The Alliance to Save Energy Goes Local in Maryland

The Alliance has been hard at work in Annapolis and around the state to help get ground-breaking energy legislation passed in Maryland. Governor Martin O’Malley’s Empower Maryland Energy Efficiency Act (HB 374 and SB205), one piece of an effort to transform Maryland’s energy policy, was recently enacted in the waning days of the legislative session in Annapolis.

Maryland is facing a number of challenges on the energy front. The state’s residents continue to see a dramatic rise in their energy costs. Maryland’s growth, while economically impressive, is creating a dangerous imbalance between energy supply and demand. If this situation continues there could be rolling blackouts during peak demand periods as early as 2011.

Kateri Callahan said “The Alliance to Save Energy has strongly supported measures to reduce the demand for electricity, and we believe that consumer education and effective media communications will help Maryland to relieve the pressure on the demand side and avoid the rolling black outs that could occur if energy consumption continues unabated.”

Governor O’Malley has set bold yet attainable goals to help the state tackle these challenges. The centerpiece of the EmPOWER Maryland Energy Efficiency bill is the goal of reducing statewide consumption and peak demand by 15% by the year 2015. These goals address the most effective near-term weapons for reducing greenhouse gas emissions. Meanwhile, Maryland can invest in Green Jobs and clean technology that will eventually produce a sustainable economic future for all Marylanders, a future that substantially reduces greenhouse gas emissions from the state.

Maryland would achieve these goals by requiring utilities to implement energy-efficiency programs that will reduce energy consumption. Utilities would have to cut per capita electricity demand 5% by 2011 and peak demand – electricity used during the times of heaviest demand, and therefore the most expensive electricity – by 5% by 2011, 10% by 2013, and 15% by 2015.

Malcolm D. Woolf, director of the Maryland Energy Administration, stressed the effectiveness of such legislation elsewhere in the country. He said “By comparison, residents in California, where such programs have been in place for years, now use 42 percent less energy per capita than Marylanders.”

There are a myriad of ways to reach the goals outlined in the bill. This legislation would encourage utilities to utilize methods such as offering residential, commercial and industrial customers incentives to purchase ENERGY STAR appliances, rebates for energy-efficiency improvements to new or existing homes, and window air conditioner and refrigerator exchange programs. Consumers would also be encouraged to make greater use of programmable thermostats and CFL bulbs. The utilities would also offer voluntary payments for the use of interruptible load devices on air conditioners.

Such programs have worked well elsewhere, notably in New York State, which offered a $75 “bounty” to residents who turned in old, inefficient room air conditioners and bought a new ENERGY STAR model. In one summer alone, more than 180,000 inefficient AC units were removed from the grid!

The potential savings are substantial. The Maryland State Energy Office has projected that the energy-efficiency targets in the governor’s energy bill would:

• Save Maryland consumers more than $2 billion by the year 2015 and over $4 Billion by 2020
• Eliminate carbon dioxide emissions equivalent to removing three million cars from the road.
• Avoid using 25 billion kilowatt hours of electricity, which is enough o power three-fourths of Maryland’s homes in 2015
• Prevent the need to build two large power plants

Investments in efficiency can also make energy cheaper—not just for those who make the investments, but for the entire economy. By reducing demand, energy efficiency programs can put downward pressure on the price of electricity and natural gas. In fact, recent studies by the U.S. Department of Energy estimate that for every 1 percent reduction in national natural gas demand, natural gas prices fall by 0.8 percent to 2 percent below forecast levels. That is particularly relevant for Maryland, where the price of electricity on the wholesale market is set primarily by natural gas generators.

Homeowners will likely be enthusiastic about this bill. For every annual dollar saved on energy bills, a home’s value increases by $20. if a household makes improvements that save them $250 per year on energy bills, their home’s resale value will increase by $5,000. In a real estate market where values are flat or declining, that is a significant incentive to make these changes. The Alliance to Save Energy has taken a three-pronged approach to working to get this legislation passed.

• Phone calls and e-mails from Alliance Advocates to the full Maryland Senate and House of Delegates encouraging them to support the bill as amended in committee;
• Encouraging activists to fax copies of their utility bills to their Senator and Senate President Miller with the phrase “Be a Leader. We Need Real Energy Solutions. Please Support Energy Efficiency;” and
• Thank you calls to Senators who supported the EmPOWER Maryland energy efficiency bill in the Senate Finance Committee.

These grassroots activities helped move the bill (SB205) out of the Maryland Senate Finance Committee and to the floor of the Senate. The companion bill (HB374) was considered and passed in the House of Delegates and the final legislation was approved and enacted.