Early investments in energy efficiency under the Obama Administration’s Clean Power Plan should qualify for the same credits as renewable energy projects, a group of 60 businesses, governments, and non-profits advised this week in a letter to Environmental Protection Agency Administrator Gina McCarthy.
“Energy efficiency is a zero-emission and least-cost option for states to use in complying with the Clean Power Plan (CPP) while supplying affordable, reliable electricity to their residents and businesses,” states the letter, organized by the American Council for an Energy-Efficient Economy (ACEEE). “To ensure that early action is rewarded and that the momentum of efforts in states is not stymied, we recommend that early investments in energy efficiency receive at least the same incentive as early investments in renewable energy.”
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Pointing to the EPA’s finding that energy efficiency is the cheapest path to CPP compliance, the letter says favouring renewables over efficiency “will in effect be making the [Clean Energy Incentive Program] more expensive for states to implement. This will particularly impact communities with high energy burdens and those most vulnerable to climate change.”
It notes that energy efficiency meets all the criteria for renewable energy technologies to qualify for federal credit under the program: a zero-emitting resource, an option that is essential to long-term climate strategies, the potential to counteract a shift in investment from renewables to natural gas in the lead-up to CPP implementation, and relatively quick lead times for investment and deployment.
“As we have seen with past air regulations, administrative uncertainty surrounding compliance approaches is highly discouraging to states,” the signatories warn.
“Even though every state implements utility-run energy efficiency programs, only a handful of states have taken credit for energy efficiency in their past state implementation plans (SIPs). Providing a clear path for energy efficiency to receive credit as an early action compliance approach will offer certainty to states considering energy efficiency as a compliance strategy.”
