Utilities Increase Energy Efficiency Spending by 43%

U.S. utilities increased their spending on energy efficiency programs by 43% in 2009, according to a new report from the nonprofit Consortium for Energy Efficiency (CEE), which represents energy efficiency program administrators from across the United States and Canada.

U.S. utility spending on energy efficiency programs reached $5.3 billion, including $4.4 billion for electric energy efficiency programs and $930 million for natural gas programs. Spending on natural gas programs increased the most, at 79%, while electric programs increased by 38%.

Electric energy efficiency programs focus a majority of their
spending on commercial and industrial facilities, while natural gas
programs are skewed more toward residential customers.

Utility energy efficiency programs also expanded geographically, as such programs are now offered in 46 states, compared to only 37 states in 2008. The CEE report notes that electric energy efficiency spending grew the fastest in the Southeast and South Central states, with a 76% increase to $800 million in 2009. For instance, new legislation in Maryland increased electric energy efficiency spending by a factor of 13, while Kentucky increased its spending by an order of magnitude and Tennessee’s spending increased by a factor of 5.

Such energy efficiency programs are expected to keep U.S. greenhouse gas (GHG) emissions in check over the next 20 years, but long-term costs have been underestimated, according to Bloomberg New Energy Finance.

Even in the absence of new carbon reduction policies, the market research firm predicts that the United States will exploit readily available residential and industrial efficiency gains to achieve a 2% drop in GHG emissions by 2030. But once those simpler options are used up, the cost for further cuts will rise more steeply than previously thought.

To achieve the Obama Administration’s goal of a 17% cut by 2020 would require more fundamental changes to the power and transport sectors, but costs can still be held to less than $1 per day per U.S. household, according to Bloomberg New Energy Finance. The report calls for new, more aggressive policies by the United States to help speed energy technology improvements and lower the long-term costs of cutting GHG emissions.

Utilities Survey

Despite the popularit of renewable resources like wind and solar, the utilities industry chose nuclear power as its preferred "environmentally friendly" technology in a recent survy conducted by Black & Veatch.

In addition, more than 75% of the 329 executives who participated in the survey said there is a future for coal-fired power plants.

On the up side, 79% and 73% said wind power and solar power projects respectively are underway or planned within the next five years. And a majority said they expect some form of carbon legislation to be in place by 2012, though more than 70% oppose cap-and-trade. 

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