FirstEnergy efficiency program gets a slow start in 2012 - Clarksburg, Morgantown: News, Sports, Weather

FirstEnergy efficiency program gets a slow start in 2012

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An energy efficiency program offered by Mon Power and Potomac Edison is ramping up — slowly.

The program saved about 2,900 of a targeted 8,000 megawatt-hours in its first 11 months.  

The companies filed a status report with the Public Service Commission of West Virginia on March 1 detailing the 2012 operation of their Phase I Energy Efficiency and Conservation program.

States and their public service commissions increasingly require electric utilities to undertake energy efficiency programs.

That's because it can be cheaper for a utility to pay families to upgrade their home insulation, for example, than to pay for the equipment and fuel to generate the electricity the upgraded insulation would save.

Quite a bit cheaper: Energy efficiency programs can have lifetime levelized, or apples-to-apples, costs of 1.7 cents to 4 cents per kilowatt hour, according to a recent report, compared with 5.5 cents/kWh and up for new generation.

So, efficiency programs keep rates down.

The savings in West Virginia could be significant, because Mon Power and Potomac Edison together serve more than half of the state's electric utility customers.

The companies' Phase I efficiency program is not ambitious. The commission said on approving the proposal in December 2011 that it was not "overly impressed."

The program's 2016 goal of reducing total system demand and system peak demand both by 0.5 percent from the 2009 levels falls far short, for example, of Ohio-mandated reductions of more than 4 percent FirstEnergy companies are meeting over the same period.

The program got up and running on Feb. 1, 2012, in West Virginia and has two parts.

A residential low-income program replaces light bulbs, faucet aerators and shower heads in low-income homes — those within 200 percent of the federal poverty level — and also incentivizes refrigerator replacement for those who qualify and offers partial energy audits. A non-residential program rebates high-efficiency lighting for commercial, industrial and government customers.

The first year of the program fell a little short of its goals.

The residential low-income segment came fairly close. Its 730 participants represented 94 percent of the 2012 goal of 773. The energy savings of 609 megawatt-hours came to 71 percent of the goal of 853 MWh.

The non-residential segment fared worse. Participation of 27 customers amounted to just 5 percent of the goal of 532, although energy savings of 3.074 MWh was 43 percent of the targeted 7,170 MWh.

All told, the companies saved a verified net 2,938 MWh of energy, taking about 0.4 megawatts off of system demand, in the Phase I program's first 11 months, according to an evaluation prepared by ADM Associates of California and submitted with the filing.

For comparison, second-year energy efficiency programs offered in 2012 by Appalachian Power and Wheeling Power, which serve fewer customers in West Virginia, saved, according to preliminary figures, 66,000 MWh, taking about 8 MW off of the need for generation capacity.

Such programs typically need a ramp-up period, said FE spokesman Todd Meyers.

"This is something we've noticed in Pennsylvania, Maryland — any other state where we offer energy efficiency programs," Meyers said. "It takes a while to get the word out to contractors, get everybody up to speed on the details. You need to build customer awareness — although the programs were implemented last February, that doesn't mean everybody on the first day was prepared to take advantage of the programs."

He did acknowledge that the goals the program fell short of in 2012 were not a simple one-fifth of the five-year goals, but rather were based on experience with other programs.

Still, he said, the company is confident it's on track for 2016.

About 90 percent of the planned savings are in the non-residential lighting part of the program, and commercial and industrial customers often can't take advantage of a rebate program until their next budget cycle rolls around, he pointed out.

"There are more projects in the pipeline now," he said.

When the commission approved the FirstEnergy companies' Phase I program, it noted that the proposal missed some of the "low-hanging fruit" — for example, subsidies encouraging customers to purchase compact fluorescent bulbs, such as the program in place by the AEP companies.

The commission asked FirstEnergy to submit by September 2013 a proposal for a Phase II program.

The annual report may be downloaded from the PSC website.