Shifting away from gasoline vehicles, business transport, and public transportation

Electrification can improve electrical energy demand, but additionally helps to decarbonize our nationwide energy system, since a lot of the power sector is already decrease-emitting than direct fossil gas use, and it’s simpler to shift electrical energy technology to renewable energy sources to additional cut back carbon emissions. Meanwhile, energy effectivity helps offset the extra load created by electrification, thereby decreasing carbon emissions from fossil gas power technology. Together effectivity, electrification, and energy optimization can get rid of large quantities of carbon emissions.

The Southeast has amongst the highest energy payments in the nation and the lowest energy effectivity efficiency – however there’s a clear answer: Before spending buyer {dollars} on costlier power crops, utilities ought to be required to first make investments in all value-efficient energy effectivity and energy optimization. To do in any other case is to pay an excessive amount of.

For a replica of the 2018 report (launched in December 2019) and corresponding blogs highlighting particular person state and utility, click on on the following hyperlinks:

Energy Efficiency in the Southeast 2018 Annual Report

SCE&G at the Crossroads for Energy Efficiency

North Carolina and Duke Energy Far Ahead of Southeast in Energy Efficiency

Does Georgia Power Plan to Increase Its Financially Successful Energy Efficiency Programs?

Florida Power & Light Drags State to Bottom of Efficiency Rankings

#EEinSE2019

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