Mass. unveils energy efficiency standards
After a year's worth of haggling with the state's utility companies, Massachusetts officials today unveiled a set of ambitious energy efficiency standards that some say are unequaled in the nation.
To meet the new standards - a 2.4 percent reduction in electricity use across the state, and a 1.15 percent reduction in natural gas use - the state's utilities will invest approximately $2.2 billion in expanding efficiency measures like home energy audits, weatherization, and rebates for home appliances, over three years.
The aim is to triple the number of consumers in Massachusetts who make improvements to their homes to reduce their energy use. The money, much of it expected to go toward incentives for utility customers, will come from a combination of sources: third-party financing, revenue from the state's participation in carbon credit auctions, an existing energy efficiency charge on utilty bills, and a modest increase in rates for customers.
Officials say they expect those costs to be offset by roughly $6 billion in efficiency-related savings over the life of the program. The amount of electricity saved, officials estimate, would be enough to power more than 350,000 households for a year, while the amount of conserved natural gas would be enough to heat 57,000 homes for a year.
Jeremy McDiarmid, an attorney with the nonprofit policy advocacy group Environment Northeast, said the conservation standards put Massachusetts "at the head of the class in terms of cost-effective energy efficiency investments."
Data collected by Environment Northeast shows that, under these standards, Massachusetts will top other states on both efficiency spending and annual savings from reducing energy use.
"The important message is that we're reaching for the potential to both reduce emissions associated with burning fossil fuels and to save money for the consumer in Massachusetts," McDiarmid said.
The conservation effort was prompted by environmental legislation requiring utility companies to invest in efficiency improvements when doing so would cost less than building new power generating facilities.
Energy and Environmental Affairs secretary Ian Bowles cheered the standards, calling them "the next revolution in American energy markets." "Massachusetts will show the nation how to save money for consumers," he said.
Tom King, US operations president of National Grid - one of the largest utilities in Massachusetts - said his company already has done extensive work to analyze energy consumption and expand efficiency programs to help customers manage their costs. He said he views the state's focus on energy efficiency as "one of the most effective investments we can make right now."
King compared the Massachusetts program to similar efforts in California, which many observers consider to be a leader on environmental issues.
"I spent a lot of time in California as CEO of Pacific Gas & Electric, and I think our programs are at that level and are going to exceed it," he said.
Of energy efficiency, King said, "It fundamentally reduces energy consumption year after year.... (And) it's the most effective tool to reduce demand, which is going to reduce bills."
Robert Rio, spokesman for Associated Industries of Massachusetts, said the trade group supports energy efficiency efforts but has concerns about how the state's new standards will affect consumers.
"We're concerned that even though the program is a good program, customers need to be aware that there is a cost to it that will be added to their bills," Rio said, adding that the challenge will be to make sure that energy users take advantage of efficiency rebates and other incentives.
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