Energy Efficiency Resource Standard Fact Sheet

Why Energy Efficiency in West Virginia?

  • Appalachian Power's residential rates have increased more than 50% since 2006.  Mon Power and Potomac Edison residential rates have increased about 30% in the last three years.  Taking advantage of the opportunities from energy efficiency will mitigate the impact of increasing electric rates on residents.
  • AEP (the parent company of Appalachian Power) and FirstEnergy (the parent of Mon Power and Potomac Edison) are already offering energy efficiency programs in other states where they operate, including Ohio, Pennsylvania and Maryland.  There is no reason the same opportunities shouldn't be available to West Virginians.
  • Our electricity system is facing serious challenges from potential retirements of old and inefficient coal plants in next several years.  Saving energy through efficiency will be cheaper for customers than footing the bill for expensive new gas power plants.
  • West Virginia's residential electricity consumption per person is 40% higher than the national average, implying significant potential for West Virginians to save money through improving residential energy efficiency.
  • Energy efficiency is cheaper than building new conventional or renewable energy power plants.
  • Investing in weatherization and other efficiency measures will create new jobs and an industry that cannot be outsourced.

 

An Energy Efficiency Resource Standard would require our utilities to meet targets for energy efficiency through 2025.  In 2011, we proposed a bill to establish an Energy Efficiency Resource Standard that would:

  • Require reductions in electricity consumption by 15% of 2010 sales by 2025 and peak electricity demand by 15% of 2010 peak demand by 2025.  Specifically the bill requires 2% reduction by 2015, 5% by 2018, 10% by 2022, and 15% by 2025.
  • Require utilities to develop plans every three years and submit them to the Public Service Commission (PSC), explaining how they plan to meet these targets through cost-effective energy efficiency and demand response programs.  Utilities must provide annual updates to the PSC on their progress towards achieving the targets. 
  • Require the PSC to report annually to the legislature on the status of energy efficiency programs, including the impact of programs and services directed to low-income communities.
  • Require the PSC to study the feasibility of setting energy savings targets for natural gas utilities.
  • Require the PSC to evaluate whether “smart meter” and “smart grid” technology are cost-effective in reducing electricity consumption.
  • Allow the PSC to approve financial incentives for utilities to recover revenues that would otherwise be lost through energy efficiency.
  • Allow the PSC to establish a special license fee of up to $600,000 to carry out the requirements of this bill.
  • Allow large industrial energy consumers to self-direct 80% of the money that they would otherwise pay to utilities for energy efficiency programs towards their own energy efficiency programs 
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