February 14, 2009

Decoupling and the Stimulus Bill

What has been California's secret for achieving decades of increased energy efficiency? It's a policy known as decoupling where the energy companies share in the savings achieved by helping their customers save energy.

It seems like such an incredibly smart thing to do: align the interests of the energy company and their customers to doing the right thing. But evidently, encouraging this type of policy is seen as repressive and not fair to the states. Considering one alternative is for states to encourage their power companies to gouge their citizens, I guess I should not be surprised.

The original stimulus package stipulated that states would have to implement decoupling to receive federal funds that were devoted to achieving energy efficiency. But foes of decoupling successfully lobbied to have this requirement emasculated.

Why oppose decoupling? Because:

"You shouldn't condition a state's receiving (grant) money to promote energy efficiency on a state program that means consumers could spend more money on their utility bills," Yacker said. His organization is against decoupling because "utilities are not the best vehicles to achieve energy efficiency." Customers should be the targets of efficiency programs, and there should be no guarantees of utility profits through decoupling, he said.

Evidently, his organization doesn't care that under old system, the energy companies should work to encourage their customers to be extremely wasteful of energy, because then they maximize their profits. Or perhaps they believe that energy companies should go out of business because their customers who have magically become extremely energy efficient no longer buy enough to keep the company viable.

An even more foolish argument comes from those who think it is wrong to gate money going to the states by directing a particular policy.

State utility commissioners may be opposing this legislation because of territorial concerns, according to Goldenberg, who at one time was special counsel to the New Jersey Board of Public Utilities. "There's a natural resistance about being told how to do things that fall in their regulatory jurisdiction."

I'd like to know what other bright ideas have been percolating at the state level that shows as much promise and provable results as decoupling. And if there isn't, then why can't we put conditions on what the state has to do to receive these moneys? After all, for most programs where states get money there are conditions that must be met.

And California proves that both customers and energy companies win when this policy is in place.

In my opinion, energy efficiency is so important to the future of our country that this policy should be mandated at the federal level. We've lost a BIG opportunity to really make a difference with for the future with just that one little change in the stimulus bill.

Posted by Mary at February 14, 2009 11:07 PM | Energy | Technorati links |

Iím passionate that we need to take it further with regards to green energy. The best way to bring the changes we need in the economy and the environment is by creating local jobs to improve our infrastructure to lessen the impact on the environment. I feel really inspired after reading Thinking Big, especially the essay called An Inclusive Green Economy by Van Jones and Jason Walsh. They took the idea of green collar jobs farther and suggest a Clean Energy Corps be created that is a combined service, training, and job creation effort, concentrated in cities and struggling suburban and rural communities. Basically the idea is that price and the market are too slow to base the shift to a green economy on, which I totally agree with, and we should have a governing body put into place that coordinates green collar efforts to maximize efficiency and opportunity creation for Americans.

Posted by: Aegean at February 19, 2009 12:40 PM