Bring on the Negawatt

Written by Cynthia Adams, Executive Director LEAP-VA and VAEEC Steering Committee Member

I work in the “energy” industry, which is an interesting thing in and of itself since the main focus of the nonprofit I run is to create energy through not using it. LEAP implements residential and commercial energy efficiency programs in central and northern Virginia. We seek to create the “negawatt” instead of the “megawatt.” It’s a bit of a stretch for a commodity, I know. A gallon of oil, we get. A cord of wood, no problem. A tank of propane, sure. Even a battery has something of substance to it, but a negawatt? What’s that?

In the classic economic terms of supply and demand, Virginia has more demand for power than we can supply in state – in terms of generation, that is. Our power companies purchase power from others who make it, and those electrons make their way through the power lines (known as the grid), all the way to our homes and businesses. Could be they were made by a turbine in a coal-fired plant in West Virginia, or a gas plant in Ohio, but we import a significant amount of power in our state. Like all who do not own the source or the supply chain, we are at risk to rising costs for that power we need.

Utilities like Dominion Virginia Power are building new power plants to meet the increasing demand and to upgrade or retire older, less efficient plants. In fact, our state’s regulatory body, the State Corporation Commission, recently approved Dominion building a new gas-fired power plant in Warren County. Because it costs money to create new power through generation ($1.1 billion for the Warren County plant), there is value to creating “new” power through removing the need for it. The negawatt can be bought and sold on the grid similar to other electrons. At LEAP we try to educate people on this whenever possible because the power plant we build in the aggregate through energy improvements brings with it many other benefits as well. It saves building owners money, and it employs people in the local community. Another power plant may keep the lights on, but it won’t improve the value of your home, free up operating capital, or help a neighbor make ends meet.

This legislative session the VAEEC is excited to see and support a bill in the Governor’s Energy Package which helps to remove a regulatory burden from utilities seeking to create energy efficiency programs for residents and businesses. Our State Corporation Commission approves or denies utilities’ requests to fund new programs, build new plants, run new power lines. Some worry about increasing rates if utilities create efficiency programs because the funding for them has to come from somewhere. In the end, we don’t keep rates lower because we do less efficiency – power companies will buy more and build more to make up for the deficit, and the $.65 added to the average residential customer’s monthly bill to fund the Warren power plant is a case in point. Energy efficiency costs $.03 – $.04 a kWh to fund, vs. the $.08 – $.10 kWh for a natural gas plant like the one in Warren County. Either way, we pay the bill (plant or program), and you don’t need to be a professional in the energy field to figure out the power you don’t use is a heck of a lot cheaper than the power you have to make.

Bring on the Negawatt

Written by Cynthia Adams, Executive Director LEAP-VA and VAEEC Steering Committee Member

I work in the “energy” industry, which is an interesting thing in and of itself since the main focus of the nonprofit I run is to create energy through not using it. LEAP implements residential and commercial energy efficiency programs in central and northern Virginia. We seek to create the “negawatt” instead of the “megawatt.” It’s a bit of a stretch for a commodity, I know. A gallon of oil, we get. A cord of wood, no problem. A tank of propane, sure. Even a battery has something of substance to it, but a negawatt? What’s that?

In the classic economic terms of supply and demand, Virginia has more demand for power than we can supply in state – in terms of generation, that is. Our power companies purchase power from others who make it, and those electrons make their way through the power lines (known as the grid), all the way to our homes and businesses. Could be they were made by a turbine in a coal-fired plant in West Virginia, or a gas plant in Ohio, but we import a significant amount of power in our state. Like all who do not own the source or the supply chain, we are at risk to rising costs for that power we need.

Utilities like Dominion Virginia Power are building new power plants to meet the increasing demand and to upgrade or retire older, less efficient plants. In fact, our state’s regulatory body, the State Corporation Commission, recently approved Dominion building a new gas-fired power plant in Warren County. Because it costs money to create new power through generation ($1.1 billion for the Warren County plant), there is value to creating “new” power through removing the need for it. The negawatt can be bought and sold on the grid similar to other electrons. At LEAP we try to educate people on this whenever possible because the power plant we build in the aggregate through energy improvements brings with it many other benefits as well. It saves building owners money, and it employs people in the local community. Another power plant may keep the lights on, but it won’t improve the value of your home, free up operating capital, or help a neighbor make ends meet.

This legislative session the VAEEC is excited to see and support a bill in the Governor’s Energy Package which helps to remove a regulatory burden from utilities seeking to create energy efficiency programs for residents and businesses. Our State Corporation Commission approves or denies utilities’ requests to fund new programs, build new plants, run new power lines. Some worry about increasing rates if utilities create efficiency programs because the funding for them has to come from somewhere. In the end, we don’t keep rates lower because we do less efficiency – power companies will buy more and build more to make up for the deficit, and the $.65 added to the average residential customer’s monthly bill to fund the Warren power plant is a case in point. Energy efficiency costs $.03 – $.04 a kWh to fund, vs. the $.08 – $.10 kWh for a natural gas plant like the one in Warren County. Either way, we pay the bill (plant or program), and you don’t need to be a professional in the energy field to figure out the power you don’t use is a heck of a lot cheaper than the power you have to make.

VAEEC Applauds Governor McDonnell’s Energy Legislative Package

Charlottesville, VA – January 5, 2012 – Today, Governor Bob McDonnell unveiled his upcoming energy legislative priorities for the 2012 Session of the Virginia General Assembly.  The Virginia Energy Efficiency Council (VAEEC) applauds the effort of the Governor on his “all of the above” approach which includes energy conservation and efficiency.

The Governor includes a proposal to eliminate regulatory uncertainty on how energy efficiency programs are approved by the State Corporation Commission (SCC).  This new legislation allows the SCC to approve energy efficiency programs which pass three out of four cost benefit tests.  In addition, this proposal aids utilities in promoting and offering additional energy efficiency programs to low-income individuals and seniors.  This bill would apply both to the electric and natural gas markets.

“The VAEEC approves of the energy efficiency proposal in the Governor’s energy legislative package and looks forward to working with him, bill patrons Delegates Ware and Cosgrove and Senators Watkins and Puckett, and others in the General Assembly to pass such needed legislation.  Energy efficiency is an engine of economic growth – creating jobs in Virginia while consumers save money on their energy bills.  It is a win-win situation,” said Cynthia Adams, Executive Director of LEAP-VA and founder of the VAEEC.

“With this legislation residents of Virginia will have more opportunities to improve their home’s energy performance and reduce their utility bills,” states Bill Greenleaf, Executive Director of the Richmond Region Energy Alliance.

“The Governor is doing the right thing for the Commonwealth and its residents,” said Paul Orzeske, president of Honeywell Building Solutions. “Generating ‘negawatts’ — or using less — is the cheapest and greenest source of energy. Efforts to increase efficiency also boost energy security and put people to work. The Governor’s proposals will encourage more programs that help homeowners and businesses trim utility consumption and costs, putting Virginia on the path to becoming a preeminent leader in energy efficiency.

 

About the VAEEC

The Virginia Energy Efficiency Council is a newly formed trade organization whose mission is to promote policies, programs, and technologies that expand investment in energy efficiency, our most affordable domestic energy resource. www.vaeec.org

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