Environmental Protection

Arkansas, Wisconsin Join States with Energy Efficiency Resource Standards

ACEEE says 26 states now have developed a standard, representing 65 percent of U.S. electricity demand.

Arkansas and Wisconsin recently took action on energy efficiency policies, according to the American Council for an Energy-Efficient Economy (ACEEE).

On Dec. 10, Arkansas adopted a comprehensive set of policies (pdf) on utility energy efficiency programs, including an Energy Efficiency Resource Standard (EERS). Four days later in Wisconsin, the Joint Committee on Finance approved recommendations set in an Order (pdf) given by the Public Service Commission of Wisconsin (PSCW) to increase funding to Focus on Energy, the statewide energy efficiency provider, and set performance goals that will function as an EERS.

An EERS requires electricity and natural gas providers to meet annual energy savings goals by providing energy efficiency program services.

Max Neubauer, ACEEE research associate, authored an energy efficiency potential study for Arkansas early in 2010 that recommended the adoption of an EERS. He said: "The orders given by the Arkansas Public Service Commission signify a break from the commonly voiced doctrine in the Southeast that any expense on utility bills is a bane of business and economic growth. In fact, it is quite the opposite with regards to energy efficiency. It costs far less to save a kWh than to generate one, so energy efficiency encourages economic growth by creating a robust, sustainable energy market that offers new business opportunities, generates jobs, saves consumers money, and curbs the strain on our environment."

The Arkansas targets are moderate, rising from an annual reduction of 0.25 percent of total electric kilowatt-hour (kWh) sales to 0.75 percent of total electric kWh sales over the next three years (and slightly less for natural gas sales), but require a high level of verification to ensure that utility companies are fairly rewarded, and that consumers get solid cost benefits.

The Wisconsin electricity goals, as a percent of peak load and electric sales, amount to 0.75 percent in 2011, ramping up to 1.5 percent in 2014. The PSCW also approved natural gas goals of 0.5 percent in 2011, ramping up to 1 percent in 2013.

Twenty-six states now have an EERS, accounting for 65 percent of the country's electricity demand. The policies currently on the books will provide electricity savings equal to 6 percent of nationwide retail sales by 2020. Dan York, deputy director, ACEEE Utilities Program, explained further: "The EERS will ensure that Wisconsin continues to reap the significant cost savings that result from investments in more energy-efficient homes, businesses, and industries."

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