For Immediate Release: May 8, 2014
WASHINGTON—The National Association of Regulatory Utility Commissioners has signed onto principles with two State government associations over how energy efficiency programs could be used as part of a way to comply with upcoming federal emission reduction requirements.
The Energy Efficiency principles, accepted by NARUC, the National Association of State Energy Officers, and the National Association of Clean Air Agencies, focus on one of many potential compliance mechanisms that the Environmental Protection Agency might consider with regard to the widely anticipated proposal to reduce carbon emissions from existing power plants.
The principles present a flexible framework for the EPA to rely on in considering energy efficiency as one of many options that States incorporate in compliance plans under the proposed guidelines. The document is general by design and encourages EPA to recognize the diverse programs States have already undertaken to reduce emissions and promote cleaner, more efficient use of electricity.
“States are leaders in developing and implementing energy efficiency programs,” said NARUC President Colette D. Honorable of Arkansas. “This early action has equipped our nation with the tools necessary to further reduce emissions and promote more efficient electricity usage. While NARUC remains neutral on the existing and forthcoming EPA rulemakings, we encourage the agency to recognize each State’s diverse generation fuel mix and provide flexibility so electricity consumers are not overburdened. Energy efficiency is one of many ways States can use to comply with the EPA rules and we hope the agency will give this document strong consideration.”
President Honorable noted that energy efficiency is just one option available for States to consider, adding that she is pleased the three organizations reached consensus. “This document is notable because we reached consensus among three diverse organizations,” she said. “But we also recognize not every State will consider energy efficiency as their only path forward and therefore EPA should not require that efficiency be used in compliance plans.”
She also applauded the NARUC members who worked on the document. “NARUC’s delegates worked closely with those of NACAA and NASEO and brought a special expertise with regard to identifying the issues associated with including of energy efficiency as a possible compliance option for States to consider,” she said. “This is just the beginning in terms of what State utility commissioners have to contribute to the dialogue about how best to meet the challenges posed by the new regulation but still remain within the confines of the Clean Air Act.”
A summary of the document follows.
- Guidance on inclusion of energy efficiency: EPA should provide guidance to States, as soon as practicable, but no later than June 2015, setting forth a non-exhaustive list of approvable approaches/provisions that may be included in State compliance plans. States should have the option to adopt those and other policies and programs in their State compliance plans.
- State energy program recognition: EPA should afford great deference to State energy efficiency programs and policies and allow States to credit energy efficiency programs and policies that utilize EM&V protocols and standards as described in the document.
- Non-utility delivered efficiency: EPA should encourage States to develop a clear path for inclusion, crediting, and administrative review and oversight of non-utility-delivered energy efficiency activities providing emissions reductions.
- Recommended EM&V protocols and approaches: EPA, in consultation with the U.S. Department of Energy (DOE) and the States, should recommend protocols and approaches, and provide technical assistance for EM&V of State, utility and non-utility provided energy efficiency projects and programs.
- Translating electricity savings to avoided emissions: EPA may recommend tools, such as the Avoided Emissions and Generation Tool, dispatch modeling, and independent system operator/regional transmission organization (ISO/RTO) forecasting approaches, to calculate the emissions impacts of energy efficiency projects, programs and policies.
- Avoiding double counting: EPA should offer guidance on options for avoiding double counting of emissions reductions from public investment, utility programs, and non-utility delivered efficiency efforts. Double counting could occur if an entity funds an efficiency project within a utility’s service territory and transfers the credit to another regulated party or another State.
- Transmission and distribution efficiency: EPA should encourage and credit energy efficiency in the electrical transmission and distribution system.
- Multi-State or regional efficiency programs: EPA should recognize and encourage multi-state and regional energy efficiency efforts and compliance strategies, particularly where those programs use harmonized, consistent and transparent efficiency EM&V protocols and approaches and accounting standards for quantifying electricity savings and CO2 reductions.
- Energy Efficiency Registry: EPA should recognize that States or private entities may choose to develop or participate in a voluntary “registry” to establish a transparent data repository of energy efficiency projects or activities.
- Accountability for energy efficiency in state 111(d) plans: We acknowledge that EPA and many States believe that section 111(d) requires that State plans generate reliable, verifiable and enforceable greenhouse gas reductions. Energy efficiency efforts can meet these requirements, and in many cases at lower cost than other options. Because energy efficiency programs and policies may vary significantly, EPA should invite multiple approaches to achieving quantifiable and reliable reductions while avoiding imposing onerous and potentially expensive requirements on the States.
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NARUC is a non-profit organization founded in 1889 whose members include the governmental agencies that are engaged in the regulation of utilities and carriers in the fifty States, the District of Columbia, Puerto Rico and the Virgin Islands. NARUC’s member agencies regulate telecommunications, energy, and water utilities. NARUC represents the interests of State public utility commissions before the three branches of the Federal government.
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