By Diane Brown | Thoughts on Innovation
When family and friends gather over the holiday season, energy efficiency isn’t typically a hot topic. Perhaps this year it should be.
With conversations likely to include affordability, notably the increased cost of groceries, gas, and everyday products, energy efficiency provides more than talk. Energy efficiency programs via utility offerings, such as smart thermostats and more efficient A/C units, help combat rising electricity costs and reduce the need to build capital-intensive power plants — saving ratepayers energy and money, year after year after year.
Whether the energy and cost-saving programs continue to provide substantial financial benefits for ratepayers is in the hands of the Arizona Corporation Commission. In early December, the Commissioners will be faced with deciding whether to support APS’ proposed energy and cost-saving programs. And soon after, action is expected on Arizona’s very successful Energy Efficiency Resource Standard. The Commission should extend and expand Arizona’s Energy Efficiency Standard and approve APS’ Demand-Side Management Plan, which incorporates energy efficiency and demand response programs.
Arizona’s Energy Efficiency Standard
Since the inception of Arizona’s Energy Efficiency Standard, over 2,000 MWs in cumulative peak demand energy savings by APS, TEP, and UNSE customers have contributed to the capacity and reliability of the grid. As such, Arizona’s Energy Efficiency Standard has reduced the need for costly expenditures on additional generation, resulting in lower bills for ratepayers and over $1.7 billion in net economic benefits.
Prepared at the Commission’s request, Elliott D. Pollack & Company’s Economic, Small Business and Consumer Impact Statement (EIS) largely makes the case for extending and expanding Arizona’s Energy Efficiency Standard. Pollack & Company concluded that without it “residential customers may face higher consumption and long-term utility bill increases”; “low-and moderate-income households – especially in rural areas could be disproportionately affected”; “higher peak demand may require additional infrastructure investment”; and “the loss of regulatory guidance may create uncertainty around how energy efficiency is treated in resource planning and cost recovery proceedings.”
Arizona’s Energy Efficiency Standard not only contributes to reliability and economic benefits, including for ratepayers, it also provides regulatory certainty, peak energy load reduction, job creation, benefits to local economies, transparency, and meaningful opportunities for public participation.
APS’s Demand-Side Management Plan
Over the years, APS has developed and implemented programs proven to save energy and money for its customers. Through publicly accessible plans and compliance reports, as required by the Commission, APS ensures that specific information on programs, energy savings, expenditures, and other key data points can be scrutinized. Along the way, measures have been updated and/or changed as necessary to accommodate grid impacts, new technology, and ratepayer interest.
At a time when too many Arizonans are struggling to pay their monthly bills, and another rate significant increase is being considered, APS’ energy efficiency offerings can provide relief for all its ratepayers through avoiding additional strain on an increasingly overstretched and expensive grid. The utility’s latest proposed energy and cost-saving programs have been vetted by stakeholders and established as cost-effective by Commission staff.
Commissioners are often faced with difficult choices. Fortunately for them, saving money for ratepayers by extending and expanding Arizona’s Energy Efficiency Standard and approving APS’ Demand-Side Management Plan should be no-brainers.
Editor’s Note: Diane E. Brown is the Executive Director of the Arizona PIRG (Arizona Public Interest Research Group) Education Fund
