Embrace efficiency, one watt at a time, as nation's 'fifth fuel'

Sunday, April 22, 2007

By the year 2030, demand for electricity in the United States is expected to grow by approximately 40 percent, according to U.S. Department of Energy forecasts. To meet that need, plans to develop new nuclear and advanced cleaner-coal power plants and to retire older, less efficient coal plants, are under way at utilities throughout the nation.

But there is another path that can help us achieve our country's goal of reliable, affordable and clean energy for all - energy efficiency. As the "fifth fuel," it can be as useful in meeting our growing energy needs as are the traditional generation sources of coal, nuclear, natural gas or renewable energy.

'SAVE-A-WATTS' CONCEPT

Ensuring that saving energy is as important a "fuel" as generating power will mean a reinvention of the traditional utility. "Save-a-watts," unlike kilowatts, can only be envisioned as a fuel if we are committed to change.

What if utilities offered access to energy efficiency services to all customers universally, allowing them to take charge of their electric bills and empower them to help reduce the overall environmental footprint of the utility?

A business approach to energy efficiency would make that vision possible. Utilities have traditionally been rewarded for selling more energy not less. We need a future that puts investments in energy efficiency on an equal footing with new generation investments, so that a utility is able to achieve the same earnings when they make energy or save energy.

Developing and implementing this new regulatory paradigm will largely be decided by state regulators, who supervise retail electricity markets in the U.S. But creating the momentum necessary to get the job done will come from many sectors of society.

Electric utilities have the expertise - and a responsibility as well - to lead the kind of change needed to make efficiency an important part of the energy mix.

Technology to transform our electric transmission and distribution system into a digital communications network, is available but must be deployed. With it, the industry could transform the delivery of electricity in the same way that today's cell phones transformed telecommunications from rotary dial phones.

When the electric delivery system is combined with "smart" meters and energy sensing devices, customers will gain efficiency without giving up comfort and convenience. Energy efficiency would be as automatic as flipping a switch.

A 21ST CENTURY VISION

Imagine energy efficiency being the default service offer for all customers. Customers could choose to actively manage their energy usage by using power during "off peak" periods when power is cheaper or stay with a default offer.

In all cases, utilities could glean useful data from the transmission and distribution system, providing ways to measure and verify the results of energy efficiency initiatives.

In the year 2000, the National Academy of Engineering chose the electrification of America and the developed world as the greatest engineering achievement of the 20th century - ahead of air and space flight, television, the computer and the Internet.

We believe that turning the electric grid into a vast communications and energy efficiency network - one that can create save-a-watts - could very well be one of the greatest advancements of the 21st century.

U.S. Sen. Mark Pryor is a Democrat from Arkansas. Jim Rogers is president and CEO of Duke Energy. They are co-chairs of the Alliance to Save Energy.