Across the country, signs of a cleaner, more efficient, and more affordable U.S. energy system are emerging. But we can’t reach the clean energy future without updating the way utilities make money. Today, utilities earn revenue based on how much electricity they deliver. Companies earn less when they sell less electricity, so they have little incentive to provide energy efficiency programs for their customers.
To address this issue, the Pennsylvania Public Utilities Commission is considering changing how utilities are paid for the electricity they sell. The goal – determining whether new rate plans could eliminate the barriers to energy efficiency programs – is an admirable step toward the clean energy future. Environmental Defense Fund (EDF) has a number of ideas on how to design a more efficient grid, which we filed in comments today:
- Performance-based regulation – Utilities have few incentives to help people adopt solar panels or energy efficiency, so the Commission should implement performance-based regulation plans. Rather than encouraging the sale of more electricity, a performance-based framework would reward utilities for meeting goals that benefit customers and the environment, like encouraging the use of rooftop solar or increasing the use of energy efficiency programs.
What do Farmington, NM, Oklahoma City, Lakewood, CO and Dickinson, ND have in common? These cities are in the heart of oil and gas country, and – most importantly – were locations in which the BLM heard overwhelming support for strong efforts to reduce wasteful venting, flaring and leaks from the oil and gas industry at a series of public meetings in recent weeks.
Methane is a potent climate pollutant and the main constituent of natural gas, so when oil and gas companies on public land allow methane to be leaked, burned or vented to the atmosphere, it not only impacts air quality and our climate, it also represents an economic loss to taxpayers.
Individually at each hearing, and collectively across all four, voices supporting strong BLM methane waste and pollution rules far outweighed the opposition. In the final tally, supportive statements outnumbered negative ones by more than three-to-one. This fits with recent polling that found that a bipartisan majority (fully 80 percent) of Westerners support commonsense rules to cut oil and gas waste on BLM managed lands. Read More
Most Americans think their electricity comes from large power companies. In North Carolina, my home state, that might mean Duke Energy or Dominion Resources. But did you know that 42 million people in 47 states get their electricity from electric cooperatives? These member-owned electric utilities were first formed back in the 1930s to provide electricity to people living in rural areas and small towns.
Today, there are more than 900 not-for-profit electric cooperatives. Their mission remains the same today as it did back then: deliver safe, reliable, and affordable electricity to rural families and businesses.
In rural areas, housing and commercial buildings tend to be older and less energy efficient, increasing energy bills. Often energy efficiency improvements, such as insulation, are overlooked when residents are faced with hard decisions about where to spend money.
Plus, qualifying for a loan to finance efficiency improvements is more difficult in economically distressed rural areas. Addressing this reality poses a significant challenge for electric cooperatives, which serve 93 percent of the nation’s persistent-poverty counties, according to the National Rural Electric Cooperative Association. Read More
New York is on the path to transforming its electric industry. Since the Reforming the Energy Vision (REV) proceedings kicked off with the goal of creating a more robust and efficient electric grid, the State is now a step closer in the quest to reduce greenhouse gas emissions by 40 percent from 1990 levels. And, thanks to the New York Public Service Commission (PSC), the road is looking a lot smoother.
Last month, the PSC rolled out the Benefit Cost Analysis Order, a methodology for how electric utilities should weigh the costs and benefits of proposed investments that affect the grid. With this new order, utilities will be required to calculate the net benefits associated with portfolios of distributed energy investments, such as rooftop solar and energy storage, and compare them with traditional utility investments, like substations, power lines, and poles.
This decision is crucial for New York’s clean energy future because utilities must now value the environmental benefits of distributed energy sources, and quantify how these different alternatives can work together to create a cost-effective, resilient grid. For example, in the face of severe congestion on the grid, utilities could expand the electric system to meet growing demand. Alternatively, they could incentivize a number of different distributed resources to help bring demand down by, for instance, encouraging customers to install solar panels, participate in demand response programs, or invest in energy efficiency to avoid a grid expansion. Read More
New York’s environmental and utility regulators are moving closer to a unified approach to building a cleaner, more robust, and affordable energy system.
The Public Service Commission (PSC), New York’s utility regulator, has been working to rethink how New York makes, moves, and uses electricity through its innovative Reforming the Energy Vision (REV) initiative. Specifically, it has been steering utilities toward a more decentralized electric grid, one that relies more heavily on distributed energy resources. These resources may be clean (such as energy efficiency or solar rooftops) but they may also be dirty (such as older diesel generators). While REV aims to encourage carbon emissions reductions, there is a risk that the initiative could cause environmental harm by driving adoption of dirty distributed energy resources. Getting environmental rules in place before REV becomes a driver of these types of emissions is a matter of real urgency. Read More
Companies today employ a wide array of energy reduction strategies, including energy efficiency, renewable energy, and the utilization of data management systems. But how can companies simultaneously improve these distinct facets of energy management and ultimately scale them? Increasingly, companies that show excellence in comprehensive, strategic energy management are able to employ both top-down and bottom-up management approaches, and infuse data into all levels of their work. This approach to driving progress has proven successful in many corporate energy management programs and is responsible for an increasing number of gains in the space over the last few years.
When it comes to energy efficiency, companies often take a bottom-up approach to establishing their programs. Despite being a clear win-win for a company’s bottom line and the environment, energy efficiency is fraught with challenges that make implementation at scale challenging. It is highly technical in nature, has dispersed ownership among many stakeholders, often relies on large capital outlays, and is generally considered outside the core business of most companies. Because of these barriers and others, energy managers often have to demonstrate the value of energy efficiency projects through small initiatives before receiving the support necessary to scale up their work. While this approach may be frustrating to energy managers who innately understand the potential of their projects to generate large-scale reductions, time and time again it has proven to be an effective catalyst for increased energy efficiency adoption down the road. Read More