December 22,2009

Our View

By Bev Gard & James Merritt

Whether you believe in the need to reduce greenhouse gases or not, one painful truth is inescapable: Virtually every recent proposal to reform our nation's energy policy will mean sharply higher electric rates for Indiana.

That's the bad news.

The good news is that Indiana's major electric utilities have been ordered to reduce electricity consumption by 2 percent through energy efficiency programs. We believe these are among the most effective and cost-efficient ways to deal with our energy problems.

Energy efficiency isn't a silver bullet. But a coordinated, statewide energy efficiency effort is a significant and realistic step in the right direction and we applaud the Daniels administration for taking it. To be successful, however, everyone must take part.

How will we use less energy? Largely through "demand-side management,'' which is utility industry shorthand for programs that encourage everyone to use less electricity.

You may already be familiar with some programs, such as those that offer incentives to use energy-saving light bulbs and Energy Star appliances. These programs are effective, but they aren't enough. To meet the administration's 10-year goal, we'll likely have to address the "price signals" of electricity and consumers' ability to manage energy costs.

What if utilities offered time-of-day pricing through the use of a "smart meter" able to monitor and control the usage of individual appliances in your home and relay real-time price information? We consumers would quickly discover that using electricity at times of peak demand is an expensive proposition. We'd also discover that the old refrigerator in the garage is a costly energy hog, and that big screen plasma TV in the living room is no bargain to operate either. We might be motivated to change our consuming habits.

When we use less, utilities have to produce less, which means lower electric bills and fewer air emissions.

Energy efficiency involves up-front costs to produce long-term savings. Installing millions of smart meters in Indiana would be expensive, and while they would likely save consumers money in the long-run, utilities would have to recover the installation costs up front in the form of higher rates.

Second, everyone must change habits, especially electric utilities. For decades, utilities have operated under a business model that rewarded them for selling more power. We'll now want to reward them for encouraging lower usage. And, if we change the way we regulate them, we must ensure that we don't encourage utilities to reduce consumption at the expense of economic development.

Consumers will have to change our ways, too. The more we're willing to reduce consumption, the better we'll be able to manage our monthly bill. That may be especially true for businesses such as manufacturers that may find enormous energy savings by operating late at night, when electricity is generally cheap.

According to the Rand Corporation, the utility industry nationally could save between $50 billion and $100 billion over the next two decades if demand response programs become the norm. That not only translates into better prices for consumers, but it also would diminish stresses on power plants, along with the subsequent emissions.

A concerted effort to increase the state's level of energy efficiency may take some getting used to, but we believe the effort is well worth it.

Gard, R-Greenfield, is chairman of the Indiana Senate Energy and Environmental Affairs Committee. Merritt, R-Indianapolis, is chairman of the Utilities and Technology Committee.

This article reprinted from http://www.indystar.com/article/20091222/OPINION01/912220312/1002/OPINION/Jolted-into-efficiency-We-all-must-do-our-part

and brought to you by the Indiana Renewable Energy Association.

Editor's note: Here are the ordering paragraphs from the Commission Order:

IT IS THEREFORE ORDERED BY THE INDIANA UTILITY REGULATORY
COMMISSION that:

1. The Commission hereby establishes an overall annual energy savings goal of 2% to be achieved by jurisdictional electric utilities in the State of Indiana within 10 years, with interim savings goals established in this Order to be achieved in years one through nine.

2. The Commission hereby establishes initial DSM Core Programs that shall be offered by jurisdictional electric utilities throughout the State of Indiana. The Core Programs shall be overseen and coordinated by an Independent Third Party Administrator in a manner consistent with the findings set forth in this Order.

3. The Commission hereby requires the formation of a DSM Coordination Committee comprised of the entities described in this Order. An initial objective of the DSM Coordination Committee shall be the issuance of two requests for proposals ("RFPs"). The first RFP shall be issued for the selection of an Independent Third Party Administrator to oversee and coordinate the Core Programs established in this Order. The second RFP shall be issued for the selection and utilization of an evaluation administrator(s) to undertake Evaluation, Measurement & Verification of DSM program offerings.

4. The Commission hereby finds that in order to ensure that the objectives of this Order are being fully satisfied, compliance filings shall be submitted as ordered in this proceeding to provide a means for Commission review of the following matters: (i) the proposed organizational and operational structure of the DSM Coordination Committee; (ii) the three-year DSM Plans and the annual supplemental updates; (iii) the proposed RFPs required by this Order; and, (iv) any additional compliance filings required under this Order. For this purpose, the Commission hereby establishes an Implementation Subdocket in this proceeding under Cause No. 42693 S-1.

5. The Commission finds that with respect to issues other than compliance with the terms of this Order, that will be overseen by the Commission in the Implementation Subdocket, this proceeding is hereby concluded.

6. This Order shall be effective on and after the date of its approval.

ATTERHOLT, GOLC, LANDIS AND ZIEGNER CONCUR; HARDY ABSENT:
APPROVED: DEC 0 9 2009

Click here to request a copy of the order.

By Jesse Davis
THE GOSHEN NEWS

http://www.goshennews.com/local/local_story_352181759.html

MIDDLEBURY, Ind — There may be momentum building, but we’re still at the back of the pack.

The monthly meeting of the Sustainable Business Resource Network became a mini-referendum on Indiana’s place in the growing push for clean, renewable energy. Held at Middlebury’s Home Energy LLC and featuring guest speaker David Eberhardt of the Citizen’s Action Coalition, the meeting even drew two local leaders — County Commissioner Mike Yoder and state Rep. Wes Culver.

Culver, who has been outspoken in his support of wind and solar energy and in pointing out the influence of the coal industry on the statehouse, said major change in Indiana’s energy policies will more than likely have to start at a grass roots level.

“I think it’s pretty much lip service when they talk about green jobs (in the statehouse),” Culver said. “They want coal plants. I don’t see it starting from the top down.”

Culver explained several bills have been started in the house regarding energy issues such as net metering, but have all been shot down in the Senate. At a speaking engagement in June honoring local companies that took steps toward energy conservation, Culver said Indiana allows consumers who generate their own energy to sell up to 100 kilowatt-hours back to the grid for retail credit, putting the state in a tie for lowest in the nation. He said the defeated bills suggested new limits of up to five megawatt-hours.

“It’s a really weak movement,” Culver said. “There’s not much strength in Indiana to get it done.”

Eberhardt shared state statistics gathered by the CAC during the meeting, mainly regarding coal, which he said makes up 96 percent of the state’s energy use, just behind national leader West Virginia. According to Eberhardt, another major issue is that the coal mined in the state can’t be burned here.

“Our coal is really dirty,” Eberhardt said. “We can’t burn it in Indiana, it has to be burned in plants grandfathered under the Clean Air Act.”

He said dirty coal is an issue throughout the Ohio River Valley, not just in Indiana.

Stepping back from the state level and getting into green efforts in Elkhart County, Yoder was optimistic.

Along with the entrance of Electric Motors Corp. and Energy-Inc., the front-runner in the county’s plan to generate fuel and energy from waste at the county landfill, Yoder said another announcement of a green technology company in the automotive field is scheduled for Tuesday. He said other companies are also looking at locating in the county.

“This last year, because we achieved such notoriety,” Yoder said, “a large percentage of the companies looking here are in the green energy field.”

He sees immense potential in particular from Energy-Inc. and the possibility of effectively eliminating a major portion of the county’s waste stream.

“If we can do that,” Yoder said, “I would challenge any town in Indiana to be as green as we are.” As discussion turned to energy efficiency on a household level, attendees shared a pragmatic if not unpopular view. They agreed that the biggest deterrent to change in people’s personal energy use habits was the availability of cheap energy.

SBN steering committee member Joel Barrett, an employee of WVPE public radio, said he tells people he would have no problem paying higher utility costs if more of the energy was coming from clean and renewable sources.

“They don’t understand why I’m okay with that,” Barrett said.

He said it was a symptom of a larger problem.

“Americans don’t tend to change,” Barrett said, “unless we’re forced to.”

Home Energy LLC in Middlebury is a Business Member of the Indiana Renewable Energy Association.

November 17, 2009, 12:59 PM ET.

http://blogs.wsj.com/environmentalcapital/2009/11/17/blown-away-wind-power-keeps-growing-in-texas/

By Russell Gold, Wall Street Journal Blogs

Can the U.S. produce 20% of its electricity from wind? The U.S. Department of Energy thinks it can get there by 2030.

That doesn’t sound so far fetched anymore. A couple weeks ago – October 28th to be exact – wind turbines provided about 25% of Texas’ power consumption. (See the second page of the Texas electric authority ERCOT CEO’s update here.)

Of course, that could have been in the middle of the night when the good people of Flatonia, Amarillo and Gun Barrel City – not to mention Houston and Dallas – were asleep. (Update: It was in the middle of the night. Three a.m. to be exact.) Spain topped out at 53% of grid electricity from the wind earlier this month, but that occurred at about 5 a.m. while most Spaniards were asleep.

But back in Texas, a little before 8:30 p.m. on Wednesday October 28th, the Lone Star State got about 6,223 megawatts from the wind. That’s a record. At the time, the total load was about 35,000 megawatts. That’s 17.8% of its power from the wind. (That’s not sleepy-time power usage. Texas power consumption peaked in October at 49,100 megawatts.)

What does this mean for Texans electric bills? They could be headed down. A recent report finds that wind power is replacing more expensive forms of power generation.

This article brought to you by the Indiana Renewable Energy Association.