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The $20 Billion Bonanza: Best Practice Electric Utility Energy Efficiency Programs and Their Benefits for the Southwest


October 10, 2012

Research Report E12D

Authors:

Howard Geller (SWEEP) with assistance from Bruce Biewald, Marshall Goldberg, Steven Nadel, Maggie Molina, Max Neubauer, Jeff Schlegel, Rachel Wilson and David White

Description:

This report reviews the energy efficiency efforts of electric utilities in the Southwest U.S. over the past decade and analyzes the potential for growing success over the next decade. ACEEE was a contributing author on the report and worked with SWEEP to analyze a comprehensive set of eighteen best practice electric utility energy efficiency programs for each of the Southwest states’ residential, commercial, and industrial sectors. The report also outlines critical design elements that will allow these programs to reach more customers and savings, such as innovative and effective marketing techniques, financial incentives, and behavioral approaches.

If all utilities in the region adopt a full suite of best practice energy efficiency programs, households and businesses could save a staggering $20 billion by 2020. Utilities will benefit as well through costs reductions for capital, operation and maintenance, fuel purchases, and emission controls, while also decreasing their need for water withdrawal and consumption.

The growth of utility programs in the Southwest has been heavily influenced by policies enacted either through the state legislatures or by the state utility commissions during the past decade, and the number of enabling policies has grown noticeably over the last five years. However, the region-wide adoption of these policies is not yet complete and commitment to their integrity varies widely from state to state. Realizing the maximum cost-effective potential of the best practice programs will only be achieved if utilities and regulators make genuine, concerted efforts to establish and nurture a regulatory foundation upon which these programs can flourish.