TEXAS Falling Further Behind in Race for Energy Efficiency

AUSTIN, TX – In the middle of a statewide debate about how to ensure Texas has enough power to meet its needs, the State of Texas is falling behind other major states in utilizing the cheapest and cleanest energy resource – energy efficiency.

According to the 2012 State Energy Efficiency Scorecard, released last week by the American Council for an Energy-Efficient Economy, Texas is lagging by most measures of energy efficiency and retained its ranking as 33rd in the nation, a disappointing result given that in 1999 Texas became the first state in the nation to require its major utilities to run energy efficiency programs. The report looks at building energy codes, utility and public benefit energy efficiency programs, state government initiatives on energy efficiency, appliance and equipment standards, combined heat and power and transportation policies. Leading states included Massachusetts, California, and New York, but other large industrial states like Ohio (22), Pennsylvania (20), Colorado (14) and Michigan (12) ranked well above Texas.

“As the second most populous state in the country, and the leading user and producer of electricity, it is time for our Public Utility Commission (PUC), State Energy Conservation Office (SECO) and our legislature to learn the lessons from other states, and implement those programs and policies that can cost-effectively reduce electricity bills and electricity demand, lower emissions from power plants and grow jobs in Texas,” noted Cyrus Reed, Acting Chapter Director of the Lone Star Chapter of the Sierra Club.

Reed said there were three areas where Texas leaders could immediately take action to improve our energy efficiency resource: utility efficiency programs, state building codes and natural gas efficiency programs.

“Our PUC just adopted a new rule that does raise our energy efficiency goals in 2013 for utilities to either 30% of growth in demand or 0.4% of peak demand, but they have put in such tight cost caps – about $1.20 per month per customer– that some utilities won’t even meet their goals in 2013,” Reed complained. “It is time for the PUC or the Legislature to adjust these caps and raise the goals so utilities have the flexibility to meet and exceed them in 2014.”

While Texas received relatively high marks for having adopting the 2009 International Residential Code for single-family homes and the 2009 International Energy Conservation Code (IECC) for other construction back in 2010, the report noted that ten states had gone beyond 2009 codes, and two states – Maryland and Illinois – have already adopted the 2012 IECC as their minimum code.

“Right now, our Energy Systems Laboratory at Texas A&M has told the State Energy Conservation Office, under the leadership of State Comptroller Susan Combs, that Texas should adopt the 2012 IECC Code as the minimum standard,” noted Reed. “Combs and SECO should do it, because the average new home built under the 2012 standards would save from 10 to 20 percent in energy use compared to the current state standard.”

Finally, Reed noted that unlike other large gas-producing and consuming states, Texas has no requirement that natural gas utilities offer gas efficiency programs.

“The Railroad Commission should work with our gas utilities to offer consumers cost-effective gas efficiency programs like other states – even Oklahoma – have done. When even Oklahoma beats you on gas efficiency, you know you are falling behind.”

Cyrus Reed: Low-cost options vs. blackout scare tactics

The following editorial was originally published 16 September 2012 10:30 PM in the Dallas Morning News

In May, the Electric Reliability Council of Texas said electrical generation resources would be tight again this summer, though probably sufficient, and would really start running low around 2014. Subsequently, the Public Utility Commission raised the maximum amount that electrical generators can charge the public at peak times of demand from $3,000 to $4,500 per megawatt-hour to make sure the juice keeps flowing and investors pour into Texas. Now it is considering raising the price again to $9,000 per megawatt-hour and even adding a California-style “capacity” market where generators would be paid for the capacity to produce energy, even when they aren’t actually producing energy, as a way to ensure sufficient resources.

That’s right: Our appointed commissioners are proposing to raise energy prices on homeowners and businesses and pay generators just in case they are needed in order to change market conditions and encourage new investments. But before authorizing an increase in electricity prices or changing our energy-only market, the PUC and other state leaders should look at quick, low-cost options that lower demand at peak times through energy-efficiency programs, solar power and greener buildings.

During two periods last year — a particularly cold February morning and a couple of hot August afternoons — Texas came close to blackouts because there was barely enough juice in the system to keep our heaters and air conditioners running. Now the average consumer’s electric bill could go up by as much as $40 a month.

Ninety-nine percent of the time, there is plenty of electricity to go around, but the PUC is proposing big, expensive changes for the two or three days a year when there might be a problem. Instead, we should focus on programs that will actually reduce demand at peak times.

First, the PUC and ERCOT should change market rules to allow “demand response” — reducing our energy use at peak times by shifting our energy use — to actually get paid by bidding into the market. Essentially, with some rule changes and new software, ERCOT could actually take bids from commercial and industrial entities and even whole neighborhoods that agree to turn down their use of air conditioning or shift their industrial production at peak time.

Second, the PUC must expand required utility energy-efficiency programs. In 2011, the governor signed a bill that requires the state’s nine investor-owned utilities to promote saving energy through energy-efficiency programs, including measures like rebates for new insulation or efficient air conditioners. Since 1999, efficiency programs sponsored by these utilities have reduced demand by 1,365 megawatts — about the size of a large coal plant. Expanding this extremely successful law will reduce energy use and save money.

Third, Texas should adopt new minimum energy codes for new residential and commercial buildings just as Houston has done. The State Energy Conservation Office is now taking public input on whether the state should increase minimum standards from the current 2009 code to the 2012 codes developed nationally. The Energy Systems Laboratory at Texas A&M has analyzed the new codes, and their analysis shows that an average home built in Texas with updated building codes would save up to 40 percent in total energy use and reduce peak demand by up to 18 percent.

Finally, the PUC should implement a law that has been on the books for seven years now — requiring those serving loads to expand their use of renewable energy from sources other than wind like solar and geothermal by at least 500 megawatts by 2015 and consider setting a larger goal of 3,000 megawatts by 2025. Solar helps meet peak demand because it is exactly at the hottest time of the summer when solar power is most beneficial.

Before the PUC raises the price of everyone’s electricity bills to make it more profitable to build new power plants that we’ll only need a few days per year, let’s instead consider these more cost-effective ways to actually save energy and keep our homes cool over the next two years.

Cyrus Reed is the acting chapter director of the Lone Star Chapter of the Sierra Club and may be contacted at cyrus.reed@sierraclub.org.

Pedernales Electric Cooperative moves forward on new policies on energy efficiency and renewable energy

Pedernales Electric Cooperative, one of the largest and fastest-growing electric cooperatives in the nation, finally officially adopted policies on renewable energy and energy efficiency. Today, the Board of Directors, following a multi-year discussion, approved two resolutions involving the future of their energy choices, making their transition toward a cleaner energy future a little brighter. 

First, the Board adopted a policy stating as their annual goal that the electric cooperative provide services, education and dollars toward energy efficiency, conservation and demand reduction programs designed to reduce growth in demand by 20% each year. While a report released last year by a consultant estimated that setting such a goal would require that PEC spend roughly $4 to $5 million per year on incentives and rebates, Board members and PEC staff emphasized that they would assess the programs each year and look for those that most cost-effecitvely meet and exceed these very reasonable goals. While the goals adopted fell short of the Sierra Club recommendation of setting a goal of at least 30% of growth — the same being met by Investor-owned utilities like AEP and ONCOR –and well short of goals adopted by CPS Energy and Austin Energy, they are indeed a good start toward bringing PEC customers programs designed to save energy and build on the programs already in place at the electric cooperative. 

In addition to the resolution on energy efficiency, the Board of Directors adopted a mandatory goal that the cooperative obtain at least 30 % of its capacity for energy come from renewable resources like wind, geothermal and solar energy. According to the staff, PEC currently obtains about 20% of its capacity from renewable resources, both through its contract with LCRA which includes wind and hydro power, as well as a separate wind contract it has. By adopting the resolution, those types of contracts are likely to increase in the near future, as well as specific programs designed to help get PEC cooperative members to invest in solar technologies on-site. The new PEC goal is more ambitious than the 20% goal established by CPS Energy, the energy provider in San Antonio, though not quite as aggressive as the goal adopted by Austin Energy. 

While the two new policies caused some PEC members to complain either that they went too far, or not far enough, both resolutions will require an annual accounting and analysis, meaning the PEC will be able to adjust the timing and scope of the goals going forward. 

For information about PEC’s current energy savings programs, visit their blog page here. For a copy of the Board resolutions, visit here. 

Cyrus Reed, Acting Chapter Director

Two new developments in the Austin Beyond Coal movement — solar and efficiency

Fresh on the heels of this weekend’s  big, massive BEYOND COAL earthday festivities in Austin, Texas, two new developments this week show in a practical sense how Austin can become one of the largest metropolitan areas to move beyond coal. First, tomorrow at City Council, a resolution sponsored by Councilmembers Spelman and Morrisson would form a nine-member task force to work with Austin Energy on an onsite solar goal and program for 2015 and 2020. A couple of years ago a Generation Task Force recommended that Austin set a 300 MW goal for 2020 for distributed renewable resources like PV solar panels. While the final Generation Plan adopted by Austin Energy and City Council did not include the distributed solar goal, they did say they would study the issue. Tomorrow, City Council will finally take the next step and ask nine experts to come up with a plan. Sierra Club believes it makes a whole lot more sense to spend our money on local solar and energy efficiency jobs and resources than spending $100 million a year just to import thousands of tons of coal and burn it at the dirty coal plant at Fayette. What’s good for Wyoming Coal Mining companies ain’t good for Austin, Texas!

If you are in Austin, consider dropping by City Council tomorrow and signing up in support of the resolution, which is Item 81 on their agenda. Meeting starts at 9:30 AM.

So what’s the second development you ask? Energy efficiency. The Generation Task Force adopted a goal of 800 MW of energy efficiency and demand response by 2020, but also recommended an energy efficiency potential study to see if we could do even more.

This week, Austin Energy released a very preliminary draft study done by Kema, a consultant our of California. The study — called Austin Energy DSM -Market Potential Assessment — (I call it AEDSMMPTA for short) — has lots of graphs and numbers and probably needs some further analysis. But what it says is there is the technical potential to reduce demand from EXISTING buildings by 793 MWs by 2020. Wait, you say — that’ s less than our stated goal by 2020! But you see there are new buildings coming into the Austin Energy service area all the time. And the report says there are about 15 MWs a year of additional energy savings by building those new buildings right. So add all that together and that’s 950 MWs of energy efficiency waiting to be had..

We think with a little work we can state that we can get well beyond 1,000 MWs of demand reduction in Austin, Texas — a pretty great way to get beyond coal, but stakeholders, Austin Energy and the Council will work on the report this summer to come up with a final plan.

How do we get out of coal? 950 or 1,000 MWs of Energy Efficiency and 300 MWs of onsite solar is a pretty good way.

Let’s Roll Beyond Coal in Austin.. Cyrus Reed, Conservation Director, Sierra Club

Sierra Club joins other community groups in opposing current Austin Energy proposal

Yesterday, Sierra Club, Lone Star Chapter, joined many other groups in opposing the current Austin Energy rate proposal as being fundamentally unfair to residential ratepayers and those trying to conserve energy.

See Austin American Statesman Article here

http://www.statesman.com/news/local/proposed-electric-rate-increases-target-poor-could-hamper-1934092.html

“The big problem is the high customer and delivery fee of $25 dollar per month for every residential customer no matter how much energy you use,” stated Lone Star Chapter Conservation Director Cyrus Reed. “It hurts apartment dwellers, those on fixed incomes and low energy users.”

“We want a proposal that is fair and encourages conservation and efficiency and is line with the Generation Resource Plan to move away from coal and toward conservation, efficiency, solar and wind.”

Austin Energy is expected to come back with a final version of its proposal in early December. Stay tuned for more about the rate case at the Austin Beyond Coal website (http://www.sierraclub.org/coal/austin/).