BGE Behind on Energy Efficiency Goals
Baltimore – BGE will only meet 52% of its 2011 energy efficiency goal according to a new Maryland PIRG Foundation report, Utility Work Ahead: A First Look at Progress Toward Meeting EmPOWER Maryland Goals, released today.
The report found that BGE is not alone; none of Maryland’s electric utilities is on a trajectory to reach the goals set out in the EmPOWER Maryland Act passed in 2008. In fact, due to the failure of utilities to propose adequate energy efficiency programs, Maryland is on track to fall roughly 25 percent short of the energy savings promised under the codified goal.
“The good news is that BGE’s energy efficiency programs are up and running,” said Maryland PIRG State Director, Johanna Neumann. “The bad news is that BGE was slow to get started and its plans fall far short of the energy savings Marylanders desperately need.”
There is tremendous need for energy efficiency in Maryland. On average, each Marylander used 22 percent more power in 2008 than in 1990. From 1999 to 2008 the electricity portion of an average household’s power bill increased more than 30 percent to $1,650 per year, adjusting for inflation.
By improving energy efficiency and using energy more wisely, Marylanders can cut their electricity consumption, save money and boost the state’s economy. Meeting the goals of EmPOWER Maryland could save consumers and businesses $861 million annually and add 8,000 new jobs in the state by 2015.
“We have proven that cost-effective investments in energy efficiency save Maryland property owners money,” said Peter Van Buren, President of Terra Logos Energy Group.”Homeowners that have followed our suggestions have saved 20-40% or more on their energy bills. In addition, underwriting the costs of energy improvements through incentives helps to grow the emerging green construction sector. This keeps our money here in Baltimore and employs people with well-paying local jobs.”
BGE: GOOD START, BUT NOT ENOUGH
BGE has launched all its efficiency programs, though some began months after the PSC approved the utility’s plans. If BGE fully implements its plan, in 2011 the utility will achieve only 52 percent of its EmPOWER Maryland energy savings goal. By 2015, BGE will reach 63 percent of its goal. Making matters worse, the utility has gotten a slow start implementing these programs. In 2009, BGE’s energy efficiency improvements reduced consumption by 111,000 MWh, 63 percent short of expected savings.
On the bright side, the utility offers a suite of programs to help its customers save energy. For residential customers, BGE has planned several programs for efficient lighting and appliances, as well as programs to encourage the installation of more efficient heating and cooling systems. The utility will also offer financial incentives to builders who make more efficient homes and has proposed a series of home energy audit programs.
For small commercial customers, BGE offers assistance with replacing functional but inefficient equipment, and with purchasing more efficient replacements for equipment that has failed. Large commercial and industrial customers can improve their efficiency through three efficiency programs run by the utility.
“All of the programs deliver energy savings at lower cost than buying power,” said Neumann. “These energy efficiency programs are a great deal and should be expanded.”
In approving the utility programs, the Public Service Commission relied heavily on a narrow definition of cost effectiveness that fails to acknowledge all the benefits of energy efficiency. The report recommends a broader measure of cost-effectiveness that would allow the state to capture more of its energy efficiency potential.
Maryland PIRG Foundation analysis finds that BGE’s residential programs are disproportionately oriented to lighting and appliance efficiency. Research shows that the utility could increase its residential electricity savings by expanding its programs that help seal air leaks and improve heating/cooling efficiency. BGE would reap especially large savings by structuring its weatherization, heating and cooling programs to target the 34% of Maryland homes that use electricity for space and water heating.
Maryland PIRG Foundation’s report provides the first analysis of how on-track Maryland’s utilities are to meeting statewide energy efficiency goals. Under state law, the utilities will be required to report their progress to meeting the EmPOWER Maryland goals to the General Assembly next year.
