Massachusetts Finalizes $2.2B in Energy Efficiency Plans

The Massachusetts Department of Public Utilities (DPU) on Friday gave final approval to plans committing the state’s investor-owned electric and natural gas utilities to $2.2 billion in energy efficiency investments over the next three years.

The Green Communities Act signed into law by Governor Deval Patrick in 2008 required the utilities to prepare energy efficiency plans that secure all available energy efficiency and demand reduction resources that cost less than new energy supply.

"The Green Communities Act established energy efficiency as the Commonwealth’s ‘first fuel’–what we look to first to power our homes and our economy," Secretary Ian Bowles said. "With this DPU action, we are off and running, pulling out all the stops to cut energy waste, save money and reduce greenhouse gas emissions in buildings across Massachusetts."

Funding for the programs will include existing charges on ratepayer bills, carbon allowance auction proceeds from the Regional Greenhouse Gas Initiative (RGGI), regional energy market revenues, and customer contributions.

While utilities are allowed to recoup the cost of efficiency measures through rates (just as they would to pay for new supply), resulting improvements are projected to save participating electric and natural gas customers three times as much in the long run–more than $6 billion over three years, the governor’s office said in a release. The savings would put Massachusetts at the top of the national pack in terms of per capita savings through energy efficiency.

"Today’s decision levels the playing field, putting energy efficiency on equal footing with new energy supply when it comes to powering our economy," DPU Chairman Paul Hibbard said.

"The initiatives launched by these plans are expected to create or maintain nearly 4,000 green jobs in Massachusetts," DOER Commissioner Phil Giudice said. "In the process, we’ll reap unprecedented savings for consumers, spur growth in the clean energy sector and cut greenhouse gas emissions from power plants."

Greenhouse gas reductions attributable to electric and natural gas efficiency steps taken as a result of three-year plans are estimated at 15 million tons over the lifetime of the measures installed.

"The actions taken today by the Massachusetts DPU prove that there is still an enormous reservoir within our state and communities for leading the way toward a clean and efficient, low-carbon energy future," said Kateri Callahan, President of the Alliance to Save Energy. "It is especially significant that when the state’s electric utilities meet their new targets for energy efficiency this will not only slow but actually reverse the historical trend of growing electricity demand."

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