US utilities’ energy efficiency sized up

electric utility companies, Massachusetts, Energy efficiencyThe effort and resources that US utilities devote to improving energy efficiency vary widely, according to a new report.

The report, entitled Benchmarking Electric Utility Energy Efficiency Portfolios in the US, shows that while some utilities are leading the way in the field, others still show great room for improvement. The report, published by Ceres, a nonprofit organization focusing on sustainability challenges, and energy and environmental advisors M.J. Bradley and Associates LLC, compared 50 electric utility companies across the US.

Large disparities

According to the report, utilities such as Massachusetts Electric and Narragansett Electric, both National Grid subsidiaries, and Pacific Gas & Electric, invest up to $4.80 per megawatt-hour of retail energy sales in energy efficiency schemes. The report contrasted this investment with that of Texas’ United Electric Coop Service and Alabama Power and Georgia Power, both subsidiaries of Southern Company; in 2009 these latter utilities invested less than $0.10 per megawatt-hour of retail energy sales in energy efficiency schemes – nearly 50 times less than the leading companies.

The report was based on data provided by utilities to the Energy Information Administration.

Ceres said that of the 50 utilities analyzed in the report, the energy savings the companies were able to achieve range from a low of 0.1 percent of retail sales to nearly two percent at the top of the pile. The top ten ranking utilities managed savings of one percent of their annual electricity sales.

Energy efficiency provides multiple benefits, from job creation and energy bill savings to air pollution emission reduction benefits.  This benchmarking report illustrates that while some utilities are aggressively pursuing energy efficiency, other utilities need to ramp up their efforts,” commented Dan Bakal, director of Electric Power Programs at Ceres.

According to the survey, there is a positive correlation between the power of state energy efficiency policy and the level of investment and savings of individual utilities. Ceres said this shows that state policies that remove unintended disincentives are a big driver of utility spending on energy efficiency.

Ralph Cavanagh, Energy Program Co-Director at the Natural Resources Defense Council (NRDC), highlighted the ways in which utilities can confront energy efficiency:

“The three policies necessary for utilities to aggressively implement energy efficiency programs include a commitment to pursue all cost-effective energy savings, decoupling of utilities’ financial health from increases in electricity use, and performance-based financial incentives for utilities to achieve energy efficiency gains.”

The report said many of the utilities analyzed are retiring aging power plants and converting to cleaner energy sources.

Best and worst performers

The top utilities, in terms of energy efficiency programs, included Massachusetts Electric, Narragansett Electric, Pacific Gas & Electric, Southern California Edison, Nevada Power, Idaho Power, Seattle City Light, Salt River Project, and Interstate Power & Light, according to the report. Some of the worst performers included Metropolitan Edison and Ohio Edison (both subsidiaries of First Energy), Georgia Power, Alabama Power and Mississippi Power(Southern Company subsidiaries) and Duke subsidiary Duke Energy Indiana.

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