Yesterday, the American Council for an Energy Efficient Economy released its seventh annual State Energy Efficiency Scorecard. The annual report ranks states on their policy and program efforts, and provides recommendations for ways in which states can improve their energy efficiency performance. As you can see from the national map, the Southeast is still lagging behind, with North Carolina as the only state that ranks among the top half of the country.
However, there is definitely some good news to share as well. Mississippi fared quite well this year, and was named one of the year’s most improved states. It received this accolade because the legislature passed a mandatory energy code for commercial and state owned buildings; and the Public Service Commission passed an energy efficiency rule that requires the utilities to file energy efficiency program plans by January 2014 .
For states such as Alabama and South Carolina, who may be curious about how to improve their score, the report offers several suggestions for how to improve lower rankings. These recommendations include creating and funding an Energy Efficiency Resource Standard, adopting more stringent building codes and improving code compliance, setting tailpipe emissions standards for cars and trucks, implementing Combined Heat and Power as an energy efficiency resource, and expanding and make visible state led efforts at efficiency.
I tallied up the scores from the 2012 and 2013 State Energy Efficiency Scorecard for our region. Of the seven states SACE focuses on, one fell in ranking (NC), one stayed the same (GA), and five improved (FL, TN, AL,SC, MS).
| State | 2012 Ranking | 2013 Ranking | ||
| North Carolina (down) | 22 | 24 | ||
| Florida (up) | 29 | 27 | ||
| Tennessee (up) | 32 | 31 | ||
| Georgia (same) | 33 | 33 | ||
| Alabama (up) | 40 | 39 | ||
| South Carolina (up) | 40 | 39 | ||
| Mississippi (up) | 51 | 47 |
While it’s fantastic that five of the states in the Southeast moved up, the writing is on the wall: Other states are raising the bar. If the electric utilities in the Southeast do not continue improving, they will quickly fall in rankings. In the 2012 State Energy Efficiency Scorecard, there were 12 states that achieved 1% savings as a percentage of retail sales; and in 2013, there are 14. As more and more states begin to achieve 1% of retail sales with efficiency, the farther behind our states fall.
Currently, there are no states in the Southeast that are achieving 1% of retail sales with energy efficiency, although Arkansas is on track to achieve that level in 2014. As shown below, the utility leaders in SACE’s focus area are only at 0.65% savings, which continues to put the Southeastern utilities at the back of the line in regard to national energy efficiency rankings.
With the upcoming Florida Energy Efficiency Conservation Act proceeding – which is unlikely to produce significant efficiency gains due to absence of both state and utility motivations – Florida is unlikely to remain at 27th next year. Further, Georgia has nowhere to go but down in the rankings as Georgia Power, the largest utility in the state, won’t even consider increasing their energy efficiency goals for another two years, while their peers continue marching forward to save customers money on bills and generation investments.
Tennessee’s score is a bit more convoluted than the other states for a few reasons – first that TVA does not receive points for having a lost revenue adjustment mechanism or performance incentive. I agree that these are critical elements to any state policy for investor owned utilities, but as TVA is a federally owned utility, the financial incentives align a little differently. Hopefully in the next year’s scorecard, TVA’s use of energy efficiency in its Integrated Resource Plan will bump its score up some.
Finally, I was surprised to see that Alabama had improved their state energy efficiency score – but it definitely was not due to their efforts with electric energy efficiency. As you may recall, the state declined $540,000 in Department of Energy funding for energy efficiency. The report gave Alabama points for building energy codes because, in 2012 the State made the Alabama Energy and Residential Code mandatory for the first time. Also, Alabama scored well for having state government initiative to support energy efficiency, including efficiency goals for public buildings, new and existing state building requirements, efficient fleets, and energy service performance contracting policy and programs.
We hope that 2013 will bring increased energy efficiency savings in the Southeast, and in the upcoming months, SACE will advocate for utilities in our states to improve their energy efficiency programs, and begin to explore the non-energy benefits of energy efficiency to support the economics of low-income energy efficiency programs.