State carbon reduction goals need to also focus on energy efficiency, ACEEE report finds
States with robust goals to cut greenhouse gas emissions risk incurring higher costs for households and businesses if they do not also focus on energy efficiency, a report from the American Council for an Energy-Efficient Economy (ACEEE) found.
The report said that most of the signature state climate policies, such as clean electricity standards and emissions reductions goals, have not articulated the important role of energy efficiency in decarbonizing state electric grids and economies. ACEEE officials said that without clear direction, state agencies and utility regulators may not prioritize energy-saving efforts. This would result in a key missed opportunity toward meeting clean energy and climate targets.
“Transitioning away from electricity sources that produce greenhouse gases is a big undertaking, and reducing energy waste is one of the most important tools. If your state doesn’t have a pretty clear plan for how to improve efficiency, it’s on an uncertain and potentially costly path toward decarbonization,” Weston Berg, senior researcher for state policy at ACEEE and lead author of the report, said. “It doesn’t make sense for any state to go after a big transformation of its energy system with one hand tied behind its back. We don’t want to look back in a decade or two and see that these states left some of the best tools on the table.”
For example, policymakers could adopt rules that enable utilities to provide customers incentives for buying electric heat pumps, set building energy performance standards that spur energy-efficient retrofits.
Of the 17 state policies that require a transition to 100 percent transition to clean electricity, only Virginia and Washington State included specific efficiency targets. Further, of the 24 states (and the District of Columbia) with greenhouse gas emissions reduction goals, 8 make no mention of energy efficiency, while 15 mention it in an undefined way. Only New York’s and the District of Columbia’s emissions targets encompass specific energy consumption reduction goals.
ACEEEʻs report points out that most of these states have a separate goal for reducing energy use through utility programs that incentivize customers to make energy-saving improvements. However, they should also be included in greenhouse gas reduction goals or clean electricity standards so they are a priority and not an afterthought.
Several studies state that improving energy efficiency is a key tool for decarbonization. The International Energy Agency’s global roadmap to reach net-zero emissions by 2050, for instance, calls for efficiency improvements averaging 4 percent per year through 2030.
The ACEEE report says expanded energy efficiency efforts would reduce the costs of meeting clean electricity standards by reducing the amount of renewable energy needed. Also, it would air in the the electrification of home equipment and transportation and make the transition to a decarbonized economy more equitable.
ACEEE is a nonprofit research organization, develops policies to reduce energy waste and combat climate change.
