Statement of Johanna Neumann
It is unfortunate that Alleghany’s botched
implementation is leading lawmakers to question the value of all utility-run
energy efficiency programs. One flawed program doesn’t mean that all programs
that make it easy for consumers to reduce their energy usage should be
abandoned.
In 1999 as a result of electricity deregulation, utility
companies abandoned energy efficiency programs. As a result the state saw
dramatic increases in demand, utility rates skyrocketed and we’re facing
brown-outs as early as three years from now. Energy efficiency is the only way
we’ll stop the brown-outs, and it’s the fastest and most economical way to meet
our energy needs.
By implementing energy efficiency programs, Maryland’s utilities are
building a “virtual power plant”. As with a traditional power plant, this
virtual power plant will be under development for several years and has many
different parts. If Alleghany and BGE programs have defects, they should be
sent back for correction and the utility should be held accountable. Saving
energy in Maryland costs far less than building
a new power plant to supply new electricity to Maryland.
All consumers save money as a result of energy
efficiency programs, whether they participate in the program or not. It makes
sense to have each consumer pay a little bit towards the pot, because everyone
benefits.
Persons who do participate in the program see direct
savings as a result of lower energy usage and lower bills. For example,
according to the American Council for an Energy Efficient Economy, one compact
fluorescent light bulb saves a consumer approximately $30 over the life of the bulb.
The $3 spent on a bulb, results in $27 in savings for the consumer.
Persons who do not participate, or who are not targeted
by a program see indirect savings as a result of reduced demand on the spot
market and not needing to build expensive new power plants or transmission
lines.
That being said, the PSC should make sure that energy
efficiency programs are available to all sectors of society, in particular the
working poor who are disproportionally harmed by the rise in
rates.
Our utility companies need to get used to the fact that
these programs are here to stay. It’s the PSC’s job to make sure programs get
implemented properly and that utility companies, not the ratepayers, bear the
cost of a flawed implementation.
